Thank you maggie

[NoddY]

Trouble with it, is that you've got to keep creating conflict for the global financial services sector to continue lending.

[Hart-floot]

http://www.economist.com/opinion/dis...ory_id=8057648

The new financial aristocrats don't wear old school ties. Many don't wear ties at all. People have brought talents and tastes from the four corners of the globe. The ethos is American: what you know matters more than who you know.

The results are hard to argue with. London has kept its long-standing dominance of foreign-exchange trading; its share of the market for over-the-counter derivatives has increased from 27% in 1995 to 43% in 2004. A fifth of the world's hedge-fund assets (including 80% of Europe's) are managed out of London, compared with a tenth in 2002. Though London's insurance market has suffered from tax competition, the City has powered ahead in services such as the law and ship-broking. In equities, the business Big Bang was designed to secure, London has hosted 172 international listings so far this year, compared with 134 in regulation-bound New York.
[
This is the lesson of Big Bang: to protect an industry, sacrifice your national champions. That brave decision 20 years ago brought wealth, jobs and cosmopolitan buzz to a once-sleepy City, and banished the overcooked cabbage for ever.

Of course the down-side - average house prices in London now 10X income, for most of 80's it hovered around 3half times average london income.
Large areas turning into transient districts with little or no community. Definately a more unfriendly place with little humour etc etc

Also since when was London a "once-sleepy" city?!?! Has this journo forgotten about Punk or the Rave culture?

[sunnysan]

http://www.economist.com/opinion/dis...ory_id=8057648


The City's success shows that exposing it to foreign competition is the way to do it
AT ANY half-decent lunch in the City of London a few decades ago the cabbage was overcooked and the conversation was about cricket. Today's financiers eat their brassica puréed, with seared scallops and a cumin jus, while chatting about the property they own back home in the Auvergne or New England. And they—and the businesses that pay their wages—are wealthier and more successful than ever.

Britain's most lucrative industry owes its dynamism to many things, including globalisation, innovation and the good fortune to be based in an old imperial trading city that sits handily between Asia and the Americas. But there was nothing pre-ordained about London's success as a financial centre: it happened largely thanks to an inspired piece of state intervention 20 years ago that opened the doors to foreign talent and foreign capital.



Square guile
On October 27th 1986, pressed by Margaret Thatcher's government, the City blew apart the closed shop of the London Stock Exchange in a reform known as Big Bang (see article). Out went minimum commissions and other restrictions, and in came a stampede of foreign firms. The government stood by and watched as they swallowed the old British firms that had previously dominated the City.

The new financial aristocrats don't wear old school ties. Many don't wear ties at all. People have brought talents and tastes from the four corners of the globe. The ethos is American: what you know matters more than who you know.

The results are hard to argue with. London has kept its long-standing dominance of foreign-exchange trading; its share of the market for over-the-counter derivatives has increased from 27% in 1995 to 43% in 2004. A fifth of the world's hedge-fund assets (including 80% of Europe's) are managed out of London, compared with a tenth in 2002. Though London's insurance market has suffered from tax competition, the City has powered ahead in services such as the law and ship-broking. In equities, the business Big Bang was designed to secure, London has hosted 172 international listings so far this year, compared with 134 in regulation-bound New York.

There are threats, of course. This week the two Chicago derivatives exchanges merged to create the world's largest futures exchange (see article). There is a constant danger of over-regulation, either after the next scandal or from the European Union, which is tempted to burden wholesale markets with regulations designed for the small investor. And London's transport system is dismal and its property overpriced.

Yet Britain's politicians understand—or at least they say they understand—what the City needs. This week they have been queuing up to announce pro-City taskforces and reforms. The recipe is as straightforward in principle as it is hard to provide in practice: open industries to new talent and expertise and to constant innovation, and regulate lightly. Get it right, and clusters start to grow. Financial markets are a striking example of how buyers and sellers of skills and know-how crowd together; but the effect has worked in Britain in other industries, too, such as carmaking and design.

This is the lesson of Big Bang: to protect an industry, sacrifice your national champions. That brave decision 20 years ago brought wealth, jobs and cosmopolitan buzz to a once-sleepy City, and banished the overcooked cabbage for ever.