Despite Pro-EU people saying that Frankfurt would become Europe's financial capital as Britain rejects the Euro currency, the exact opposite has happened - London has not only remain the financial capital of Europe but is also on course to overtake New York (burdened with too much red tape) to become the financial capital of the world for the first time since the days of Empire. Once the world's greatest industrial power, Britain is on course now to be the world's financial power -
The rise and rise of London
By Jasper Gerard
18/02/2007
While building St Paul's Cathedral, Sir Christopher Wren uncovered a broken stone inscribed "Resurgam". With the extraordinary rebirth of London at the start of the 21st century, no architect should be lost for an inscription for the dazzling cathedrals to capitalism currently springing up across the skyline: "I will arise" seems more than fitting for today.
London calling: Like the rest of Britain, London is experiencing an economic and cultural resurgence
To have been in London these past few weeks has seemed, at times, like residing in the capital of the universe. It might lack a little of the pomp of 1900 when the City Imperial Volunteers, back from the Boer war, marched spectacularly through crowds 100-deep in Hyde Park as "hysterical shrieks of women mingled with the deep-throated huzzas of the crowd". But with the Baftas, Brits and London Fashion Week, London has just borne witness to a cavalcade that reinforces its economic and cultural resurgence.
Today, London stands on the brink of surpassing New York as the world's financial centre; a week of art sales earlier this month has raked in a record £392 million, and France's likely future president has been electioneering - in London. There is a palpable sense that something big is going on. It is a phenomenon much more important than Cool Britannia, embraced by New Labour a decade ago. It is about sheer power, and it renders all other cities faintly provincial.
How London will look circa 2012
Once, the world sang New York, New York with Frank Sinatra. Now, as we prepare for the Olympics, it is London calling. And this time it is in merriment, not anger.
To me it seems an almost miraculous resurrection. My impression of London on childhood excursions in the 1970s was of a city broken by disappointment and bad plumbing. Loss of Empire and economic collapse glowered over the capital. The cars were knackered, the people more so. Everywhere there was dog muck. It wasn't that we were tired of London so much as that London was tired. There was a feeling that history had flown down the Thames and far away, just as inexorably as the life blood drained from Babylon, Samarkand and Constantinople.
As funky new restaurants now open daily, I look back in wonder at a visit circa 1976 to one of London's smartest restaurants. My sister asked for something vegetarian; after long stares and consultations it was agreed an omelette might be possible. At the time, the very survival of London could even be questioned. As late as 1989, Martin Amis wrote: "I must go to London Fields, before it is too late."
Amis-land - stale ashtrays, darts, squalor - already seems as period as "Greeneland", Graham Greene's evocation of seedy bed-sits, coin-operated electricity meters and chipped whisky glasses somewhere off the Edgware Road. That is not to paint modern London as paradise: not with a spate of shootings, congestion, dirty streets and expensive housing. But while announcing at a party that one worked abroad once elicited coos of envy, now it merely provokes bafflement: why would you live anywhere else than London?
If this sounds jingoistic, London's rebirth is not a singularly British triumph, for the capital often appears to be in opposition to its country. The slick metropolitanism of Tony Blair and David Cameron can jar with Middle England. London is Athens, the city state making decrees that the surrounding countryside obeys sulkily.
And like Athens once did, London sucks in all talent. Look at its two finest football teams, Arsenal and Chelsea: both have fielded sides entirely bereft of Englishmen.
A Brit can feel like a foreigner in his own capital. Once New York was the world's melting pot, now it is London: 36 per cent of New Yorkers are foreign-born, against 40 per cent of Londoners. While bidding for the Olympics, New York boasted 200 languages could be heard on the streets of the Big Bagel. It went silent when it learnt London echoes to 300.
How much immigration drives our economic revival is a moot point, but immigration is, incontrovertibly, a response to that revival. As well as the super-rich of Russia, the super-poor of Eastern Europe dream of the Thames Gateway as the promised land; hard to fathom, but the London Eye has taken on the iconography of the Statue of Liberty.
The M25 - the nearest we now have to a city wall - encircles the largest professional population on the planet, with more flying in every day via our five airports than to any other city. With such an educated workforce, no wonder more books are published here than in any other city.
London might look like Paris's plain friend across the water, but when presidential candidate Nicolas Sarkozy sought support from the French elite he came to London, the seventh-largest French city. More than 300,000 French people live in Britain, with South Kensington resembling a mini-Paris. Sarkozy praised London to the clouds, promising Thatcherite tax cuts and urged Frenchies to return to Paris - to make it like London. To appreciate the change, imagine Jacques Chirac doing that when he ran for president seven years ago.
Russian plutocrats are just the latest out-of-towners to like the country so much they bought it. It was made possible by Gordon Brown's decidedly un-socialist, un-Presbyterian decision to exempt foreign swanks from the inconvenience of paying tax on income earned abroad. Lakshmi Mittal (worth £14.8 billion) and Roman Abramovich (a mere £9.1 billion) are among 11 foreign-born London billionaires, augmenting our 12 native billionaires.
It is this openness to outsiders that many think has enabled London to eclipse New York. After 9/11, America turned inwards, reducing immigration that for so long had stoked its economy. It also introduced humiliating airport checks that outrage foreign businessmen. Not that we can be smug in "Londonistan": it would be futile to put up such security blankets here - we know that the terrorists are already among us.
The rise of London at New York's expense cannot be attributed to immigration alone. London has been helped by a lighter regulatory framework, which attracts jealous glances from across the pond. While Wall Street once swarmed with ticker tape, now it is red tape - a response to the Enron and WorldCom scandals.
New York's mayor, Michael Bloomberg, so fears that London is "rapidly gaining ground" that he has commissioned a report: London, he suggests, threatens the very future of America. If we really can become the dominant power of world finance, then imperial London will be reborn; and every indication is that it can.
A 2005 survey of financial types scored international cities and London won easily, beating New York in all bar one category. The City employs a smidgeon under Wall Street's 328,000 souls but is gaining fast. Some 367 companies floated in London over the past year, raising £29 billion - against 270 in New York, yielding £28 billion. London has the most foreign banks, 70 per cent of the world's secondary bond market and half the derivatives market. It is home to foreign-exchange trading and 80 per cent of Europe's hedge funds.
Our private equity firms raised £20 billion last year, and our law firms - the world's biggest - contributed £11 billion. If last year's record £9 billion bonus celebrations seemed muted after the cork-popping excess of the 1980s it is because then wealth was novelty, now it is normality. Even the head of Goldman Sachs spends half his time in the identical London office he has had built to match his New York one.
Such are the tremors the world still feels 20 years after the Big Bang set the City free.
A decade ago, it would have seemed fanciful that we could usurp New York as the world financial capital, when the smart money was predicting London's eclipse by Frankfurt as Europe's financial capital. Instead, Deutsche Bank moved the global headquarters of its investment banking division to London and Frankfurt is a smaller financial centre than Canary Wharf. Britain's refusal to join the Euro prompted many to write London's obituary, but even that has proved another opportunity, with 80 per cent of trade in the currency occurring here. With plummy Brits dominating the burgeoning asset management business for the world's super-rich, we are becoming Zurich-on-Thames.
And boy, is all that felicitous, filthy lucre affecting London life. It has fed a salivating atavism that makes the Beckhams' lifestyle look positively spiritual. And there is much more than City money sloshing around Bond Street and Burlington Arcade. Sotheby's has sold £167 million of paintings in the past week, including a record £94.9 million for a single sale, while Christie's sold Francis Bacon's Study for Portrait II for £14 million. The same big money is being paid for anything that smacks of luxury. Theo Fennell, jeweller to Elizabeth Hurley and Elton John, reports a seven-fold increase in pre-tax profits.
All this loot has achieved the impossible and turned London into a world gastronomic centre, too. In his novel Hawksmoor, Peter Ackroyd described foul meals of eels, the "noise and the vapours of the Ale House"; now London exports food. And how: Gordon Ramsay opens a restaurant in Manhattan - called "London".
Even our cocktails are better, apparently. Audrey Saunders of Manhattan's great Pegu Club sighs: "I hate to admit it, but London is the best cocktail city in the world."
Our splurge on fripperies is trifling against money being sunk into property: a pied-à-terre off Knightsbridge is rapidly becoming pricier than some spaciously appointed African state in need of modernisation. With London's population rising to 7.5 million and the housing stock almost static, prices are heading so far north they are positively Arctic. Four flats in Hyde Park are up for £84 million each, and folk are fighting for them.
Apartments around Central Park can be snaffled for £1,400 per sq ft, but Belgravia pads often exceed £3,000 a sq ft, up 35 per cent in a year. Here, natives with a couple of million who would be called rich anywhere else can't compete against foreigners who think nothing of upping a bid by a million. In London the average home costs £500,000, after rising 11.3 per cent in 2006.
The easiest way to spot a city's vitality is to look for cranes, and the City is creaking with them. Exciting new edifices will include London Bridge's 72-storey "shard of glass". But while money underpins London's resurgence, its attraction also rests on much that at least starts as anti-commercial. For a city superficially conservative, London is a haven for quirky, anarcho-weirdos. That was evident at London Fashion Week.
The "Shard of Glass" in London will be Europe's tallest building
Anna Wintour, editor of American Vogue, flew in declaring: "I come to London for ideas, not for clothes to wear." Even American-owned Vanity Fair concedes: "London produces three-quarters of the fashion ideas for the rest of the world."
Paul Smith, John Galliano, Alexander McQueen, Hussein Chalayan and Sophia Kokosalaki all shot to prominence at LFW. And now the big boys are seeking a bit of that credibility. For the first time, the man they call the designers' designer, Marc Jacobs, sashayed into collections that used to be the ugly duckling of international style, following in the footsteps of Giorgio Armani last season. Once, such an event seemed as likely as the Duke of Westminster settling in Wigan.
If anything, the eccentric London art scene is even more thriving. You don't have to adore everything in Tate Modern - which, with the Gilbert and George retrospective, literally includes excrement - to realise it is the world's most vital showcase for contemporary art, just as New York's Museum of Modern Art once was. And as for theatre, we started to fear that, dominated by sickly musicals, it would never make a recovery. Now it bursts with challenging news plays. Hollywood actors - from Kevin Spacey down - make their bucks Stateside, but in some curious way feel validation requires critical approval on our boards. David Hare's experience of opening The Vertical Hour in New York left him reflecting that Manhattan was "artistically much more conservative. There is a definite feeling of being bored with the old, yet even more terrified of the new." Not so London.
There was little left of British film to revive, so the burgeoning celluloid industry is essentially new. In 2005, a record 12,655 days of shooting took place in London, many with that quintessential New Yorker Woody Allen mooning over Scarlett Johansson in Match Point under the leaden London skies he has fallen in love with. Even the Baftas - once mildly less significant than a Blackpool wet T-shirt contest - now set the agenda for the Oscars. And to complete a remarkable week, the crème of international rockers such as the Killers and the Red Hot Chili Peppers played at the Brit awards, alongside local troupers Oasis.
Remarkably, London's rise has been in spite of, rather than because of, government. Just think what London could be without high taxation, terrible transport and even worse social services. Moreover, Mayor Ken Livingstone has often appeared keener posturing than governing. We need a Rudy Giuliani.
And the danger ahead? Even Athens fell in the end, as confidence lapsed into decadence. Only London spawns companies such as Quintessentially, a concierge service satisfying an elite's outlandish demands: a dozen albino peacocks for your party tonight? Certainly, sir.
We know the Olympics will prove a financial disaster. Eventually, the cavalcade will move on, history flowing down the Thames to some other city of human possibility. But for now, as London's biographer Ackroyd smiles: "If London were a living thing, we would say that all of its optimism and confidence have returned - the capital of all capitals again."
telegraph.co.uk
The rise and rise of London
By Jasper Gerard
18/02/2007
While building St Paul's Cathedral, Sir Christopher Wren uncovered a broken stone inscribed "Resurgam". With the extraordinary rebirth of London at the start of the 21st century, no architect should be lost for an inscription for the dazzling cathedrals to capitalism currently springing up across the skyline: "I will arise" seems more than fitting for today.
London calling: Like the rest of Britain, London is experiencing an economic and cultural resurgence
To have been in London these past few weeks has seemed, at times, like residing in the capital of the universe. It might lack a little of the pomp of 1900 when the City Imperial Volunteers, back from the Boer war, marched spectacularly through crowds 100-deep in Hyde Park as "hysterical shrieks of women mingled with the deep-throated huzzas of the crowd". But with the Baftas, Brits and London Fashion Week, London has just borne witness to a cavalcade that reinforces its economic and cultural resurgence.
Today, London stands on the brink of surpassing New York as the world's financial centre; a week of art sales earlier this month has raked in a record £392 million, and France's likely future president has been electioneering - in London. There is a palpable sense that something big is going on. It is a phenomenon much more important than Cool Britannia, embraced by New Labour a decade ago. It is about sheer power, and it renders all other cities faintly provincial.
How London will look circa 2012
Once, the world sang New York, New York with Frank Sinatra. Now, as we prepare for the Olympics, it is London calling. And this time it is in merriment, not anger.
To me it seems an almost miraculous resurrection. My impression of London on childhood excursions in the 1970s was of a city broken by disappointment and bad plumbing. Loss of Empire and economic collapse glowered over the capital. The cars were knackered, the people more so. Everywhere there was dog muck. It wasn't that we were tired of London so much as that London was tired. There was a feeling that history had flown down the Thames and far away, just as inexorably as the life blood drained from Babylon, Samarkand and Constantinople.
As funky new restaurants now open daily, I look back in wonder at a visit circa 1976 to one of London's smartest restaurants. My sister asked for something vegetarian; after long stares and consultations it was agreed an omelette might be possible. At the time, the very survival of London could even be questioned. As late as 1989, Martin Amis wrote: "I must go to London Fields, before it is too late."
Amis-land - stale ashtrays, darts, squalor - already seems as period as "Greeneland", Graham Greene's evocation of seedy bed-sits, coin-operated electricity meters and chipped whisky glasses somewhere off the Edgware Road. That is not to paint modern London as paradise: not with a spate of shootings, congestion, dirty streets and expensive housing. But while announcing at a party that one worked abroad once elicited coos of envy, now it merely provokes bafflement: why would you live anywhere else than London?
If this sounds jingoistic, London's rebirth is not a singularly British triumph, for the capital often appears to be in opposition to its country. The slick metropolitanism of Tony Blair and David Cameron can jar with Middle England. London is Athens, the city state making decrees that the surrounding countryside obeys sulkily.
And like Athens once did, London sucks in all talent. Look at its two finest football teams, Arsenal and Chelsea: both have fielded sides entirely bereft of Englishmen.
A Brit can feel like a foreigner in his own capital. Once New York was the world's melting pot, now it is London: 36 per cent of New Yorkers are foreign-born, against 40 per cent of Londoners. While bidding for the Olympics, New York boasted 200 languages could be heard on the streets of the Big Bagel. It went silent when it learnt London echoes to 300.
How much immigration drives our economic revival is a moot point, but immigration is, incontrovertibly, a response to that revival. As well as the super-rich of Russia, the super-poor of Eastern Europe dream of the Thames Gateway as the promised land; hard to fathom, but the London Eye has taken on the iconography of the Statue of Liberty.
The M25 - the nearest we now have to a city wall - encircles the largest professional population on the planet, with more flying in every day via our five airports than to any other city. With such an educated workforce, no wonder more books are published here than in any other city.
London might look like Paris's plain friend across the water, but when presidential candidate Nicolas Sarkozy sought support from the French elite he came to London, the seventh-largest French city. More than 300,000 French people live in Britain, with South Kensington resembling a mini-Paris. Sarkozy praised London to the clouds, promising Thatcherite tax cuts and urged Frenchies to return to Paris - to make it like London. To appreciate the change, imagine Jacques Chirac doing that when he ran for president seven years ago.
Russian plutocrats are just the latest out-of-towners to like the country so much they bought it. It was made possible by Gordon Brown's decidedly un-socialist, un-Presbyterian decision to exempt foreign swanks from the inconvenience of paying tax on income earned abroad. Lakshmi Mittal (worth £14.8 billion) and Roman Abramovich (a mere £9.1 billion) are among 11 foreign-born London billionaires, augmenting our 12 native billionaires.
It is this openness to outsiders that many think has enabled London to eclipse New York. After 9/11, America turned inwards, reducing immigration that for so long had stoked its economy. It also introduced humiliating airport checks that outrage foreign businessmen. Not that we can be smug in "Londonistan": it would be futile to put up such security blankets here - we know that the terrorists are already among us.
The rise of London at New York's expense cannot be attributed to immigration alone. London has been helped by a lighter regulatory framework, which attracts jealous glances from across the pond. While Wall Street once swarmed with ticker tape, now it is red tape - a response to the Enron and WorldCom scandals.
New York's mayor, Michael Bloomberg, so fears that London is "rapidly gaining ground" that he has commissioned a report: London, he suggests, threatens the very future of America. If we really can become the dominant power of world finance, then imperial London will be reborn; and every indication is that it can.
A 2005 survey of financial types scored international cities and London won easily, beating New York in all bar one category. The City employs a smidgeon under Wall Street's 328,000 souls but is gaining fast. Some 367 companies floated in London over the past year, raising £29 billion - against 270 in New York, yielding £28 billion. London has the most foreign banks, 70 per cent of the world's secondary bond market and half the derivatives market. It is home to foreign-exchange trading and 80 per cent of Europe's hedge funds.
Our private equity firms raised £20 billion last year, and our law firms - the world's biggest - contributed £11 billion. If last year's record £9 billion bonus celebrations seemed muted after the cork-popping excess of the 1980s it is because then wealth was novelty, now it is normality. Even the head of Goldman Sachs spends half his time in the identical London office he has had built to match his New York one.
Such are the tremors the world still feels 20 years after the Big Bang set the City free.
A decade ago, it would have seemed fanciful that we could usurp New York as the world financial capital, when the smart money was predicting London's eclipse by Frankfurt as Europe's financial capital. Instead, Deutsche Bank moved the global headquarters of its investment banking division to London and Frankfurt is a smaller financial centre than Canary Wharf. Britain's refusal to join the Euro prompted many to write London's obituary, but even that has proved another opportunity, with 80 per cent of trade in the currency occurring here. With plummy Brits dominating the burgeoning asset management business for the world's super-rich, we are becoming Zurich-on-Thames.
And boy, is all that felicitous, filthy lucre affecting London life. It has fed a salivating atavism that makes the Beckhams' lifestyle look positively spiritual. And there is much more than City money sloshing around Bond Street and Burlington Arcade. Sotheby's has sold £167 million of paintings in the past week, including a record £94.9 million for a single sale, while Christie's sold Francis Bacon's Study for Portrait II for £14 million. The same big money is being paid for anything that smacks of luxury. Theo Fennell, jeweller to Elizabeth Hurley and Elton John, reports a seven-fold increase in pre-tax profits.
All this loot has achieved the impossible and turned London into a world gastronomic centre, too. In his novel Hawksmoor, Peter Ackroyd described foul meals of eels, the "noise and the vapours of the Ale House"; now London exports food. And how: Gordon Ramsay opens a restaurant in Manhattan - called "London".
Even our cocktails are better, apparently. Audrey Saunders of Manhattan's great Pegu Club sighs: "I hate to admit it, but London is the best cocktail city in the world."
Our splurge on fripperies is trifling against money being sunk into property: a pied-à-terre off Knightsbridge is rapidly becoming pricier than some spaciously appointed African state in need of modernisation. With London's population rising to 7.5 million and the housing stock almost static, prices are heading so far north they are positively Arctic. Four flats in Hyde Park are up for £84 million each, and folk are fighting for them.
Apartments around Central Park can be snaffled for £1,400 per sq ft, but Belgravia pads often exceed £3,000 a sq ft, up 35 per cent in a year. Here, natives with a couple of million who would be called rich anywhere else can't compete against foreigners who think nothing of upping a bid by a million. In London the average home costs £500,000, after rising 11.3 per cent in 2006.
The easiest way to spot a city's vitality is to look for cranes, and the City is creaking with them. Exciting new edifices will include London Bridge's 72-storey "shard of glass". But while money underpins London's resurgence, its attraction also rests on much that at least starts as anti-commercial. For a city superficially conservative, London is a haven for quirky, anarcho-weirdos. That was evident at London Fashion Week.
The "Shard of Glass" in London will be Europe's tallest building
Anna Wintour, editor of American Vogue, flew in declaring: "I come to London for ideas, not for clothes to wear." Even American-owned Vanity Fair concedes: "London produces three-quarters of the fashion ideas for the rest of the world."
Paul Smith, John Galliano, Alexander McQueen, Hussein Chalayan and Sophia Kokosalaki all shot to prominence at LFW. And now the big boys are seeking a bit of that credibility. For the first time, the man they call the designers' designer, Marc Jacobs, sashayed into collections that used to be the ugly duckling of international style, following in the footsteps of Giorgio Armani last season. Once, such an event seemed as likely as the Duke of Westminster settling in Wigan.
If anything, the eccentric London art scene is even more thriving. You don't have to adore everything in Tate Modern - which, with the Gilbert and George retrospective, literally includes excrement - to realise it is the world's most vital showcase for contemporary art, just as New York's Museum of Modern Art once was. And as for theatre, we started to fear that, dominated by sickly musicals, it would never make a recovery. Now it bursts with challenging news plays. Hollywood actors - from Kevin Spacey down - make their bucks Stateside, but in some curious way feel validation requires critical approval on our boards. David Hare's experience of opening The Vertical Hour in New York left him reflecting that Manhattan was "artistically much more conservative. There is a definite feeling of being bored with the old, yet even more terrified of the new." Not so London.
There was little left of British film to revive, so the burgeoning celluloid industry is essentially new. In 2005, a record 12,655 days of shooting took place in London, many with that quintessential New Yorker Woody Allen mooning over Scarlett Johansson in Match Point under the leaden London skies he has fallen in love with. Even the Baftas - once mildly less significant than a Blackpool wet T-shirt contest - now set the agenda for the Oscars. And to complete a remarkable week, the crème of international rockers such as the Killers and the Red Hot Chili Peppers played at the Brit awards, alongside local troupers Oasis.
Remarkably, London's rise has been in spite of, rather than because of, government. Just think what London could be without high taxation, terrible transport and even worse social services. Moreover, Mayor Ken Livingstone has often appeared keener posturing than governing. We need a Rudy Giuliani.
And the danger ahead? Even Athens fell in the end, as confidence lapsed into decadence. Only London spawns companies such as Quintessentially, a concierge service satisfying an elite's outlandish demands: a dozen albino peacocks for your party tonight? Certainly, sir.
We know the Olympics will prove a financial disaster. Eventually, the cavalcade will move on, history flowing down the Thames to some other city of human possibility. But for now, as London's biographer Ackroyd smiles: "If London were a living thing, we would say that all of its optimism and confidence have returned - the capital of all capitals again."
telegraph.co.uk
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