Instead of fiddling while Europe burns, we should be looking to the future in the East.
An interesting story in today’s FT says that London’s bankers earn more than their Swiss counterparts even since the 50p tax rate was introduced. This, then, is a good moment to reflect on how – and if – the global balance of power in high finance has shifted.
If you recall, a Swiss canton late last year was trying to seduce British bankers into moving there with a DVD (presumably containing shots of serene lakes and UBS bankers in handcuffs). It seems that our bankers managed to do their sums properly – for once – and realised that the few high-paying positions and the high cost of living there outweighed the tax advantages. The parlous state of the major Swiss banks and the destruction of Switzerland’s privileged privacy laws have also not helped.
But the London/Geneva/Zurich competition is a diversion, a side-show in the carnival of finance. Let the Americans throw coconuts at Ossie Gruebel, let George Osborne dunk the FSA in a shallow pool – these are games. What we should be paying attention to is the move eastwards.
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The news which lands in my inbox every morning is dominated by bankers moving not to Switzerland but to Shanghai and Singapore. It hardly needs to be said how fast those economies are growing, how large their piles of FX reserves are, what intellectual and physical manpower they can harness.
Instead of fiddling while Europe burns (or is subject to a hostile takeover – see pic), we should be looking to the future, and the rise of the East is something Spear’s will be focusing on in the coming months, in the magazine, on spearswms.com and in our calendar of events.
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