Apr 24, 2012
Danielle Park, proprietress of www.JugglingDynamite.com joined FSN today for another far-ranging discussion of what's wrong with the global financial system. It seems not a lot has changed since the Great Depression, and the lessons which were learned during that debacle were slowly forgotten. As a result, limitations on banking activity and financial instruments gradually gave way to a climate of cowboy, crony capitalism. The banks, while receiving extremely generous privileges from the government were able to avoid all limitations on their behavior and business practices. After the passage of Glass-Steagall, commercial banks were prohibited from engaging in risky banking activity. They weren't allowed to expand to other states and could only engage in sound lending. Throughout the years, that all changed and eventually the banks became the masters of their own destiny, as well as everyone else's. Yet again, we now see how this science experiment has wound up. It's time to restructure the entire financial industry, get rid of the zombie banks, and the performance of basic function of capital allocation and character based lending.
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