On Shrinking the City

Two FT pieces today on regulating international finance. The first covers some rather remarkable statements by the head of Britain’s Financial Services Authority (the regulator of financial services in the UK) on the place of the City of London in the UK’s economy. Lord Turner, the head of the FSA, says nothing less than that the FSA should “be very, very wary of seeing the competitiveness of London as a major aim”, and that the city’s financial sector has become a destabilising factor in the British economy. It also says that the FSA is looking at a Tobin Tax to curb the excesses of global finance.

In the second piece, columnist Gillian Tett continues her thoughts from last week on regulating global finance by assessing the cogency of the Tobin tax.