The hedge fund capital of Europe can’t get carbon trading signed off, is about to lose nuclear billions, facing tough competition from Shanghai/Singapore/Frankfurt and still looks prosperous, enjoying QE2 & doesn’t want to think strategically about the end of the decade… British banks have that look of early 1970s British Leyland – the only place ‘over-manned’ today is the City of London & Canary Wharf. The cuts are a ‘subsidy’ along with QE2 to keep it afloat. They are ripping through outsourcing, PFI, bonuses while they can the first half of this decade…. they know it can’t last.
It’s time we used that old argument of over-manning which was deployed to crush manufacturing industry and demand that the financial sector become ‘efficient, lean and mean’.
If Osborne can revive Thatcher’s enterprise zones, we can revive the question of overmanning.
And value add.
How is it that Germany survives without hedge funds (80% of whose ‘business’ is generated by London)?
The printing of money is keeping it going for now but this is not a solution.
Mervyn King knows it.