Forum Post: Break up the Banks! (The Glass-Steagall Act)
Posted 13 years ago on Dec. 13, 2011, 2 a.m. EST by riethc
(1149)
This content is user submitted and not an official statement
There are two bills in Congressional committee waiting to be brought to the floor of Congress: Marcy Kaptur's HR 1489 and Maurice Hinchey's HR 2451. If either of these two bills are passed by Congress, it will restore the Glass-Steagall Act, a law which had kept financial institutions separate, by enforcing by law that banks either be commercial banking institutions (mortgages, savings, etc.) or financial investment institutions (derivatives, CDOs, etc.).
Originally, this law came into being in 1933 during the Great Depression. Over time, its provisions had been eroded by many new laws until it was, for the most part, completely overturned in 1999 with the Financial Services Modernization Act (aka. the Gramm-Leach-Bliley Act).
Congressmen, such as Byron Dorgan, spoke on the floor of Congress before the vote on the Gramm-Leach-Bliley Act and warned that this would lead to a disaster in the financial system. (1) Dorgan goes as far a forecasting the collapse of the financial markets and the ensuing bailouts.
Now, over ten years after the repeal of Glass-Steagall, we can see the repercussions of removing the firewall between investment and commercial banking. Restoring the Glass-Steagall Act now, will break up the "too big to fail" banks and force them to sink or swim based on their own fiscal integrity.
No more bailouts for the banks. Support HR 1489 and HR 2451. Demand Glass-Steagall now!
Reference: 1. http://www.youtube.com/watch?v=OvnO_SH-4WU&feature=results_video&playnext=1&list=PL325E5EF5DAB7D072
It's too late for Glass Steagal. The banks must be nationalized, their records forensically examined, and all instances of fraud and other abuse prosecuted to the full extent of the law.
"On September 21, 2008 Goldman Sachs successfully applied to become a bank holding company. This subjects the firm to increased federal regulation and will reduce profit-making opportunities in the future. On the other hand, the move is designed to increase investor, creditor and client confidence in Goldman Sachs, largely by giving it ongoing access to emergency funding from the Federal Reserve's discount window."
To the tune of $814 billion (so far).
Nationalizing banks would be the end of the Federal Reserve system.
Exactly.
Glass-Steagall would not be the last move in the game of chess we are playing with 1%.
The Glass-Steagall was the first law that was repealed and it should be the first one restored.
Yes, yes, yes! Additionally please go to www.getmoneyout.com and sign the petition spread the word. Thank you.
This country has had many anti-monopolistic laws in the past, and look at where we are now. Nothing less that a constitutional amendment to end all funding for elections beyong a certain amount granted equally by government for all political campagins, and the end of corporations, to be replaced by private business ownership, will remove the problem.
I know next to nothing about the banking industry but from what little I have read Hedge funds and derivatives should be sold by casinos not by banks. No insurance companies should be insuring those bets! But still there sales and the companies insuring them continue!
Great post. Glass Stegall will divide them, and will impose position limits on investment banks.
Investment banks and FDIC insured commercial (lending) banks must be kept separated, or the investment banks will continue to dump their losses onto taxpayers.