In London the watchword is Bonus is back

It is said that the atmosphere has changed in London. Suddenly, the City, re-hashing "Apocalypse Now" for two years, began to play "La Dolce Vita". As before. All around the world has changed, but the "perfidious Gherkin" pretended to ignore it. Even if the banks will be catching up by the patrol. Namely the Basel Committee - the forum of the international banking regulators-, windsurfing walk forced in a new world financial order.

Everyone is in agreement, limit leverage and increase own funds from risky positions. The Americans, the Europeans on the continent and even the British are favourable. The consensus is at hand.

What is happening in London - and Wall Streetis both immoral and dangerous. There is no reason that Goldman Sachs - which would have "jumped" If the US Government had not intervened - may consider to pay record bonuses to its teams this year. The Barclays, Citigroup and other credit Switzerland dive again in guaranteed bonuses, without provision of performance without deferred compensation. Despite all the codes of good conduct.

All this with money easily won. Their currency The banknotes manufactured in the string by the Fed and the ECB to try to boost the supply of loans. And banks to replace these liquidity friend price on State paper, well-paid. Very tiring step.

Elsewhere too, margins can be traced, primary business volume explode, when wage costs and prices of blankets, through CDS (credit default swaps"), have melted. Banks are recovering to invest in choir - you said "sheep" -on trades in vogue, the shares, rates, raw materials and even the credit markets. In London, the watchword is: "Bonus is back."But the truth would be rather: "bubble is back."

Methods exist, however, to better align the interests of the Bank and its employees. At HSBC, for example, fifteen leaders of the Bank for investment and market have their future bonus linked to the recovery of the losses of 2008 ("claw back"). BNP Paribas has put in place, last year, a highly restrictive system of remuneration. The salary of the patterns is only the tip of the iceberg. But when Stephen Hester, the new boss of Royal Bank of Scotland (RBS), in which the British taxpayer has injected 20 billion pounds, has faced the prospect of a staff of 9.6 million jackpot, it is easy to imagine what is happening: the well understood each interest.

One of the leaders of banks is getting salary packages of traders, to justify their own rehabilitation. But why leaving Downing Street to do On the one hand, Gordon Brown and Alistair Darling go of their verse on evil bankers and the need to dry bread, and, on the other, they leave RBS - which public authorities hold 70 - distribute unreasonable bonus guarantees, as objection all its competitors.

Bizarre Not if it will replace in the context of a general election in less than a year the United Kingdom. The Labour Government dream, indeed, to sell a package of RBS shares prior to the popular vote to demonstrate to the British opinion how well managed the crisis. At the time, Stephen Hester has the flange on the neck, with mandate implied boost results in the short term, to escalate the action.

In view of this, greet him, the French Government follows a much more convincing line. For example, putting pressure on the Société Générale - which received 1.7 billion euros of public money - to give up a plan of stock options for executives. Above all, by pushing the European agenda for the regulation, with its German partner. This leadership is important and recognized. But Paris must be wary of the large political effects of channel. The European directive on "hedge funds", for example, clearly dictated by electoral requirements, is chock full of technical imperfections.

Brussels seems in a hurry to adopt the directive on the own funds of banks before even that the Basel Committee has completed its current overhaul of Basel II, the body of standards work. Is - this desirable To tackle the capital banks is a dry, complex, subject that determines the supply of credit. A simplistic view of the famous "credit default swaps", or "re-securitization", can cause major activity transfers. Especially if the reform leaves the United States on the dock of Basel II, even Basel I. It is important to set new rules of the game and to give a timetable. Quickly and together.