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It's fascinating how the group dynamics of this whole situation work out. London provides enormous amounts of financial services to Europe. Around 35% of all w

It's fascinating how the group dynamics of this whole situation work out. London provides enormous amounts of financial services to Europe. Around 35% of all wholesale financial activity in Europe takes place in London. Around 85% of European hedge funds are there. Around 44% of all worldwide euro trading takes place there and around 70% of all derivatives trading. Figures from https://www.thecityuk.com/assets/2016/Reports-PDF/The-UK-Europes-financial-centre.pdf https://www.thecityuk.com/assets/2016/Reports-PDF/The-UK-Eur... In other words European companies rely heavily on people who currently live in London and presumably are settled there. In any normal situation this would be seen as "The EU wants access to London based services, we'd better make sure we negotiate that!". However that isn't what is happening. Instead the EU plans to simply pass new laws (changing the MiFiD II rules that aren't even implemented yet) in order to force the people who live in London to sell their homes, pull their children out of school, learn new languages and move elsewhere. The banking industry is resigned to this fate and barely even comments on it. To me this is indicative of the terrifying fanaticism at the heart of the EU. Talking about it is one of the taboos that Brexit has started to break. The people who run the EU are utterly, utterly unconcerned about the lives of the people who work in finance, they're utterly unconcerned about the economic welfare of European companies that heavily rely on the UK for financial services, they've refused to take up Theresa May's offer of ruling out forced expulsions right at the start, and their "plan" appears to be to refuse to negotiate any kind of cooperation at all until after the two year exit period is up. This is not what responsible, mature leadership looks like. This is what it looks like when people get it in their heads that they can do anything and nobody can stop them. You can always tell when there's a true fanatic in the room because the reasonable people start blaming each other for the "inevitable" consequences of trying to defy the fanatics. Their unbending will regardless of the cost comes to be seen as a fact of life that just has to be accepted, and everyone else starts to work around them and even blaming themselves for it. Europe will become a healthier place when people in positions of power and respect start being able to say that the EU is run by fanatics.

Findeton 10y ago
The UK voted for Brexit, you just cannot ignore its consequences. Deal with it just as we EU citizens have to deal with UK's bullshit.
- zigzigzag 10y ago
  You're proving my point. From my post: You can always tell when there's a true fanatic in the room because the reasonable people start blaming each other for the "inevitable" consequences From your post: The UK voted for Brexit, you just cannot ignore its consequences. Deal with it London handles transactions for nations and currencies around the world. If other countries had the same attitude the EU does, there would be no such thing as a "financial capital" because dollar transactions could only be processed in the USA, Yen could only be traded in Japan, etc. Nowhere would get critical mass and London wouldn't have any real financial services industry. It doesn't work like that.
- Chris2048 10y ago
  > we EU citizens have to deal with UK's bullshit details?
icebraining 10y ago
Which MiFiD II rules are being changed in order to force the people who live in London to move?
- zigzigzag 10y ago
  MiFiD II says that any country that has regulatory 'equivalence' effectively gets a financial passport, EU membership not required. The UK would obviously qualify, as it's currently obeying all the same regulations as other EU countries. The problem is that it's Brussels which decides what 'equivalence' means and it's a black box decision. It can be revoked at a months notice. You'll notice that zero of the EU's leaders are talking about MiFiD II or equivalence. They're all planning on how to carve up people's lives and jobs instead. It's as if these rules do not exist. That's not surprising. The EU has a long history of ignoring its own rules when they conflict with political priorities. The best example being that the treaties forbid eurozone bailouts as clearly as it's possible for the treaties to do, but they happened anyway.
  - icebraining 10y ago
    But did the EU change the way it decides what 'equivalence' means after Brexit? Or was it always a black box?
    - zigzigzag 10y ago
      It has never been defined. It is a purely political decision, which is why everyone is acting as if it doesn't exist: the EU will never follow the spirit of its own laws if there is perceived political advantage to not doing so.
  - notahacker 10y ago
    The UK is leaving the EU in order to be able to opt to not abide by EU rules. The UK hasn't a stated position on financial regulation beyond statements about grandfathering wordings until the UK government gets around to changing them, pledges rejecting all EU court oversight and some veiled threats to radically liberalise everything if they can't get the negotiation outcome they wish for. There exists a provision not-yet-implemented in UK or EU law which would give EU bodies some scope to allow some passported functions to be performed by people outside the EU if the country operating outside the EU agreed to abide by all the relevant EU financial rules to their satisfaction. Surprisingly, some banks don't find this provision for revocable permission contingent on non-binding commitments by the EU and UK quite as reassuring as the regulatory framework the UK has opted to tear up (particularly not for the staff performing functions not covered by MiFiD II) And somehow this is the EU leaders "planning to carve up people's lives and jobs" The level of intellectual dishonesty required to make the arguments you are making is really quite staggering.
johansch 10y ago
> The people who run the EU are utterly, utterly unconcerned about the lives of the people who work in finance Not to be crude, but often these people perform work that's against the public interest. Why should the EU be concerned about their personal well-being? Quite a lot (but not all) of their work is parasitical in nature.
tankenmate 10y ago
Europe wants significant financial services provided to European companies and individuals to take place within the EU; just like the US, Russia, etc... Nothing new here, this is exactly why the banks are going along with it. If you want to provide financial services within the EU you need to have an office within the EU and conform to EU regulations; not really that surprising or fanatical.
- zigzigzag 10y ago
  US, Russia, Asia don't care. London does clearing and derivatives work in dollar, renminbi etc without any of those countries having problems with it. If you check, you'll find it's only the EU that has a hangup about the physical location in which euro-denominated transactions occur.
- seren 10y ago
  On a not so related topic, the European Medecines Agency has its headquarter in London. I am not sure they are planning anything but it would be weird if a regulatory agency was working from outside of the area they are regulating.
  - johansch 10y ago
    The European Police College (CEPOL) left the UK for Hungary in 2014. Perhaps the detectives deduced that UK would leave EU? https://www.cepol.europa.eu/media/news/european-police-college-bids-farewell-united-kingdom https://www.cepol.europa.eu/media/news/european-police-colle...
  - CydeWeys 10y ago
    It seems inevitable that they'll move then. They're probably just delaying for now on the slim hope that Brexit doesn't happen. It'd make about as much sense as if the EPA were located in London.
  - kgwgk 10y ago
    There are many places in the EU that would like to be a new home for the EMA. See for example http://www.politico.eu/article/brexit-may-prove-irelands-lucky-break/ http://www.politico.eu/article/brexit-may-prove-irelands-luc... In the meantime, some people may decide to look for another job before being transfered god knows where... https://www.ft.com/content/2ca416ba-c8f8-11e6-8f29-9445cac8966f https://www.ft.com/content/2ca416ba-c8f8-11e6-8f29-9445cac89...
jon-wood 10y ago
> Instead the EU plans to simply pass new laws in order to force the people who live in London to sell their homes, pull their children out of school, learn new languages and move elsewhere. I think you've got this the wrong way round. The UK voted to leave the EU, and its not like nobody in the run up mentioned that it might lead to companies leaving the UK for EU countries. We made this bed. Time to sleep in it.
- zigzigzag 10y ago
  You're also proving my point. There is no actual, fundamental requirement for anyone to move anything anywhere in the wake of Brexit. The reason people have described this as "inevitable" is because the EU can be assured to mandate it, even though they don't have to, even though other regions don't mind having financial services provided by the UK. You're treating the EU's behaviour as if it's the laws of physics. That's how you know that there are fanatics in the room: people stop treating their behaviour as something that can be reasoned with, and start treating it as if they were some artifact of natural laws.
  - CydeWeys 10y ago
    The EU actually means something, though. It's a shared economic system. The UK is the one who's choosing to leave that system. So of course that means that ... drumroll please ... they're actually going to leave that system, which means that jobs that work inside that system now have to move somewhere else since London won't be in the system anymore. You're twisting yourself into knots to somehow pin this on the Europeans.
    - dustinmoris 10y ago
      British people are Europeans as well. EU <> Europe. Leaving the EU <> leaving Europe (and I am not even British, but it still annoys me when people don't know what they are talking about)
      - CydeWeys 10y ago
jankor 10y ago
There is no fanatism involved. The no deal scenario is optimal for the EU while not so much for the UK. WTO forbids cherry picked tariffs on other WTO members and the EU export to the UK consists mostly of capital goods and final goods (machinery, cars, foods). The UK exports services which Paris, Frankfurt and Amsterdam lobby to get a slice of. Cross-border financial services are easier to restrict.
alkonaut 10y ago
While I don't agree with most of your post, I agree with one thing - the EU are, and should (must) make an Example of the UK, or I think the union will fall apart after votes in e.g. Italy. Whether or not the EU should in fact try with any means to keep the union together is another question of course. But; assuming that's their goal, then I consider it pretty reasonable to a) try to rob London of as much financial business as possible by scaring large corporations into moving to EU cities b) scare other countries into not leaving the union by demonstrating a bad deal for the UK c) set tough positions before the Brexit negotiations start (which may be loosened during the actual negotiations). As a citizen of another EU country, I completely back what the EU is doing centrally at the moment, that is, I care less about the lives and careers of london financial workers, than I do the future integrity of the union. I completely agree with statements like "They voted out and there has to be consequences". Not because it is axiomatically so, but because I think tough consequences are the right choice
- NetStrikeForce 10y ago
  > I think the union will fall apart after votes in e.g. Italy. What vote exactly?
  - alkonaut 10y ago
    Future referendums on leaving the EU, in core EU countries. There are more or less advanced plans or propositions in many EU countries although none have yet had a proper referendum (and doing so in a Eurozone country would be more complicated than Brexit)
    - tobltobs 10y ago
      "There are more or less advanced plans or propositions in many EU countries." Citation needed.
      - alkonaut 10y ago
        Marine Le Pen (3rd party leader in France) demands a referendum. A leader of the 3rd party in Germany (Die Linke) demands the same thing. Luckily these countries are among the least likely to leave.
NetStrikeForce 10y ago
> (...) in order to force the people who live in London to sell their homes, pull their children out of school, learn new languages and move elsewhere. (...) Please, stop that. I am an EU national that works and lives in the UK. There's 3 million of us. Among my anecdotal data, 2 families have left already - the rest of us have been postponing / stopping for undefined time buying houses, cars and doing any long or even mid term planning. This is all because the UK citizens, plus the Irish, plus the Commonwealth citizens (that may or may not have right to live and work in the UK) voted and decided we were not worth it. As simple as that. We, of course, didn't have the right to vote. Don't even dare to use the "poor families" argument on this. > (...) The people who run the EU are utterly, utterly unconcerned about the lives of the people who work in finance (...) You can't be fucking serious mate. Whoever voted Leave in the referendum holds no moral ground to bring in these arguments. Edit: This comment's score is like a rollercoaster! Whoever is downvoting me, could you please please understand for a second that most of the people working in the financial sector had a vote on Brexit (as most people in the UK had), but 100% of the people that are now in a legal limbo had no vote on Brexit? Ok, thanks.
- oculusthrift 10y ago
  i also think it's funny he's trying to make us feel bad for people in finance. some of the most morally bankrupt people in the world. especially at hsbc.
  - NetStrikeForce 10y ago
    His comment and his reply to mine are despicable, distasteful and delusional. What a shame.
- zigzigzag 10y ago
  Congrats, you are also proving my point. You don't even consider that maybe the EU could just ... not do anything. There is no problem with euro-related transactions being handled in London. The vote was not a decision that you weren't "worth it". It was a decision that the EU is a problem and needs to be got rid of. But in a classic show of why the decision was correct, instead of blaming the EU for imposing trade sanctions on your industry, you blame the UK for voting to leave even though it's entirely the EU's retaliation that is to blame for your predicament. There is nothing that requires them to block Europeans from trading with the UK. The EU's actions are not inevitable. They are deliberate, spiteful and driven by the fear of a loss of political power. Take your anger to Brussels.
detaro 10y ago
> changing the MiFiD II rules that aren't even implemented yet Do you have a link to details? My understanding was that the passporting rule just makes licenses for banking valid in the entire EU (instead of only the host country) and that there are provisions to include countries with rules similar rules to MiFiD outside the EU, and the UK is currently still working implementing MiFiD to make this easy (also they will possibly still be a member state when the rules trigger) (I admittedly don't really follow Brexit-news, since to me it seems 95% of it is utter speculation. If banks really thought there was unavoidable trouble coming, they'd be moving and not just talking?)
tobltobs 10y ago
What is your suggestion? Should the EU change all their rules so the UK can leave but keeps all the advantages? Like the Brexit clowns promised before the referendum?

Findeton 10y ago

The UK voted for Brexit, you just cannot ignore its consequences. Deal with it just as we EU citizens have to deal with UK's bullshit.

zigzigzag 10y ago
You're proving my point. From my post: You can always tell when there's a true fanatic in the room because the reasonable people start blaming each other for the "inevitable" consequences From your post: The UK voted for Brexit, you just cannot ignore its consequences. Deal with it London handles transactions for nations and currencies around the world. If other countries had the same attitude the EU does, there would be no such thing as a "financial capital" because dollar transactions could only be processed in the USA, Yen could only be traded in Japan, etc. Nowhere would get critical mass and London wouldn't have any real financial services industry. It doesn't work like that.
Chris2048 10y ago
> we EU citizens have to deal with UK's bullshit details?

icebraining 10y ago

Which MiFiD II rules are being changed in order to force the people who live in London to move?

zigzigzag 10y ago
MiFiD II says that any country that has regulatory 'equivalence' effectively gets a financial passport, EU membership not required. The UK would obviously qualify, as it's currently obeying all the same regulations as other EU countries. The problem is that it's Brussels which decides what 'equivalence' means and it's a black box decision. It can be revoked at a months notice. You'll notice that zero of the EU's leaders are talking about MiFiD II or equivalence. They're all planning on how to carve up people's lives and jobs instead. It's as if these rules do not exist. That's not surprising. The EU has a long history of ignoring its own rules when they conflict with political priorities. The best example being that the treaties forbid eurozone bailouts as clearly as it's possible for the treaties to do, but they happened anyway.
- icebraining 10y ago
  But did the EU change the way it decides what 'equivalence' means after Brexit? Or was it always a black box?
  - zigzigzag 10y ago
    It has never been defined. It is a purely political decision, which is why everyone is acting as if it doesn't exist: the EU will never follow the spirit of its own laws if there is perceived political advantage to not doing so.
- notahacker 10y ago
  The UK is leaving the EU in order to be able to opt to not abide by EU rules. The UK hasn't a stated position on financial regulation beyond statements about grandfathering wordings until the UK government gets around to changing them, pledges rejecting all EU court oversight and some veiled threats to radically liberalise everything if they can't get the negotiation outcome they wish for. There exists a provision not-yet-implemented in UK or EU law which would give EU bodies some scope to allow some passported functions to be performed by people outside the EU if the country operating outside the EU agreed to abide by all the relevant EU financial rules to their satisfaction. Surprisingly, some banks don't find this provision for revocable permission contingent on non-binding commitments by the EU and UK quite as reassuring as the regulatory framework the UK has opted to tear up (particularly not for the staff performing functions not covered by MiFiD II) And somehow this is the EU leaders "planning to carve up people's lives and jobs" The level of intellectual dishonesty required to make the arguments you are making is really quite staggering.

johansch 10y ago

> The people who run the EU are utterly, utterly unconcerned about the lives of the people who work in finance Not to be crude, but often these people perform work that's against the public interest. Why should the EU be concerned about their personal well-being? Quite a lot (but not all) of their work is parasitical in nature.

tankenmate 10y ago

Europe wants significant financial services provided to European companies and individuals to take place within the EU; just like the US, Russia, etc... Nothing new here, this is exactly why the banks are going along with it. If you want to provide financial services within the EU you need to have an office within the EU and conform to EU regulations; not really that surprising or fanatical.

zigzigzag 10y ago
US, Russia, Asia don't care. London does clearing and derivatives work in dollar, renminbi etc without any of those countries having problems with it. If you check, you'll find it's only the EU that has a hangup about the physical location in which euro-denominated transactions occur.
seren 10y ago
On a not so related topic, the European Medecines Agency has its headquarter in London. I am not sure they are planning anything but it would be weird if a regulatory agency was working from outside of the area they are regulating.
- johansch 10y ago
  The European Police College (CEPOL) left the UK for Hungary in 2014. Perhaps the detectives deduced that UK would leave EU? https://www.cepol.europa.eu/media/news/european-police-college-bids-farewell-united-kingdom https://www.cepol.europa.eu/media/news/european-police-colle...
- CydeWeys 10y ago
  It seems inevitable that they'll move then. They're probably just delaying for now on the slim hope that Brexit doesn't happen. It'd make about as much sense as if the EPA were located in London.
- kgwgk 10y ago
  There are many places in the EU that would like to be a new home for the EMA. See for example http://www.politico.eu/article/brexit-may-prove-irelands-lucky-break/ http://www.politico.eu/article/brexit-may-prove-irelands-luc... In the meantime, some people may decide to look for another job before being transfered god knows where... https://www.ft.com/content/2ca416ba-c8f8-11e6-8f29-9445cac8966f https://www.ft.com/content/2ca416ba-c8f8-11e6-8f29-9445cac89...

jon-wood 10y ago

> Instead the EU plans to simply pass new laws in order to force the people who live in London to sell their homes, pull their children out of school, learn new languages and move elsewhere. I think you've got this the wrong way round. The UK voted to leave the EU, and its not like nobody in the run up mentioned that it might lead to companies leaving the UK for EU countries. We made this bed. Time to sleep in it.

zigzigzag 10y ago
You're also proving my point. There is no actual, fundamental requirement for anyone to move anything anywhere in the wake of Brexit. The reason people have described this as "inevitable" is because the EU can be assured to mandate it, even though they don't have to, even though other regions don't mind having financial services provided by the UK. You're treating the EU's behaviour as if it's the laws of physics. That's how you know that there are fanatics in the room: people stop treating their behaviour as something that can be reasoned with, and start treating it as if they were some artifact of natural laws.
- CydeWeys 10y ago
  The EU actually means something, though. It's a shared economic system. The UK is the one who's choosing to leave that system. So of course that means that ... drumroll please ... they're actually going to leave that system, which means that jobs that work inside that system now have to move somewhere else since London won't be in the system anymore. You're twisting yourself into knots to somehow pin this on the Europeans.
  - dustinmoris 10y ago
    British people are Europeans as well. EU <> Europe. Leaving the EU <> leaving Europe (and I am not even British, but it still annoys me when people don't know what they are talking about)
    - CydeWeys 10y ago

jankor 10y ago

There is no fanatism involved. The no deal scenario is optimal for the EU while not so much for the UK. WTO forbids cherry picked tariffs on other WTO members and the EU export to the UK consists mostly of capital goods and final goods (machinery, cars, foods). The UK exports services which Paris, Frankfurt and Amsterdam lobby to get a slice of. Cross-border financial services are easier to restrict.

alkonaut 10y ago

While I don't agree with most of your post, I agree with one thing - the EU are, and should (must) make an Example of the UK, or I think the union will fall apart after votes in e.g. Italy. Whether or not the EU should in fact try with any means to keep the union together is another question of course. But; assuming that's their goal, then I consider it pretty reasonable to a) try to rob London of as much financial business as possible by scaring large corporations into moving to EU cities b) scare other countries into not leaving the union by demonstrating a bad deal for the UK c) set tough positions before the Brexit negotiations start (which may be loosened during the actual negotiations). As a citizen of another EU country, I completely back what the EU is doing centrally at the moment, that is, I care less about the lives and careers of london financial workers, than I do the future integrity of the union. I completely agree with statements like "They voted out and there has to be consequences". Not because it is axiomatically so, but because I think tough consequences are the right choice

NetStrikeForce 10y ago
> I think the union will fall apart after votes in e.g. Italy. What vote exactly?
- alkonaut 10y ago
  Future referendums on leaving the EU, in core EU countries. There are more or less advanced plans or propositions in many EU countries although none have yet had a proper referendum (and doing so in a Eurozone country would be more complicated than Brexit)
  - tobltobs 10y ago
    "There are more or less advanced plans or propositions in many EU countries." Citation needed.
    - alkonaut 10y ago
      Marine Le Pen (3rd party leader in France) demands a referendum. A leader of the 3rd party in Germany (Die Linke) demands the same thing. Luckily these countries are among the least likely to leave.

NetStrikeForce 10y ago

> (...) in order to force the people who live in London to sell their homes, pull their children out of school, learn new languages and move elsewhere. (...) Please, stop that. I am an EU national that works and lives in the UK. There's 3 million of us. Among my anecdotal data, 2 families have left already - the rest of us have been postponing / stopping for undefined time buying houses, cars and doing any long or even mid term planning. This is all because the UK citizens, plus the Irish, plus the Commonwealth citizens (that may or may not have right to live and work in the UK) voted and decided we were not worth it. As simple as that. We, of course, didn't have the right to vote. Don't even dare to use the "poor families" argument on this. > (...) The people who run the EU are utterly, utterly unconcerned about the lives of the people who work in finance (...) You can't be fucking serious mate. Whoever voted Leave in the referendum holds no moral ground to bring in these arguments. Edit: This comment's score is like a rollercoaster! Whoever is downvoting me, could you please please understand for a second that most of the people working in the financial sector had a vote on Brexit (as most people in the UK had), but 100% of the people that are now in a legal limbo had no vote on Brexit? Ok, thanks.

oculusthrift 10y ago
i also think it's funny he's trying to make us feel bad for people in finance. some of the most morally bankrupt people in the world. especially at hsbc.
- NetStrikeForce 10y ago
  His comment and his reply to mine are despicable, distasteful and delusional. What a shame.
zigzigzag 10y ago
Congrats, you are also proving my point. You don't even consider that maybe the EU could just ... not do anything. There is no problem with euro-related transactions being handled in London. The vote was not a decision that you weren't "worth it". It was a decision that the EU is a problem and needs to be got rid of. But in a classic show of why the decision was correct, instead of blaming the EU for imposing trade sanctions on your industry, you blame the UK for voting to leave even though it's entirely the EU's retaliation that is to blame for your predicament. There is nothing that requires them to block Europeans from trading with the UK. The EU's actions are not inevitable. They are deliberate, spiteful and driven by the fear of a loss of political power. Take your anger to Brussels.

detaro 10y ago

> changing the MiFiD II rules that aren't even implemented yet Do you have a link to details? My understanding was that the passporting rule just makes licenses for banking valid in the entire EU (instead of only the host country) and that there are provisions to include countries with rules similar rules to MiFiD outside the EU, and the UK is currently still working implementing MiFiD to make this easy (also they will possibly still be a member state when the rules trigger) (I admittedly don't really follow Brexit-news, since to me it seems 95% of it is utter speculation. If banks really thought there was unavoidable trouble coming, they'd be moving and not just talking?)

tobltobs 10y ago

What is your suggestion? Should the EU change all their rules so the UK can leave but keeps all the advantages? Like the Brexit clowns promised before the referendum?