Curbing Banker Bonuses to Wreck the Recovery, Who's Recovery is it Anyway?

Well, I've heard it all now. Estate Agencies in London are saying that the tax on banker bonuses will wreck the recovery in the prime sector of London, which will spill over into the rest of the market and wreck the recovery throughout the UK housing market.

"We were relying on City bonuses coming in to support the prime London market next year as more supply is expected to come through," Lucian Cook of Savills said.

In other words: we were going to be quite happy lining our pockets on the big sales, in the same kind of market that led to the crash, which has left much of the country swimming in debt with a house worth less than they paid for it.

They might want the market to once again by propped up by a sector as volatile as banking, fuelled by the even more volatile stock market, but the rest of us probably don't. The thousands of first time buyers unable to afford a property in the capital because they were unlucky enough not to work in the "city", probably don't either.

In fact if one good thing comes out of this downturn, it will be that we have been given the chance to break the financial districts hold on the property market. Another good thing would be financial regulation that caused prices to grow at an unrealistic rate in the rest of the country and the world but we are still waiting on that.

Savills said long before the government's attempt to curb the bonuses that it expected house prices in the UK to fall throughout next year, but according to their current statements they obviously thought: ah, who cares if prices fall up and down the country, we'll still have the bankers paying multi-million sums for a property that is only that amount because it is in a banker's district and bankers once again have money to burn.

I congratulate Darling, a lot of people thought he wouldn't have the bolcheviks to follow through on the tough statements, but as his opposite number with the Lib Dems pointed out: there is nothing to stop the bankers paying out the silly sums of money in increased salaries.

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