Job fears hit City of London morale

The wine bars in the City of London are still packed with traders and bankers, but their conversation is muted.

In just eight weeks the mood in the Square Mile has gone from an exuberant high fuelled by four years of unprecedented deal activity to a dispirited low following the US subprime crisis.

The collapse of private equity deals, the shutdown of the debt markets, the crisis surrounding Northern Rock and a string of bad third-quarter investment banking results have left traders and bankers fearing for their jobs.

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