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The more things change, the more they stay the same.


Anything that can get worse, will get worse. Especially if humans and money are involved.

Facts should matter, even to NY Times best selling authors

Interesting, but Prins misstates the relationship between commercial bankers and Glass-Steagall. Like most commentators on this topic, including politician such as Elizabeth Warren, she only has cursory knowledge of what Glass-Steagall actually achieved.

The primary discussion at the time Glass-Steagall was passed into law was whether there would be a complete ban on investment banking by commercial banks; and of course, the commercial bankers were all extremely eager to find creative ways to retain some investment banking abilities.

The reason they eventually supported Glass-Steagall, contrary to Prin's assertion, is because the statute allowed for limited investment banking rather than a complete bar. Section 20 of the Act prohibited nationally-charted commercial banking institutions from owning banks that are "engaged principally" in investment banking activities (trading in securities).

But as a result of a series of Federal Reserve Board decisions in the 1980's, the ever-expanding definition of "engaged principally" (from five to 25 percent) would become the route through which banks would re-enter the security industry - eventually leading to Glass-Steagall’s repeal with Gramm-Leach-Bliley as the "wall of separation" between investment banking and commercial banking had become a leaking dike.

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