It’s going to take time for any bailout of the financial markets to have an effect, Nomi Prins, former investment banker and author of “Other People’s Money: The Corporate Mugging of America,” said today on National Public Radio.
That’s not good news. We’d all like this financial crisis to be over and behind us so we could move to a brighter financial future.
In recent news reports, the lack of the willingness of the Bush administration to regulate the banking industry has been covered.
Prins also talks about the Glass-Steagall Act of 1933, which separated riskier, speculative investment banks from the more consumer-oriented commercial banks. And, it provided safeguards to the entire financial system.
Glass-Steagall was repealed in 1999, in a bill signed into law by President Bill Clinton. The new law was called the Gramm-Leach-Bliley Financial Services Modernization Act. U.S. Senator Phil Graham, R-Texas, introduced the bill in the Senate. The banking industry had been seeking the repeal of Glass-Steagall since at the 1980s.
Does Prins think the proposed bailout, with provisions similar to the savings and loan bailout, will solve the financial crisis?
Not really, she said in an article on the Mother Jones Web site, “Will the Government Bailout Work?”
Prins also said in the article that Washington is using the regulations that it didn't destroy to attempt to deal with the financial crisis. "It would be much better if they were discussing how to resurrect the ones they did."
Check out Prins’ article for further details.