There are a lot of people chafing at the government's move to reform pay practices in the United States. But the measures by the British government so far have been much more draconian, and it's unclear how much more foreign banks will take.

The move to tax bonuses at 50 percent was a blow. But then came the announcement that bankers and traders must defer 60 percent of their compensation for a three-year period if they make more than one million pounds. This is unprecedented and you have to wonder if the government is making a huge mistake.

The country has been so proud of London's soaring financial status; many locals are sure their fair city has surpassed New York. But lots of banks are making noise about moving to other European financial centers. JPMorgan (JPM) and Goldman Sachs  (GS) seem to be the ones most serious about moving. But as in the United States, the backlash against the banks set in quickly. We'll see where this ends up. 

For more:
- here's a New York Times article

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