The Return of the Glass-Steagall Act?

Valentin KATASONOV | 20.06.2013 | http://www.strategic-culture.org/news/2013/06/20/the-return-of-the-glass-steagall-act.html

A report flashed through the media recently about Iowa Democrat Senator Tom Harkin, who has introduced to the US Senate Bill No.985 on the reinstatement of the Glass-Steagall Act. This took place on 16 May on the 80th anniversary of the original Glass-Steagall Act. Its adoption, as well as its subsequent repeal, had an enormous influence on the development of both America’s and the world’s financial and banking systems...  The history the Glass-Steagall Act The history of the Glass-Steagall Act (hereinafter for brevity referred to as the GSA) dates back to the «roaring twenties» of the 20th century, when America was seized by a speculation fever that the banks played a key role in inflating. Money-lending bankers forgot about traditional credit operations and embarked on risky operations in the securities market. They acted as investor/speculators themselves and used their own credits to supply money to non-bank speculators, sharing with the latter the unprecedently high profits obtained from securities operations. It all ended in tears with the stock market crash of 1929, the development of the economic recession (which grew into a prolonged depression in the 1930s) and a banking crisis. At that time, one in five American banks sank to the depths together with investors’ deposits. This was the largest deposit confiscation in history, against which the current confiscation of bank deposits seems moderate. In the wake of these events, even the US Congress began to call increasingly for the nationalisation of banks.