Back in the 1980s, Wall Street was beset with fear over Japan, which was rising out of the Far East, seemingly buying up all of New York and making deep in-roads on Wall Street. Names like Nomura and Daiwa loomed as possible rivals to the big bond dealers in Manhattan. It became a huge public policy issue, and Japan as a rising economic power was nothing short of cultural phenomenon. But then the malaise set in, and pretty soon we all moved on.

Now, are we in for a replay with China? According to Financial News, there is reason to believe that China has its sights set on the London financial industry.

"It appears Chinese banks believe that their moment to descend on London is fast approaching. Over the past two years, several have quietly built up their portfolios of prime office real estate, often close to the Bank of England building in the City of London. To date, these offices have only housed a small number of executives who have been relocated from China to London to gather information on the market and their competitors. However, there are now signs that this ‘information gathering' stage may be coming to an end. The phoney war is over. This month, one senior investment banker (said) that a Chinese firm had enlisted headhunters to look into the practicality of hiring several hundred investment bankers. The bank's domestic peers are understood to be close to following suit."

So is this a replay of the U.S. experience with Japan in the 1980s. Or is the looming might of China going to make the ultimate outcome much different?

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