Wall Streets dark day, place at the feet of the Republican Led Congress in 1999

Today Sept 15, 2008 the stock Market took a massive hit due to the recent turmoil of failing banks and investment firms from the fall out of the housing market. Lehman Brothers filed bankruptcy and Merrill Lynch was forced to sell to Bank of America, this all follows closely the federal government bailout of Fannie Mae and Freddie Mac. So who is responsible for the current problems? Well it has something to do in my opinion with congress back in 1999 while Bill Clinton was on his way out of office repealing an act called the “Glass-Steagall Act” The Glass-Steagall act was a measure enacted in response to all the failed banks during the Great Depression. Here is the definition from wikipedia.

The Glass-Steagall Act of 1933 established the Federal Deposit Insurance Corporation (FDIC) in the United States and included banking reforms, some of which were designed to control speculation.[citation needed] Some provisions such as Regulation Q that allowed the Federal Reserve to regulate interest rates in savings accounts were repealed by the Depository Institutions Deregulation and Monetary Control Act of 1980. Other provisions which prohibit a bank holding company from owning other financial companies were repealed in 1999 by the Gramm-Leach-Bliley Act.[1]

In 1999 the Gramm-Leach-Billey ( R-Phill Gramm, R-James Leach) Act effectively dismantled the Glass-Steagall Act which led to rampant speculation and shaky investments. Waves of Sub Prime loans packaged and sold off as securities are coming home to roost and it is only going to get worse with the majority of sub prime arms and interest only loans due to reset all the way to the summer of ’09.

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