Bankers bonuses - Osborne Stands Alone

[green]

I think you are missing the point. It isn't so much a question of individuals moving to banking centres outside Europe. It is a question of financial institutions moving complete with key staff. So there is less and less incentive for companies like HSBC (Hong Kong and Shanghai Banking Corporation) to base themselves in London.

So you like to imagine that a corportation is somehow obligated by these rules. The reality is that an international corporation can set up its head office pretty much where they feel they will get the maximum advantage.

 

As I posted earlier. "In 2011, financial and insurance services contributed £125.4 billion in gross value added (GVA) to the UK economy, 9.4% of the UK’s total GVA. London accounted for 45.8% of the total financial and insurance sector GVA in the UK in 2009. The sector’s contribution to UK jobs is around 3.6%. Trade in financial services makes up a substantial proportion of the UK’s trade surplus in services. In 2010-11 the banking sector alone contributed £21.0 billion to UK tax receipts in corporation tax, income tax and national insurance. " It wouldn't be difficult for the UK to loose a good deal of that business, revenue, tax and jobs. Singapore and other centres will welcome these institutions with open arms. So whilst it might suit some folk to carp on about a bankers bonus purely out of jealousy, whichever government is in power after the next election won't be able to increase spending if a large proportion of tax revenues has disappeared to the far east.

 

HSBC used to be based in the Far East. It moved to the UK, because the City of London was the capital casino in the world, and its banksters loved playing the rigged roulette wheel, whilst having a home in the countryside and the city and brilliant schools for their children, the golf course not too far away and the worlds best restaurants/hotels/clubs on the doorstep.

 

As much as id love them to bugger off, rest assured they will keep their lazy asses here, Hong Kong & Singapore are for the 22 yr olds, or so the FT keeps saying..

 

The banks have cost us five years of stagnation. They produce nothing. They sell pain & misery. We would be best of with out them & their bonuses. They keep promising to go, so why are they staying? Is it cos the City of London have kept their white collar crimes hidden or New York or else may not be so friendly.....

[TeaFan]

HSBC used to be based in the Far East. It moved to the UK, because the City of London was the capital casino in the world, and its banksters loved playing the rigged roulette wheel, whilst having a home in the countryside and the city and brilliant schools for their children, the golf course not too far away and the worlds best restaurants/hotels/clubs on the doorstep.

 

As much as id love them to bugger off, rest assured they will keep their lazy asses here, Hong Kong & Singapore are for the 22 yr olds, or so the FT keeps saying..

 

The banks have cost us five years of stagnation. They produce nothing. They sell pain & misery. We would be best of with out them & their bonuses. They keep promising to go, so why are they staying? Is it cos the City of London have kept their white collar crimes hidden or New York or else may not be so friendly.....

 

Nicholas Shaxson in his excellent book Treasure Isles argues that the UK financial system, through the crown dependencies, is one of the biggest secrecy jurisdictions in the world. No wonder it's so popular. Problem is it's also popular with organised crime and terrorists for the same reason.

[I1L2T3]

That's down to regulation. I note that all the troubles in the UK banking sector came after control was taken away from the Bank of England and handed to Brown's new baby the FSA.

 

There were failures before of banks with London bases. Barings, BCCI.

 

There is no problem with investment banks investing. That's what we are asking them to do. Part of the financial sector got into trouble by buying debt in an out of control spiral. That is what the regulator should have clamped down on.

 

If you read Private Eye you will know the bad ways are creeping back. Why aren't regulators clamping down now?

 

But that doesn't alter the fact that the financial sector never failed to contribute £10s of billions to the exchequer every year even at the height of the meltdown. Are we willing to kiss that goodbye?

 

Bailing out banks cost us hundreds of billions. We have been on the hook for over £700bn in various guarantees. We have paid subsidies to banks that pay little corporation tax, banks that are engineers of widespread tax avoidance.

 

What we want is to kiss the bad bits of the banks goodbye, let taxpayers from other countries be the backstop for their dodgy activities. We've done enough and can't afford to support and subsidise them anymore. London would still a major financial centre - the UK would still need retail banks and investment banks.

[green]

Nicholas Shaxson in his excellent book Treasure Isles argues that the UK financial system, through the crown dependencies, is one of the biggest secrecy jurisdictions in the world. No wonder it's so popular. Problem is it's also popular with organised crime and terrorists for the same reason.

 

Great book.

[Uptowngirl]

There were failures before of banks with London bases. Barings, BCCI.

 

 

 

If you read Private Eye you will know the bad ways are creeping back. Why aren't regulators clamping down now?

 

 

 

Bailing out banks cost us hundreds of billions. We have been on the hook for over £700bn in various guarantees. We have paid subsidies to banks that pay little corporation tax, banks that are engineers of widespread tax avoidance.

 

What we want is to kiss the bad bits of the banks goodbye, let taxpayers from other countries be the backstop for their dodgy activities. We've done enough and can't afford to support and subsidise them anymore. London would still a major financial centre - the UK would still need retail banks and investment banks.

 

It is a myth that the bank bailouts have cost us hundreds of billions. The bank bailouts as folk like to call them was a buyout of shares in a small number of banks. There was also a government guarantee of loans and cheap loans made by the government to banks in general. Whilst all this may amount to hundreds of billions you refer to, it is hardly a cost of that magnitude as the banks are repaying the loans and as far as I am aware non of the guarantees covered by the government as the last line of credit has ever been called in for a government payout. So what it boils down to is the price Gordon Brown and Alistair Darling elected to pay for the shares in RBS, Lloyds etc.

I think it is pretty clear that those 2 buffoons paid well over the odds for the shares. But even this isn't a cost to the taxpayer. The tax payer will only loose the loss in value if the shares are sold below the purchase price. This may well amount to a few 10s of billions, but will be far less than the financial sector has contributed to the exchequer since the "bailout" occurred.

 

In the meantime of course there are thousands of investment funds currently based in London to a value of may £trillions. The fund managers don't need to be in London, and with the right encouragement to move and the right discouragement to stay will happily up sticks and move to Singapore, Hong Kong or where ever they can get a better deal.

[Mister M]

Correctamundo. If someone can explain why bankers got fat bonuses after losing billions and can confirm that won't happen again I've no problem if they make millions if they erm, make millions.

 

Here we are - straight from the horse's (or tigers) mouth

 

One derivatives trader in his 40s, talks to the Guardian about EU plans to limit their bonuses.

 

"You want traders to be as aggressive as they can and make the bank as much money as possible, within their risk limits. Traders are like tigers, and their risk limits their cages". Talk about self aggrandising and delusional:hihi:

 

For the whole article http://www.guardian.co.uk/business/joris-luyendijk-banking-blog/2013/mar/10/what-london-bankers-think-bonus-cap?INTCMP=SRCH

[MadManMoon]

 

Aye, Cameron looks doomed either way. His policies aren't exactly popular with many Tories either.

 

 

This is what experts are saying about Tory policies

http://falseeconomy.org.uk/cure/what-do-the-experts-say

[Mister M]

This is what experts are saying about Tory policies

http://falseeconomy.org.uk/cure/what-do-the-experts-say

 

I was watching Newsnight last night, and it features the one of the experts on that list - the Nobel Prize winning economist Paul Krugman. He was debating the economic policy with Matthew Hancock MP (the Parliamentary Under Secretary of State).

It was rather like watching an edition of University Challenge involving Oxford Univesity versus Sheffield College.

[TeaFan]

I was watching Newsnight last night, and it features the one of the experts on that list - the Nobel Prize winning economist Paul Krugman. He was debating the economic policy with Matthew Hancock MP (the Parliamentary Under Secretary of State).

It was rather like watching an edition of University Challenge involving Oxford Univesity versus Sheffield College.

 

I wouldn't get too excited about Nobel Prize-winning economists. This debacle http://en.wikipedia.org/wiki/Long_term_capital_management was perpetrated by two Nobel Prize winners and a Wall Street legend. The problem with the shadow banking system is that it's hard to regulate and has become so complex that it is vulnerable to shocks like the one that hit LTCM that they didn't see coming. We can do without it.

 

Even the DG of the Institute of Directors seems to agree http://www.guardian.co.uk/business/2013/mar/13/bankers-pay-institute-of-directors