Red Herring: Decline of Wall Street and the City

Fear about "finance" running away from New York and London because of regulatory burdens or growth outside the developed world is misplaced. Bankers like complaining about regulations and threatening to move elsewhere, but that's hard to execute. The slow pace of change is particularly true for the physical location of the top financial markets; the fact that Singapore does more bond issuances than London in a particular year doesn't mean it will soon overtake the City. Since the year 1600, there have been three top financial centers: Amsterdam, London, and New York. (Paris made a run in the 18th and 19th centuries.) Rapid and massive shifts in the way money is intermediated are unrealistic.

Click here for a complete copy of the Eurasia Group's Top Risks of 2010.

Click here for an overview of Eurasia Group's 2009 risk assessment.