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View Diary: Book Review: Kevin Phillips' "Bad Money" (143 comments)

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  •  sadly so. re: (1+ / 0-)
    Recommended by:

    "Since the Financial Services Modernization Act of 1999 dissolved old legal separations and constraints, commercial banking, insurance, securities, and mortgage lending have intertwined like tossed four-colored linguine in a bowl."

    I think Phillips was talking about the elimination of the Glass-Steagall Act under President Clinton.

    It was irresponsible and eliminated the wall between commercial banks and the insurance business/investment banking/hedge funds etc.
    Banks no longer were limited to lending and borrowing but could now take on the risk of financial derivatives driven by greed over fees.
    I don't think anyone has a clue about the real risks behind these funky black box derivatives.

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