Michael Sherwood, co-CEO of Goldman Sachs International, has made a short film, just released, (you can see it here) in which he lays out his thoughts about London, the European Union, and Britain withdrawing from the European Union.
Sherwood’s thoughts about the latter are already known – he doesn’t think the U.K. should be withdrawing from the EU, but today he reiterates his point a little more forcibly.
Reading between the lines, this is our suggested meaning of Sherwood’s statement this afternoon.
- “I joined Goldman Sachs in 1986. It was at the very beginning of Big Bang, the City was becoming the financial centre of the whole of Europe….”
Covert meaning: The City was a backwater before it became the financial centre of the European Union.
- “Our growth in Europe really was symptomatic of all our competitors’ growth – it really was the start of something big for the whole European market place.”
Covert meaning: The European Union drove growth of the whole European financial services industry. Without the European Union, Europe’s financial services industry would not have grown at the pace it did.
- “The biggest event that happened next was the advent of the euro in 1999. Suddenly, the European market became one huge integrated marketplace…the transparency and liquidity in this market have driven many large corporate transactions and been able to provide investors with interesting opportunities to invest.”
Covert meaning: A lot of bankers in Europe owe their existence not just to the European Union, but to the single currency.
- “The fact that this European market has been centered in Britain has been incredible for the service sector in the UK – not just the financial services sector, but everything that comes with it – consultancy, legal work, accountancy.”
Covert meaning: Leave the EU and it will not only be financial services jobs that will disappear in the UK.
- “London and the UK generally benefit enormously from this role as the financial services trading centre for Europe as a whole.”
Covert meaning” Leave the EU and jobs across the UK will vanish, this isn’t just London-centric.
- “The growth story of European capital markets is still in its infancy. We have a way to go in converting old bank debt, old bank loans into capital markets activity – whether through corporate bonds, asset backed lending or infrastructure. There are great needs for Europe as Europe continues to grow and capital markets in Europe will clearly finance that.”
Covert meaning: If the UK stays in London, there could be big opportunities for Goldman Sachs and more jobs at Goldman Sachs in London in future.
- “For capital markets activity to be based in London, the UK needs to play a realistic role as part of the EU.”
Covert meaning: If the UK leaves the EU, Goldman and others will withdraw thousands of jobs from London.”
- “The knock-on effect for jobs all over the UK [of the UK leaving the EU] and to the UK Exchequer are very important to this debate.”
Covert meaning: If it leaves the EU, the financial services industry will unravel and the UK will go bust.