London’s Burning
50% tax for anyone earning more than 150,000
40% for what a 1st year analyst makes
A Robin Hood tax specifically for the financial sector
Just a few of the wonderful propositions and enacted laws across the pond
And now this:
Man are you guys screwed.
The “New” New York. That was what London was called pre-crisis. What was once an aging city clinging to an illustrious past now seemed poised to rule the world once more.
Fueled by cheap money, ridiculous real estate, and a market so high it needed rehab, The City became a veritable Xanadu for the rich and the ambitious. Millionaires and Billionaires where made practically overnight, and they hung out with Russian oligarchs and Saudi Oil Sheiks who snapped up eight figure homes by the three’s. It was the place to be, it was where the champagne flowed freely and the party was never going to end.
It did. Bad. And it’s ALL YOUR FAULT.
"The people whose jobs were destroyed were in no way responsible for the excesses of the financial sector and the crisis that followed… the cost is now being felt… I'm surprised the real anger hasn't been greater than it has”"I joined the Bank of England 20 years ago today... I don't want to leave until we have a framework in place to ensure we don't have to go through this again."
Disgusting. This blatant lie does nothing but fuel more populist hatred and set the stage for more and more regulation, of which the new government seems to be more than happy to give.
How do you monkeys working in The City feel this affects London’s station as a financial hub? When your Central Banker washes his hands and bends over to populist rage, you should be looking for work elsewhere in my opinion.
Never mind the “innocent victims”, as it is The City is lucky that it isn’t a ghost town. The exodus to Geneva wasn’t as bad as it was made out to be, even with extortionate taxes, industry people still found a reason to stay. But where are the rich? 30 room mansions in Mayfair and Knightsbridge are abandoned and squatted in by hippies. Even the house of Lords, whose members must maintain citizenship or lose their titles, has lost a few members to tax free Monaco.
This may be the straw that breaks the Camel’s back. Nowhere else is the banker vitriol worse than it currently is in the UK, add in more stifling regulations and Robin Hood taxes, profit margins will shrink along with along with its competitiveness.
London is burning, and in its ashes lie commies.
I come every time you come around my londy londy bridge wanna go down?
like londy londy londy we goin down lol.
You'd think with so many important firms moving their headquarters from London to Switzerland as taxes go up, these knuckleheads would have some idea of what works and what doesn't. Breven Howard left, Moore left...pretty soon there aren't going to be enough rich folks to pay all the bills. It has to stop.
Sorry but how is it a blatant lie?
A colleague's cousin of mine just accepted a IBD asia offer because he was getting 30% more after taxes and conversion.
40% Income Tax and 20% VAT ...
To make it easy, if we assume that a first year analyst takes in $100,000 per year, or approx 62,000 GBP, then your take home income is actually higher in London than NYC assuming an exchange rate of 1.62.
London
http://listentotaxman.com/index.php
NYC
http://www.paycheckcity.com/netpaycalc/netpaycalculator.asp
Play around with your income, total tax paid in NYC is broadly in-line with London. In fact, your take home is normally larger in London. Lets stick to facts here guys.
I was just going to make a similar point...
Umm....how is this guy lying? He's saying that when financiers gamble with industries and companies and get big bonuses for short term profits the inevitable crash dis-proportionally affects the workers of those companies that go bust. That's kind of shitty when you think about it - it seems reasonable there should be extra tax on profits so that when you have to bail the financiers out again you can do so with the insurance collected. Who knows if the UK government has their shit together not to just piss the money away, but one can hope.
The public certainly has a right to be angry at the financial services sector. What I take issue with is when they flame on Investment Bankers (who basically had nothing to do with the crisis) and Traders (95% of whom had nothing to do with the crisis). If you want to flame on MBS traders and credit structures/traders then fine. The guys in equities and my colleagues in macro had absolutely nothing to do with the fact that some idiotic 25 year old took out a 110% mortgage to buy a house.
I also take issue with the fact that we have to live with lower bonuses just because politicians are trying to buy votes from the middle class; the same people who bitch about bankers bonuses at the pub while watching footballers who get paid 50x what I make to kick a ball around all day.
Footballers aren't part of the industry that almost collapsed the world economy. You sound like an idiot from Fox Business, attacking the middle class while defending the criminals on Wall Street. I agree with you that people in equities had nothing to do with it, but when A PART OF YOUR FUCKING COMPANY makes those kind of trades and invests in CDO's and needs a bailout, YOU SHOULD NOT BE GETTING A HUGE BONUS!!
Its funny..when it comes to stuff like the teachers in Wisconsin who make 50k a year, conservative idiots go "well that's a decent salary for people who work only 10 months a year". But when Wall Street bonuses come under fire, people shout "this is capitalism!".
Think you missed the part where he blames the financial services industry alone as the cause of the crisis dude.
While I do understand how you can blame some of the crisis on the regular workers that borrowed more money than they could ever pay back, I do not quite understand how this has anything to do with people in the UK or anywhere else but in the US. And since the UK can't really tax people in the US, I guess they have to stick with what tbrought the crisis to their country
What about the fact that different people have different explanations of the crisis? Your explanation is definitely plausible, but so is the explanation that bad policies had a lot to do with this crisis, such as policies to promote homeownership among people who can't afford it, implicit agreements between the government and Fannie Mae and Freddie Mac, easy money from Greenspan, previous Fed bailouts of Wall Street firms, etc. Other explanations of the crisis have to do with the flawed mathematical and economic models (this has been discussed many places, including Jorge's previous post titled "History With Jorge" where you can watch the documentary "Quants: The Alchemists of Wall Street"). I'm sure there's even more explanations.
The world is a complicated place...
Fact of the matter is nobody was truly innocent coming up to the crisis, so all those explanations are correct to a certain extent.
Central bankers spread their legs with easy money, the banks saw a good time and promptly started banging, other financial companies joined in to eiffel tower her then in came big business, real estate, etc. Policy makers saw everyone was having fun so they made the populace join in too. As the orgy went on a few made eye contact so shit started to become ugly, ultimately leaving everyone ashamed, crying, and with a burning sensation when they pee.
Europe = spent power
The US will remain the global leader for at least the next generation, and provided the next generation are total retards, will remain dominant for much longer. The worst is mostly behind us.
fucking Jim Cramer is on this website!
^ Although I'm partial to the tea party, I would agree with your last statement. I have the same issue with Soros.
Damn, you got me.Well, Frankfurt/Paris, here we go....
will the taxes across the pond impact salaries in the US arms of British banks?
The US is in a far worse fiscal position than Europe, even when you take Greece, Ireland, Portugal etc into account - at some point your taxes will rise.
And fuck bankers...yes you were a big part of the cause of the financial crisis....to try and blame it entirely on sub-prime borrowers, regulators or whatever else is moronic. We in the financial services deserve to pay high taxes, our jobs involve sitting in meeting rooms moving money around the world with very little social benefit (efficient capital allocation is bullshit).
And move to Geneva? Have you ever been there, I go once a month and as soon as I arrive I can't wait to leave, most boring place in the fucking universe, they can keep their transport system and low taxes.
Like it or not, what you call 'moving around money' is actually one of the crucial foundations of society
prime borrowers, regulators or whatever else is moronic. We in the financial services deserve to pay high taxes, our jobs involve sitting in meeting rooms moving money around the world with very little social benefit (efficient capital allocation is bullshit).
^^^^^^^Get this comi out of here! Go join the peace core hippy
The fact is its all bullshit, the whole system is corrupt and will one day collapse in a burning pyre of self interest, greed and anxiety.
Have a nice weekend y'all.
what fucking communist neo nazi workers party do you belong to?
and yes OF COURSE its not a macroeconomic storm and all the people who bought houses they couldnt afford and the shady mortgage bankers who signed off on the shitty mortgages and etc are certainly not to blame, just the bankers at the top. ahem.
and to who said paris as financial capital -- no, def not.
i moved to a country that has high taxes BUT low taxes for specialist workers. You benefit from a decently funded government and good state spending with an educated population but you have way more disposable cash. I'll go back to London because it's home when i want to settle. Until then, being paid to see the world. yes please.
The majority of the British public would probably struggle to explain to you what a Banker does if you were to ask them. I think that this is where the City fails to do itself any favours - they've been ghostly silent when infact they would do themselves a great favour to communicate to the public exactly what it is they do. Until they do this, then the 'Banker' tag will be attached to anyone and everyone.
As someone who lives and works in the UK, I can say that members of the public who understand the City a little better are absolutely appalled by the FSA. It did absolutely nothing to prevent what happened.
The issue here is that the incompetence of the FSA has not been communicated by the British media. Rather, the media here has found it much easier and more profitable to 'Banker-Bash' - its a very marketable and tangible outlet, especially when people are depserately looking to blame someone for them being unemplyed after thirty years hard graft.
Random question: Why do people hate finance professionals so much? When the tech/internet bubble bursted, nobody was saying we need a tax specifically on entrepreneurs. I suspect it's because people don't see finance professionals as contributing anything to society, and they feel that entrepreneurs "build something" (even though this overlooks the fact that middlemen provide a tremendous value and many entrepreneurs don't actually make products, but services).
1) People don't hate finance professionals. Your personal financial adviser, your local branch manager, the every town has one life insurance peddler. These sorts of people make up the vast majority of finance professionals and they are not hated...leading into...
2) "Wall Street" (to supplement going into morbid minutiae) controls a disproportionate amount of American wealth and bends public interest and government policy to its own profit making whims. Many, many people who never invested, bought a stock or asked to be involved with "high finance" are adversely affected by "it" every day of their lives.
3) This is a reality. However, where "the techies" from your example are (by and large) "we love the world, save the trees" kind of people...the "finance professionals" from your example are (by and large) "eh you sheet metal working dumb asses should have known not to let your pension fund be run by a PM I'd be able to talk into buying slabs of the XYZ-tranche pie". Those tech start up guys who blew out are no better or nicer than the average Wall Street stiff, they just don't make themselves as much of a target.
4) It's wrong to say that Wall Street adds nothing to society. It's correct, however, that Wall Street adds jack shit to society in times of crisis. We've seen an army of incompetent idiots (who wouldn't know Alpha if it bit them on the ass today) make steady 20-30% returns in the 80's and 90's...none of these guys are capable of providing jobs or relief to the country at large. Entrepreneurs on the other hand create jobs. This is why they will always have a stronger Q rating. Entrepreneurship is also the foundation upon which this country was built, even though we live in times when people are ashamed to be Americans...this emotional factor still strikes a chord with the common man.
5) Economists are idiots. Sorry, nothing personal. But as I am sure you can attest to some small or large degree, the logic and reasoning of modern econ is perverted and pervaded by interest. There is a huge logical fallacy (accepted dogmatically) that the world cannot exist without the sort of uniformed, integrated and organized markets that we have today. What the common man knows in his simple wisdom, is that he can trade his goods for money or other services on a simple (dare I say, primitive) scale and doesn't need a large intricate financial system to survive. This is the basis of economics in its simplest form, whether you're Keynes, Hayek or Friedman...The fact that our learned elite ignores this reality is the backbone to the issue surrounding your query.
Obviously, there's a shitload more but these would be the broad strokes.
Yeah, my bad. I couldn't think of a better phrase. I guess I should of said Wall Street employees?
So, you think it's mainly because the public feels they influence government? I suspect there's also an envy component. Would you agree?
Haha, good point. The caricature of Wall Street and the caricature of an entrepreneur are, no doubt, very different.
I totally agree that Wall Street adds to society. It seems that time and time again throughout history, middlemen are seen as taking something they don't deserve. That view on middlemen is a basic econ fail, as discussed here: http://www.econtalk.org/archives/2008/10/munger_on_middl.html
Wall Street creates jobs too, it's just not as obvious to the average person. Where do they think people get the money to start businesses in the first place.
Haha, none taken (I'm not an economist). Some economists can really change your views (particularly F.A. Hayek, for me), while others are probably not worth reading, so it's a mixed bag.
Actually, I think a lot of economists would agree with you that we could have a different system (especially if you read Hayek). I think what they'd say, is that people could definitely barter. Money just naturally evolves from bartering and financial markets evolve naturally, as well. Now, I think the point of departure of many economists is the degree to which the financial sector is important to the health of the real economy. Many economists actually think we should of let the banks fail, because we don't need the exact set of markets and institutions we have today. They believe that there is too much emphasis on financial markets and too much emphasis on keeping things the way they currently are. If they were still alive, I'm pretty confident that Hayek and Friedman would both be in that category. I suspect you're generalizing to a whole group of professionals, based on what a loud subset of them have been saying. Surprisingly, the views of economists are actually pretty varied.
Surely the retail side of banking where those shitty loans were originated and sold to willing buyers is more to blame for the crisis than anything seen in the Investment Banking side. The only people that can really share the blame at an Investment Bank were credit structures/traders and MBS traders.
Why are entrepreneurship and Wall Street mutually exclusive in your eyes? You don't think innovation in Wall St created thousands of jobs across the US? The success of the financial sector has increased employment within the sector itself, and in the sectors that serve it.
Get this comi out of here ^ and go join the peace core hippy
Stereotyping are we now? Ok, you hillbilly, go get your fucking gun and your bible its time for your KKK meeting you cousin marrying douchebag.
Compensation is the last reason the crisis happened. This Robin Hood tax thing is absolute garbage.
Agree with the first two points but no way is robin hood tax gonna get implemented and Cameron I remember saying was saying that in a few years time he will remove the 50% tax rate. Also seeing as we have lowered our corporation tax and introduced new loopholes I don't think London will be going away any time soon. Also Mervyn King's views are to break up thee banks, which frankly I think should be happening in the US too and every other country. Taxpayers should be protected from the socialising of losses.
Also one of the more interesting stuff that the BOE has came up with is the subsidy that the UK taxpayer is providing to the banks. It was around 150 billion or to put it another way without it our banks would be making a loss
a) Koch brothers inherited a decent business from there father. But they built it into the 100b per year business it is today. There is no such thing as the tea party. Americans for Prosperity =/= tea party. The tea party is just a bunch of protests by a variety of right-wingers, not an organized political entity. If lefties were protesting it would just be called a "protest" but the media needs to somehow rationalize and sensationalize the fact that right-wing beliefs are not exclusive to "evil fat cats."
b) Government and Central banks were the cause of the GFC. Certain sectors of the financial services industries just made it even worst. If government didn't try to impose arbitrary values ("the poor/middle-class need more housing!") on the private sector then chances are none of this would have happened. I have no idea why most of you seem to think the solution is to have more government try to impose more arbitrary vales on the private sector.
c) No-one deserves more taxes. People shouldn't view things through a class-warfare paradigm. The more money in the private sector and the less money in the public sector the better, regardless of who that money belongs to.
if you needed before to take X risk to make a Y net salary, now you will need to take X*B risk to make the same Y net salary, where B>1
this taxes thing is just stupid
Ea et ut nemo corrupti debitis et. Cum omnis error consequatur. Aspernatur earum quia autem et adipisci occaecati vero.
Perferendis quae qui ut velit quasi. Hic ut quia eveniet aperiam alias aliquid quo sed. Qui eveniet architecto sequi omnis rerum explicabo rerum modi. Exercitationem rerum nesciunt qui corrupti blanditiis. Rem consectetur illo aspernatur qui omnis est delectus.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Sed doloremque debitis dignissimos architecto harum facere qui. Repellendus dolorum aliquam itaque quis consequatur tenetur qui.
A esse aliquid aut dignissimos dolor. Atque voluptatum eos voluptatem nesciunt adipisci numquam. Praesentium omnis mollitia ducimus cum dignissimos dolorem. Nihil tempora rerum aliquid a neque consequatur quibusdam.
Cupiditate nihil nostrum consequatur culpa molestiae velit. Corrupti voluptates et facilis aut debitis quisquam et sit. Deserunt eos non nostrum eos et.