bump.
lets go step by step so you can understand it all.
And there is a much more recent experience than 1929 to serve as a cautionary tale. A financial deregulation bill was passed in the early 1980s under the Reagan administration, lifting many restrictions on the activities of savings and loan associations, which had previously been limited primarily to the home-loan market. The result was an orgy of speculation, profiteering and outright plundering of assets, culminating in collapse and the biggest financial bailout in US history, costing the federal government more than $500 billion. The repetition of such events in the much larger banking and securities markets would be beyond the scope of any federal bailout.
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How the Clinton Treasury Caused the Current Stock Market Fall (Intermingling of Businesses)
In 1998, Travelers CEO Sandy Weill and Citicorp head John Reed announced plans to merge their two financial powerhouses. There was one problem: U.S. law prohibited the merger of commercial banks with insurance companies and securities firms. The two companies were not deterred. A loophole in the law barring such combinations gave the two companies a two-year window before the merger ban would kick in. That would be plenty of time, they figured, to change a centerpiece of U.S. banking laws that had stood in place for more than 50 years.
There already was momentum in Congress in support of the financial deregulation that proponents supported under the misleading banner of “financial modernization.” But there were also major legislative blocks and hurdles, and no assurance of passage.
Enter Citigroup. Though Citicorp has opposed the deregulation bill, the merged Citigroup became its most important advocate, with Sandy Weill pitching a tent in the halls of Congress to lobby legislators.
Still, the bill remained mired in Congress, thanks to jurisdictional disputes among federal agencies, intra-industry conflicts and consumer group opposition.
Former Clinton Treasury Secretary Robert Rubin sealed the deal. After having left his Treasury Department post, but amidst negotiating his new terms of employment as chair of the management committee at Citicorp, Rubin brokered the final compromise to ensure passage of the financial deregulation bill.
While Citi’s top priority was an after-the-fact legalization of the tainted Citicorp-Travelers merger, much more was at stake — for both the financial industry and consumers. The bill has enabled not just this particular corporate combination, but the intermingling of businesses that were formerly, properly and prudentially, kept apart.
http://multinationalmonitor.org/mm2002/02april/april02editorial.html
Charles Keating, the felon who drove Lincoln Savings into the most expensive S&L failure in history ($3 billion) considered very important in stoppping Ed Gray the Senators :
Alan Cranston (D, CA), Dennis DeConcini (D, AZ), John Glenn (D, OH), John McCain (R, AZ), and Donald Riegle (D, MI). These men were dubbed the Keating Five.the Senate Ethics Committee investigation concentrated on the actions of the five senators implicated.
I don’t see Bush’s name!
Although the special counsel to the Ethics Committee advised the Senate that Senators Glenn and McCain were not substantially involved, months of testimony revealed that all five senators had acted improperly in varying degrees. All of these senators, however, continued to proclaim that they were not involved in any wrongdoing, and were just following normal campaign funding practices.
In the end, the Senate Ethics Committee concluded that Senators Cranston, DeConcini, and Riegle had substantially interfered with the federal regulators' enforcement processes at the request of Charles Keating. In August 1991, the Ethics Committee recommended to the full Senate the censuring of Cranston for reprehensible conduct. The other four senators were noted for questionable conduct. Cranston had already decided not to seek re-election, citing medical problems.
101 Congress: H.R. 5400 and S. 370 (1990)