Seven things we learned in Washington – and you won’t believe number five
In true clickbait style, Euromoney offers some highlights from this year’s IMF/World Bank meetings.
|Brexit was on everyone's lips in DC – not so Catalexit
1) Catalonia is so worrying that it can’t be talked about
Brexit is not popular at the IMF – no surprise there, but it is certainly a popular topic of discussion. Not so Catalexit. Hushed tones only, please. It’s not hard to understand why.
“Europe really doesn’t care about Brexit,” says one senior banker, but Spain is different.
Santander executive chairman Ana Botín was nearly bounced into commenting in her European CEO panel session, but swerved it. “Spain is a very attractive place to invest in…”
2) Jamie Dimon’s bitcoin problem is worse than we thought
Just one day after saying he wouldn’t ever talk about bitcoin again, Jamie Dimon talked about bitcoin again. And then he said he wouldn’t talk about bitcoin again.
He also said people would have been “scared shitless” opening the newspaper at any time in the past. And this after telling analysts earlier this year that he was fed up with the “stupid shit” Americans have to deal with. #MakingAmericaFunAgain
3) People really want CMU, but wonder if they’ll ever get it
There was real dismay in Washington at the way European capital markets union (CMU) is being handled, or not handled.
Officially, it remains very much on the EU agenda. The need has never been greater – but as Erste Bank CEO Andreas Treichl unhelpfully reminded everyone on Friday, there are only two countries in Europe with a capital markets culture: the UK, which is leaving the Union, and Switzerland, which was never in it.
The irony noted by many bankers is that the UK’s Lord Hill, in his former role as European Commissioner in charge of financial services, was the biggest champion of CMU but was also one of the highest profile casualties of the Brexit vote. Many say it is sorely lacking a similar cheerleader now.
4) A US infrastructure boom could hurt Belt and Road
Bit of an argument about this one among Washington delegates. The theory goes that as and when some serious progress is made on infrastructure development in the US, it will compete with at least some of the investment dollars that might have gone into China’s Belt and Road Initiative, the logic being that a developed market project would probably win out.
Not so, say some infrastructure specialists. There isn’t a competition for funds along those lines. The risk profiles are distinct and so are the funds allocated. Time will tell.
5) Brexit won’t happen
You won’t be surprised to hear this one is not definite. It might simply be a lot of collective wishful thinking. But many bankers at this year’s meetings reckon that there’s a growing chance that Brexit won’t end up happening – or at least it won’t look much like it if it does. The most optimistic think the growing Macron/Merkel relationship might end up producing a face-saving deal that lets Britain and the EU look like winners. It’s fair to say that’s not yet the consensus.
6) In DC, traffic cameras are big business
Washington speeding and red-light cameras pulled in $119 million of revenue in 2016. The top camera alone posted $13 million. Next year the IMF meetings move to Indonesia – how will the absence of the delegates’ fleet of tinted-window Suburbans affect DC’s income?
7) The W is where BNP Paribas gets cool out of its system
Conservative, restrained, humble, modest, etc. It’s hard to speak to a senior BNP Paribas banker without something along those lines cropping up. Racy it isn’t.
“We are not known as a fast money place,” one banker solemnly told Euromoney recently.
So how to explain their IMF party venue, the achingly cool bar atop the W? After all, HSBC manages to stay true to itself in the stately panelled interiors of the Jefferson. Perhaps it’s just the outlet that BNPP needs before another year of careful execution, without fanfare.
But what about next year, when the IMF meetings move to Bali? Volcanic activity could put paid to those plans, and Jakarta is being lined up as the back-up. BNPP better hope that doesn’t happen. Indonesia’s W is in… Bali.