Should We Re-enact Glass-Steagall?

[Polk]

Only two provisions were repealed. Those provisions had zero to do with the financial crisis.

That's pretty clearly false. It repealed three whole subsections of U.S. Code. You're going to tell me those three subsections contained two provisions between them?

What sections are you talking about. Only Section 20 and 32 of Glass Steagall was removed. Whatever sections of the US Code you are referring to is probably just as unrelated to the problems as Glass Steagall was.

That's simply not true. Those two sections are ones frequently pointed to as being ones that were problematic to repeal, the Gramm-Leach-Bliley repealed more than that.

 

[AmazonTania]

That's pretty clearly false. It repealed three whole subsections of U.S. Code. You're going to tell me those three subsections contained two provisions between them?

What sections are you talking about. Only Section 20 and 32 of Glass Steagall was removed. Whatever sections of the US Code you are referring to is probably just as unrelated to the problems as Glass Steagall was.

That's simply not true. Those two sections are ones frequently pointed to as being ones that were problematic to repeal, the Gramm-Leach-Bliley repealed more than that.

We are talking about Glass-Steagall, not other laws which are just as non-influential.

 

[Polk]

I'm talking about Glass-Steagall. You're the one who thinks that those were the only two provisions because they are ones frequently discussed.

 

[AmazonTania]

I'm talking about Glass-Steagall. You're the one who thinks that those were the only two provisions because they are ones frequently discussed.

Gramm-Leach-Bliley only focused on two provisions of the Banking Act of 1933. I don't know which provisions you are talking about, but whichever they are they were repealed or replaced before or after this act. Nonetheless, you still have yet to name this provision.

 

[Polk]

That's just not true. You're changing your wording now to "removed" so you can say provisions that were substantially repealed (16 and 21) weren't actually repeated because they're still technically on the books (but so substantively amended as to be meaningless).

 

[Toddsterpatriot]

Say what? "Cut the size of institutions"? You mean government control of corporations? Can you spell fascism?

You've got it backward. Fascism is corporate control of government, which is what we have going on now.

That's why Glass-Steagall must be reinstated.

Yes, we must bring back Glass-Steagall because it prevented banks from making bad mortgage loans. Wait, what?

Never mind, it would have had zero impact on the crisis.
Bringing it back is a stupid idea.

 

[Polk]

Say what? "Cut the size of institutions"? You mean government control of corporations? Can you spell fascism?

You've got it backward. Fascism is corporate control of government, which is what we have going on now.

That's why Glass-Steagall must be reinstated.

Yes, we must bring back Glass-Steagall because it prevented banks from making bad mortgage loans. Wait, what?

Never mind, it would have had zero impact on the crisis.
Bringing it back is a stupid idea.

Yes, I'm sure letting banks take consumer deposits and placing them on a roulette wheel had no impact at all...

 

[Toddsterpatriot]

You've got it backward. Fascism is corporate control of government, which is what we have going on now.

That's why Glass-Steagall must be reinstated.

Yes, we must bring back Glass-Steagall because it prevented banks from making bad mortgage loans. Wait, what?

Never mind, it would have had zero impact on the crisis.
Bringing it back is a stupid idea.

Yes, I'm sure letting banks take consumer deposits and placing them on a roulette wheel had no impact at all...

I know, putting them on that "bad mortgage" roulette wheel was a bad idea.
How would Glass-Steagall have prevented those bad loans?
Spell it out.

 

[Polk]

Yes, we must bring back Glass-Steagall because it prevented banks from making bad mortgage loans. Wait, what?

Never mind, it would have had zero impact on the crisis.
Bringing it back is a stupid idea.

Yes, I'm sure letting banks take consumer deposits and placing them on a roulette wheel had no impact at all...

I know, putting them on that "bad mortgage" roulette wheel was a bad idea.
How would Glass-Steagall have prevented those bad loans?
Spell it out.

Because it's far more difficult to make them profitable. It only makes sense to issue these mortgages when you can package them into investment vehicles and sell them. That was much more difficult to do when you didn't have investment arms in-house.

 

[AmazonTania]

That's just not true. You're changing your wording now to "removed" so you can say provisions that were substantially repealed (16 and 21) weren't actually repeated because they're still technically on the books (but so substantively amended as to be meaningless).

You're playing semantic. All I have said was the Gramm-Leach-Bliley act only repealed two provisions of Glass Steagall. Much of Glass Steagall is still in effect. The Government agency which was created under Glass Steagall is still in effect.

According to you, the act repeal three sections of the U.S. Code. I'd like to know what those sections were, if you don't mind.

 

[Toddsterpatriot]

Yes, I'm sure letting banks take consumer deposits and placing them on a roulette wheel had no impact at all...

I know, putting them on that "bad mortgage" roulette wheel was a bad idea.
How would Glass-Steagall have prevented those bad loans?
Spell it out.

Because it's far more difficult to make them profitable. It only makes sense to issue these mortgages when you can package them into investment vehicles and sell them. That was much more difficult to do when you didn't have investment arms in-house.

Banks sold mortgages under GS, packaged or not.

 

[AmazonTania]

Yes, I'm sure letting banks take consumer deposits and placing them on a roulette wheel had no impact at all...

I know, putting them on that "bad mortgage" roulette wheel was a bad idea.
How would Glass-Steagall have prevented those bad loans?
Spell it out.

Because it's far more difficult to make them profitable. It only makes sense to issue these mortgages when you can package them into investment vehicles and sell them. That was much more difficult to do when you didn't have investment arms in-house.

You do understand that the investment/commercial banks who stayed separate got into just as big of trouble as the banks who merged, right?

Glass Steagall didn't make anything more difficult. It's a red herring. And people who do not understand the Banking Act of 1933, or the cause of the crisis will make these mistakes very often.

 

[Polk]

That's just not true. You're changing your wording now to "removed" so you can say provisions that were substantially repealed (16 and 21) weren't actually repeated because they're still technically on the books (but so substantively amended as to be meaningless).

You're playing semantic. All I have said was the Gramm-Leach-Bliley act only repealed two provisions of Glass Steagall. Much of Glass Steagall is still in effect. The Government agency which was created under Glass Steagall is still in effect.

According to you, the act repeal three sections of the U.S. Code. I'd like to know what those sections were, if you don't mind.

You're the one that's playing semantics by dipping back and forth between "repeal" and "remove".

The three subsections repealed were 12 USC 78, 12 USC 377, and 15 USC 80.

 

[Polk]

I know, putting them on that "bad mortgage" roulette wheel was a bad idea.
How would Glass-Steagall have prevented those bad loans?
Spell it out.

Because it's far more difficult to make them profitable. It only makes sense to issue these mortgages when you can package them into investment vehicles and sell them. That was much more difficult to do when you didn't have investment arms in-house.

Banks sold mortgages under GS, packaged or not.

Yes. However, it's was more difficult and thereby less profitable.

 

[Polk]

I know, putting them on that "bad mortgage" roulette wheel was a bad idea.
How would Glass-Steagall have prevented those bad loans?
Spell it out.

Because it's far more difficult to make them profitable. It only makes sense to issue these mortgages when you can package them into investment vehicles and sell them. That was much more difficult to do when you didn't have investment arms in-house.

You do understand that the investment/commercial banks who stayed separate got into just as big of trouble as the banks who merged, right?

Glass Steagall didn't make anything more difficult. It's a red herring. And people who do not understand the Banking Act of 1933, or the cause of the crisis will make these mistakes very often.

They make these "mistakes" because those "mistakes" aren't mistakes at all. They are, in part, what caused the crisis. They're not allow sufficient to explain the crisis, but no set of factors is. The problem is that the list of "causes" coming from your side of the aisle bare no relationship to reality.

 

[Toddsterpatriot]

Because it's far more difficult to make them profitable. It only makes sense to issue these mortgages when you can package them into investment vehicles and sell them. That was much more difficult to do when you didn't have investment arms in-house.

Banks sold mortgages under GS, packaged or not.

Yes. However, it's was more difficult and thereby less profitable.

You're right, GS wouldn't have prevented these bad loans.
Look at what Countrywide did......what were they again?
Bank.....Investment bank.....something else.....?

 

[AmazonTania]

That's just not true. You're changing your wording now to "removed" so you can say provisions that were substantially repealed (16 and 21) weren't actually repeated because they're still technically on the books (but so substantively amended as to be meaningless).

You're playing semantic. All I have said was the Gramm-Leach-Bliley act only repealed two provisions of Glass Steagall. Much of Glass Steagall is still in effect. The Government agency which was created under Glass Steagall is still in effect.

According to you, the act repeal three sections of the U.S. Code. I'd like to know what those sections were, if you don't mind.

You're the one that's playing semantics by dipping back and forth between "repeal" and "remove".

Repeal is the removal or reversal of a law. There is no dipping back and forth. For whatever reason, you seem to think my choice of words adds clout to your position.

The three subsections repealed were 12 USC 78, 12 USC 377, and 15 USC 80.

How is 15 USC 80 repealed? It's still in the books... Aside from the fact that this has zero to do with the Banking Act of 1933 or 1935.

15 USC § 80a?3 - Definition of investment company | Title 15 - Commerce and Trade | U.S. Code | LII / Legal Information Institute

 

[AmazonTania]

Because it's far more difficult to make them profitable. It only makes sense to issue these mortgages when you can package them into investment vehicles and sell them. That was much more difficult to do when you didn't have investment arms in-house.

You do understand that the investment/commercial banks who stayed separate got into just as big of trouble as the banks who merged, right?

Glass Steagall didn't make anything more difficult. It's a red herring. And people who do not understand the Banking Act of 1933, or the cause of the crisis will make these mistakes very often.

They make these "mistakes" because those "mistakes" aren't mistakes at all. They are, in part, what caused the crisis. They're not allow sufficient to explain the crisis, but no set of factors is. The problem is that the list of "causes" coming from your side of the aisle bare no relationship to reality.

These banks got in big financial trouble because they were heavily leveraged up with short term commercial paper and mortgage-backed securities. This was just as much of trouble with the merged banks and the ones which remained separate.

That is the reality. Glass Steagall wouldn't have prevented this. At all.

 

[The Rabbi]

You do understand that the investment/commercial banks who stayed separate got into just as big of trouble as the banks who merged, right?

Glass Steagall didn't make anything more difficult. It's a red herring. And people who do not understand the Banking Act of 1933, or the cause of the crisis will make these mistakes very often.

They make these "mistakes" because those "mistakes" aren't mistakes at all. They are, in part, what caused the crisis. They're not allow sufficient to explain the crisis, but no set of factors is. The problem is that the list of "causes" coming from your side of the aisle bare no relationship to reality.

These banks got in big financial trouble because they were heavily leveraged up with short term commercial paper and mortgage-backed securities. This was just as much of trouble with the merged banks and the ones which remained separate.

That is the reality. Glass Steagall wouldn't have prevented this. At all.

We had banking crises during GS. It didnt prevent anything other than banks making money, which people seem opposed to. They also seem opposed to banks not making money. Wish they could decide.

The issue is not deregulation, but regulation. With deposits insured banks have little incentive to be prudent with depositors' money. With bailouts as far as the eye can see they have no incentive at all. Remove all the Depression era regulation of banks and let the market sort out good from bad. It will punish bad players more effectively than any gov't agency.

 

[Sallow]

You do understand that the investment/commercial banks who stayed separate got into just as big of trouble as the banks who merged, right?

Glass Steagall didn't make anything more difficult. It's a red herring. And people who do not understand the Banking Act of 1933, or the cause of the crisis will make these mistakes very often.

They make these "mistakes" because those "mistakes" aren't mistakes at all. They are, in part, what caused the crisis. They're not allow sufficient to explain the crisis, but no set of factors is. The problem is that the list of "causes" coming from your side of the aisle bare no relationship to reality.

These banks got in big financial trouble because they were heavily leveraged up with short term commercial paper and mortgage-backed securities. This was just as much of trouble with the merged banks and the ones which remained separate.

That is the reality. Glass Steagall wouldn't have prevented this. At all.

That's astounding.

Sure Glass Steagall would have prevented what happened.

Handily.

These guys knew what they were doing..and they knew it could go horribly wrong.

So they took out insurance with AIG.

And they knew if that failed..the government would have to come in to save their asses because of FDIC.

Add in we had an administration that fueled the housing bubble by dropping interest rates to zero, defunding regulators, populating those regulators with vulture capitalists and encouraging entrepreneurship. That last part is important because in addition to having people doing home improvements via what they thought was a cheap loan, you had people opening up first time businesses by taking out mortgages.

This was a perfect storm caused by de-regulation.