Glass-Steagall is the indispensable first step to global economic recovery. It will immediately halt the onset of hyperinflation, remove government commitment from bailing out toxic debts, end too-big-to-fail banks, and force a separation of commercial banking functions from investment banking functions, thus cleaning up the nation's banking system to make way for real, long-term investments.
There are now two bills in each house calling for the restoration of President Roosevelt's 1933 Glass-Steagall law. H. R. 129 & its Senate companion bill S. 985, introduced by Rep. Marcy Kaptur and Senator Tom Harkin respectively, and most recently, S. 1282, known as the "21st Century Glass-Steagall Act," championed by Senator Elizabeth Warren, whose companion House bill, H.R. 3711 was recently introduced on December 11, 2013.
Texas Democratic Senate pre-candidate Kesha Rogers' organizing trip this past weekend to El Paso, a city of nearly 680,000, caught the attention of El Paso's largest English and Spanish-language newspapers.
Former U.S. bank regulator Dr. William Black of the University of Missouri took to Op-ED News yesterday with a hard-hitting column, 'The 11th Lesson We Need To Learn from Keating's Frauds: Bring Back Glass-Steagall.'
"History should have taught us how to get out of the crisis, and instead, we have not learned anything from the past. Banks should go back to banking, i.e. depositing savings, and managing savings and investments for the citizen, supplying the real economy,"
Prins tells Salon that, today,
"Bankers operate oblivious to the needs of national economies. There is no counterbalance to their power."
Moving the leverage ratio won't change anything, says Dr. Gerrald Epstein — only Glass Steagall will change the fact that today's banks do nothing for the real economy...
On March 31, 2014 Resolution K1012 was introduced into the New York State Assembly as K1012 urging the New York State Congressional delegation to support efforts to reinstate the Glass-Steagall separation of banks. The resolutions main sponsor is Phil Steck, who also introduced the bill last year. There are 13 official co-sponsors.
The full text of the resolution reads:
The British keep trying to postpone the deadly austerity blow of a "full bank bail-in system" until they have seized full political control of the resulting collapse by nuclear war confrontation.
Former BIS chief economist William White sees a bank crash coming, in an interview published today by the Swiss financial paper Finanz und Wirtschaft, and headlined "I see the same price bubbles as in 2007".
White, an American economist now resident in Texas, says:
"not just the U.S.
Fears about the impact of QE and the awful state of the banks could be
"likely to reopen the U.K.'s debate about the need to impose a Glass-Steagall split between retail-commercial banks, where firms and households store their deposits, and investment banks, which take big risks,"...
How It Works
Since 1999, banks have been allowed to use commercial deposits and assets as fuel for securities trading on the derivatives market.
Because commercial and speculative assets are so heavily comingled, the government is forced to protect the assets of banks making risky bets through near perpetual bailouts and purchasing of toxic debt.
It was the derivatives bubble that blew up the system and bankrupted the US banks in the 2007-2008 crash.
1. Commercial Banking institutions have one year to divest themselves of all non-commercial banking units, with no cross management or ownership between commercial and non-commercial units.
2. Commercial Banks are barred from using more than 2% of its capital for the creation, sale, or distribution of securities (certain bank-qualified securities are exempted)
3. Prevents Commercial Banks from loaning their commercial deposits into such vehicals as would support the creation and circulation of securities.
4. No securities of low or potentially low value can be placed by a bank into its insured commercial bank units.
* Adds provision stating Glass-Steagall is the preeminant regulator of the banks, limiting banks from putting its depositors and shareholders at risk.
Glass-Steagall forces separation of commercial from investment banks, it ends Too Big To Fail, bars government bailouts, and will stop the onset of hyperinflation.