Bankers are invited to watch a horror movie called Day of the MiFIDs. These are Brussels-based MiFIDs that became so enthused by the idea of a transparent market that they decided to implement it by force across the whole of the European empire.
Fruit sellers will be particularly squashed. From now on, if they sell a giant mango they must ensure that they have pricing not only from their own wholesaler but from every mango wholesaler across Europe and that they gave the customer the best price. In the old days, customers were required to walk round the block to compare the prices of market stall mangos with supermarket mangos and online mangos. Now the MiFID monster has decided that the fruit seller must bear sole responsibility for all of capitalism’s ills and for anyone getting over-ripe fruit going back five years.
In Day of the MiFIDs the banking community is blinded by a display of yellow shooting stars on a blue background. One or two escape, however, and discover that the IT upgrade needed to comply with MiFID costs €15m for a bank and €10bn for the entire industry. Fortunately, most of the industry has been wiped out so this reduces the outlay.
In the final scene, as a result of the MiFIDs, markets revert to barter.
I haven’t yet had the pleasure of seeing CityCompass Research’s film MiFID Revealed. But I am willing to bet that Day of the MiFIDs, still looking for a backer, is a more accurate reflection of reality.
