lördag 9 december 2017

The threat to the financial services “industry”

Financial services have concentrated in London not as a result of a conscious decision but for particular reasons which make it the optimal location. By preventing EU businesses from making use of London-based services, it is forcing them to employ consultants operating sub-optimally, which will incur not only the cost of the initial disruption but also ongoing additional costs; such is the foolishness of the EU's trade policies. How things develop remains to be seen. Some of the business may eventually return to London for the very reason it has concentrated there in the first place.

The present over-concentration of financial services in London is unhealthy and leads to a raft of problems. The departure of those businesses leaves premises in London vacant. The owners of the buildings they occupied will want to find tenants and so new opportunities will open up for other commercial users; they could be involved in design or technology-related activities. The important thing is that the owners do not sit on their real estate and leave it vacant for years on end.

From the mid-nineteenth century until the advent of the Nazis, European banking was concentrated in Berlin, Vienna and Paris. That, too, happened for specific reasons which we are not likely to see re-created. You can read the story in "The Hare with the “Amber Eyes” by Edmund de Waal.

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