“The art of taxation consists in so plucking the goose to obtain the largest amount of feathers with the least possible amount of hissing”. So said Colbert. Judging by the amount of hissing and clucking from the broad-shouldered golden geese of the City of London yesterday we can safely conclude that Alistair Darling’s banker tax is categorically not artful. The Treasury estimates that the tax will raise £500m. With some seemingly simple expedients (delaying payments?) the tax take will be much lower, and if a couple of Goldman Sachs bankers do choose to relocate the long term revenue impact will be negative.

But the banker tax was never meant to be a revenue-raising exercise. It is a message to taxpayers outside finance; “we are making the guilty bankers pay”. This is artful politics. In fact “middle England” may be so pleased that evil bankers are being squeezed that they may not notice the £3bn national insurance bill hit the mat.

Banquo is still an active investor so will declare his financial interest where appropriate in any blog post.

Much gnashing of teeth about the threat to London as a financial centre at the Merchant Taylors’ on Tuesday night.

Forgive me if Banquo doesn’t get too alarmed. London’s status has been under threat since the Hanseatic league, and funnily enough its market share keeps on growing.

London’s preeminence is built on much more than “light touch regulation”. More regulation won’t help London, relative to New York or Geneva, but the expertise to develop and manage within that new regulatory framework exists in London.  Each new regulation will spawn a new business line.  Reg Q lead gave us Eurobonds, Basel II was the mother and father of shadow banking. The worst outcome for London and markets generally is a prolonged period of uncertainty.  If Monsieur Michel Barnier brings some French dirigisme to the overhaul of regulation London and its European hinterland should cheer.

Banquo is still an active investor so will declare his financial interest where appropriate in any blog post.


This blog is no longer updated but it remains open as an archive.

Banquo has spent more than 20 years in investment banking and the hedge fund industry, splitting his time between London, New York and Geneva.

Why is Banquo anonymous? Because he operates at a senior level across the financial markets, advising and investing, buying and selling, hiring and firing. He's still in the game but if he has a relevant financial interest in the subject of his posts, you'll know about it. Being anonymous keeps things simple. Banquo will never betray a confidence although he is privy to many.

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