Glass-Steagall has now been obliterated

Discussion in 'Economy' started by gonegolfin, Sep 15, 2008.

  1. gonegolfin
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    gonegolfin Member

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    Check out the Financial Times article ...

    FT.com / In depth - Wall Street crisis hits stocks

    Did you catch the following little nugget?

    "The Fed also suspended rules that prohibit banks from using deposits to fund their investment banking subsidiaries."

    The Glass-Steagall Act (which was repealed in 1999) has now been completely obliterated. Might this have been the sweetener for Bank Of America to offer such a sweet price for Merrill Lynch Sunday evening (which was set to plunge to single digits Monday morning if they had not been purchased before the markets opened)?

    This is serious and has ramifications far beyond that of the Bank of America purchase of Merrill Lynch. This provides license to the banks to use depositor funds to aid its investing banking operations (offset losses). Depositor funds should be kept safe. But the exact opposite is happening all in the name of saving our financial institutions. For all the talk about stiffer regulations on financial institutions (translated - only when it provides more power to the Federal Reserve), this is the disintegration of a very important rule.

    What has happened in the last couple of weeks is absolutely stunning and should make people nauseous at the thought of providing more power to the Federal Reserve.

    Brian
     
  2. editec
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    editec Mr. Forgot-it-All

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    Don't worry, brian.

    If our banks lose our deposits chasing some bubble, we're FDIC insured.

    What could possibly go wrong?
     
  3. Paulie
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    Paulie Platinum Member

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    This is a joke, right Editec? I mean seriously, it was a blatant joke, right?

    You do realize how much the FDIC has available to it, as opposed to the total liabilities in personal banking deposits?
     
  4. Chris
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    Chris Gold Member

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    Yes, the Fed will just print more money.
     
  5. CA95380
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    CA95380 USMB Member

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    What could possibly go wrong? You jest, right?

    RTÉ Business: Bank of America buys Merrill Lynch
     
  6. dilloduck
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    dilloduck Diamond Member

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  7. CA95380
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    CA95380 USMB Member

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    Don't count your "duck eggs" yet! This is only the beginning. I am thankful that my money is NOT in a BoA! :eusa_eh:
     
  8. dilloduck
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    dilloduck Diamond Member

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    Cmon--I might get a free toaster out of the deal !
     
  9. CA95380
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    CA95380 USMB Member

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    You could end up "toasted" but I'm not sure it will be from a toaster you are given as a trinket. :eusa_whistle:

    :eusa_eh: Hmmmn ..... "Did American Indians really sell Manhattan for twenty-four dollars worth of beads and trinkets?" Something to think about, Duck.
     
  10. dilloduck
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    dilloduck Diamond Member

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    I didn't do nuthin to no injuns ! :eusa_whistle:
     

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