Finance and investment

Wealth (and poverty) are relative concepts. Despite its relative economic decline, Britain is still one of the wealthiest places in the world. The empire has gone, the great manufacturing industries have nearly gone, but London is still one of the centers of the financial world. The Financial Times-Stock Exchange Index of the 100 largest British companies (known popularity as the “Footsie”) is one of the main indicators of world stock market prices.

The reason for this is not hard to find. The same features that contributed to the country’s decline as a great industrial and political power – the preference for continuity and tradition rather than change, the emphasis on personal contract as opposed to demonstrated ability when deciding who gets the important jobs – are exactly the qualities that attract investors. When people want to invest a lot of money, what matters to them is an atmosphere of stability and feeling of personal trust. There are the qualities to be found in the “square mile” of the old City of London, which has one of the largest concentrations of insurance companies, merchant banks, joint-stock banks and stockbrokers in the world. As regards stability, many of the institutions in what is known as “the City” can point to a long and uninterrupted history. Although there have been adaptations to modern conditions, and the stereotyped bowler-hatted “city gent” is a thing of the past, the sense of continuity, epitomized by the many old buildings in the square mile, is still strong. As regards trust, the city has a reputation for habits of secrecy that might be thought of as undesirable in other aspects of public life, but which in financial dealings become an advantage. In this context, “secrecy” means “discretion”.

Currency and cash

The currency of Britain is the pound sterling, whose symbol is “Ј”, always written before the amount. Informally, a pound is sometimes called a “quid”, so £20 might be expressed as “twenty quid”. There are 100 pence (written “p”, pronounced “pea”) in a pound.

The one-pound coin has four different designs: an English one, a Scottish one, a Northern Irish one and Welsh one (on which the inscription on the side is in Welsh; on all the others it is in Latin).

In Scotland, banknotes with a Scottish design are issued. These notes are perfectly legal in England, Wales and Northern Ireland, but banks and shops are not obliged to accept them if they don’t want to and nobody has right to demand change in Scottish notes.

Before 1971 Britain used the “LSD” system. There were twelve pennies in a shilling and twenty shillings in a pound. Amounts were written like this: £3 12s. 6d. (three pounds, twelve shillings and sixpence). If you read any novels set in Britain before 1971, you may come across the following:

A farthing = a quarter of a penny

A ha’penny (halfpenny) = half of a penny

A threepenny bit = threepence

A tanner = an informal name for a sixpenny coin

A bob = an informal name for a shilling

A half crown = two-and-a-half shillings (or two and sixpence)

People were not enthusiastic about the change to what they called “new money”. For a long time afterwards, the question “what’s that in old money?” was used to imply that what somebody had just said was too complicated to be clear. In fact, money provides frequent opportunities for British conservatism to show itself. When the one-pound coin was introduced in 1983, it was very unpopular. People said they were sad to see the end of the pound note, which it replaced, and that a mere coin didn’t seem to be worth as much. Another example is the reaction to the European euro. Since 1991 this has had the same status in Britain as Scottish banknotes have in England. But the first signs were that most shops and banks were refusing to accept them.