It’s a reminder and good article to reference in today’s financial crisis. What most people don’t know is that Citigroup was in violation of the Glass-Steagall Act.
Here’s an informative account of Sandy Weill’s creation of the first full-service superbank, Citigroup, and the repeal of the Glass-Steagall Act that stood in his way .
This is from a report by Frontline that discusses the end of Glass Steagal and interviews of former SEC Chairman Arthur Levitt, former Federal Reserve Board member Alan Blinder, New York State Attorney General Eliot Spitzer, financial historian Charles Geisst, the Precusor Group’s Scott Cleland, and Kenneth Guenther of the Independent Community Bankers of America.
Excerpt: Arthur Levitt, SEC chairman from 1993 to 2001:
“It was apparent to me that the protections of Glass-Steagall had already largely eroded. But Congress, at several times, nearly passed a bill to do away with Glass-Steagall. It was clear that it was a question not of whether but when Glass-Steagall would go. Millions of dollars were pouring in the campaign coffers of senators…
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