Saturday, April 16, 2011

Bill introduced to reinstate Glass-Steagull

One of the key points that the recent financial crisis has demonstrated is that there is an need to separate investment and commercial banking. Investment banking is built on risk while commercial banking is built on safety. Allowing the combination of the two starting in the 1980's is the real root cause of our current financial crisis - enabling greedy risk prone practices to run amok in the traditionally prudent mortgage industry.

Glass-Steagull originally separated commercial and investment banking in 1933 after it became obvious that the catastrophic bank failures during the Great Depression were due to the jeopardy created by conflicting purposes.

Finally someone in Congress has come to their senses and introduced a bill to re-introduce the intent of Glass-Steagull. Help support HR.1489