Back in 1933 a piece of legislation now commonly referred to as the Glass-Steagall Act (named as such for Senator Carter Glass and Congressman Henry B. Steagall) sought to limit the scope of what a single bank could do. Simply put, the bill restricted commercial banks from engaging in the investment side of things and did so for more than 60 years. However the bill was repealed in 1999 with an act signed into law by President Bill Clinton. Following the banking crisis of 2008, that repeal has since gone on to become a scapegoat with many saying it helped contribute to the meltdown. So with the vilification of its repeal, could we see Glass-Steagall legislation return?
If the platforms for both major political parties are to be believed then the answer is “yes.” While there may not be a whole lot that the Democratic and Republican bases agree on these days, as MarketWatch notes, both parties have language in their 2016 platforms that call for modern versions of the Glass-Steagall regulations. Meanwhile President Bill Clinton’s repealing of the law has given ammo to both Bernie Sanders on the left and Donald Trump on the right in which to attack Secretary Hillary Clinton over what they say are her deep and sympathetic ties to Wall Street.
While it might seem like this issue will be all but a done deal when the new president and congress take office come January given its sudden bipartisan support, let’s not get too ahead of ourselves. For one, as we all know, what politicians say and what they do can be two entirely different things. Additionally there are still many very vocal detractors of any Glass-Steagall-esque legislation that might come down the pipeline.
One such opponent is Tony Fratto with the lobbying firm Hamilton Place Strategies. As he told MarketWatch, “Glass-Steagall is dumb politics and dumb economics… returning to Glass-Steagall would be destructive and unworkable.” Similarly others speculate that reinstating such regulations could wreak havoc on the market as the big banks are forced to break up. Although, as analyst Brian Gardner of Keefe, Bruyette & Woods warns, the risk of such legislation making its way into future revisions of the Dodd-Frank Act is currently being underestimated.
With the GOP holding their convention this week and the Democrats on deck for next week, it’s important to remember that these platforms and events are geared towards Main Streeters who will be heading to the voting booths in November. With that in mind it makes sense that both campaigns would want to distance themselves from Wall Street, so as to not look like their “bought and paid for.” Still, it wouldn’t be unreasonable to think that, after a near-20-year absence, Glass-Steagall legislation could reemerge in America sometime during the next president’s term.
I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded DyerNews.com in 2015 to focus on personal finance and the emerging FinTech markets.
A FinTech that specializes in creating credit card experiences is rolling out some new features. This week, Marqeta announced what it calls a "significant expansion" of its credit platform. This includes more than 40 new credit APIs that will further help clients craft and launch their own credit card products. Additionally, the company notes an updated intuitive dashboard. Using this platform, businesses can create unique card options that can not...
The popular platform PayPal is rolling out a new product built specifically for small businesses. Today, the FinTech announced the launch of The PayPal Business Cashback Mastercard. The new card will be issued by WebBank and marks the first time PayPal has offered a business credit card. With the PayPal Business Cashback card, business owners will be able to earn 2% cashback on all purchases. This earning rate is not...
A new rewards credit card is on the way from Wells Fargo. Today, the bank introduced its Autograph card, which expands the company's refreshed card portfolio. In terms of rewards, the Wells Fargo Autograph Card will earn 3 points per dollar spent in a number of categories. These include restaurants, travel and transit, gas stations, select streaming services, and phone plans. All other purchases will earn 1x points. Beyond the...
Put simply, the value proposition of Pay with GasBuddy is that you can use a special card that's accepted at most gas stations in order to save a few cents off of every gallon of gas you buy. That sounds good — almost too good, if you think like me.
Over the past few months, I've been a bit torn. While I love saving money and keeping costs down, the convenience of grocery delivery has proven too powerful for me to resist. Now one of my favorite discount grocery stores is rolling out a better option with the introduction of Aldi Curbside Pickup. Yet, the question still remains: is this option actually worth it?
Over the past few years, the free credit score site Credit Karma has expanded into other aspects of finance. This includes offering an unclaimed funds finder as well as a free tax filing platform— which it recently announced would be sold off to Block Inc (formerly Square) when Intuit's purchase of Credit Karma is completed. Now, Credit Karma is rolling out a free checking account in the form of Credit...
A few short weeks ago, I shared my review of an app called Current Rewards that allows you to earn gift cards and cash just for listening to music (although you'll need to do a bit more if you want to really earn points). As I noted in that review, I was first made aware of the app's existence thanks to an ad I saw for the Mode Phone. Well,...
First the bad news: considering all the major data breaches that have hit retailers, websites, and freaking credit bureaus alike, there’s a very strong chance your personal info has been compromised at some point. Luckily, in addition to steps you can take, such as freezing your credit reports to prevent criminals from using this data, there are a growing number of tools you can use to foil thieves in the...
Comments are closed.