Late Lunchtime Links: How rich bankers make everyone else poor
The claim that investment bankers are bleeding the rest of the country dry may sound like the private mantra of Vince Cable, but the Economist says there may be something in it.
A blog entry on the magazine's website looks at the various arguments against bankers making lots of money and comes to the conclusion (citing another essay by Tyler Cohen) that extreme riches in the banking sector are indeed nefarious in their effect on society at large. This is mostly because of the skewed situation in which:
...the large rewards and guarantees of government bail-outs provide too much upside with too little downside. This asymmetry encourages excessive risk taking where the rich get the all the upside (when their bets pay off) and the poor and middle class bear the downside by being more adversely effected by recessions (when the bets go badly).
On the other hand, the Economist dismisses the New York Times' suggestion that the existence of very rich people discourages everyone else from even trying to earn more money, on the grounds that most people don't actually know the extremely wealthy (rich bankers included) and instead spend their time competing with the material welfare of their next door neighbours.
UK financial services firms have historically relied upon high pay to attract people and will therefore be stuffed under new EU pay rules. (Recruiter )
Boris Johnson - help the City by scrapping the 50p tax rate. (Evening Standard )
JPMorgan wants to hire 350 Swiss private bankers by 2012. (Financial News )
2011 will be a big year for anyone with Solvency II skills. (Insurance Daily )
2011 will be a big year for financial sponsors bankers. (WSJ )
The European Union may give regulators power to block new products and limit trading risks at banks deemed too big to fail. (Bloomberg)
Former Goldman Sachs and Credit Suisse trader joins EDF Credit Agricole joint venture. (Bloomberg)
Greek bankers bursting for a sabbatical. (Bloomberg)
Two million people are off sick after New Year. (Telegraph)
The difference between spending a higher salary and a higher bonus - fewer impulse purchases. (Sidney Morning Herald)
The 10 most fascinating savants in the world. (Neatorama)
