Sep 27, 2008 01:52AM GMT
Question
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Politics - United States
Should we have kept the Glass-Steagall Act intact?
http://en.wikipedia.org/wiki/Glass-Steagall_Acthttp://www.investopedia.com/articles/03/071603.asp
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raves +1 posted Sep 27, 2008 04:16PM GMT
Answered Yes
It seems obvious that Glass-Steagall would of made this financial crisis not nearly as bad. Of course the commericial banks and Freddie and Fannie would still be in trouble because of the mortgage and housing issues. The purpose of the this Act was to separate Wall Street from Main Street. Clearly Wall Street (the big investment banking houses) was acting like commerical banks and thus part with Main Street. So yes, the Act It think would of made a difference...at least Bear Stearns, Merrill and Lehman maybe not have gotten into such a bad mess. -
raves +2 posted Sep 27, 2008 10:07AM GMT
Answered No
Glass-Steagall was passed to protect commercial banks from failure by forbidding them from investment bank practices like trading in securities and underwriting stocks and bonds. None of the recent failed institutions are commercial banks that got in trouble through risky investment banking. Instead, it is the commercial banks that are providing some stability to the system by purchasing troubled investment banks. Without Gramm-Leach-Bliley they would not even be allowed to technically do this.
The Gramm-Leach-Bliley Act replaced the GSA. The GSA also founded the Federal Deposit Insurance Company (FDIC) which is still in existance today.
http://blog.heritage.org/2008...
Hello Mr. Evans. It's good to see you back!
Answered No
Glass-Steagall was passed to protect commercial banks from failure by forbidding them from investment bank practices like trading in securities and underwriting stocks and bonds. None of the recent failed institutions are commercial banks that got in trouble through risky investment banking. Instead, it is the commercial banks that are providing some stability to the system by purchasing troubled investment banks. Without Gramm-Leach-Bliley they would not even be allowed to technically do this.The Gramm-Leach-Bliley Act replaced the GSA. The GSA also founded the Federal Deposit Insurance Company (FDIC) which is still in existance today.
http://blog.heritage.org/2008...
Hello Mr. Evans. It's good to see you back!