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The repeal of the Glass-Steagall legislation (Banking Act of 1933) in 1999 deregulated and allowed banks to act as investment, commercial, and retail at will. T
by black6 9y ago
The repeal of the Glass-Steagall legislation (Banking Act of 1933) in 1999 deregulated and allowed banks to act as investment, commercial, and retail at will. That deregulation doomed us to the financial crisis a decade later and the "too-big-to-fail" atrocity that ensued.
- aeorgnoieang 9y agoThat's not supported by the evidence from what I've read.
- dsr_ 9y agoYou can find lots of references from the time of the repeal saying "this is a bad idea because this act was designed to prevent banks screwing around in the way that caused the Great Depression, and the inevitable result of repealing it will be to cause a similar problem". Then you can look at the CDO crisis less than ten years later and talk about correlation not being causation until you're blue in the face. Here's another prediction: the destruction of the CFSB will lead to anti-consumer behavior at large banks.
- maxxxxx 9y agoThe bailouts certainly would have been easier if retail and investment banking had been separate. With the current state the investment bankers can hold everyone hostage because they may also blow up regular bank accounts.