THE RUGGED INDIVIDUALIST                     

Glass- Steagall

In 1933, in the wake of the 1929 stock market crash and during a nationwide commercial bank failure and the Great Depression, two members of Congress put their names on what is known today as the glass - Steagall act (GSA). This act separated investment and commercial banking activities. At the time, "improper banking activity", or what was considered overzealous commercial bank involvement in stock market investment, was deemed the main culprit of the financial crash. According to that reasoning, commercial banks took on too much risk with depositors' money.

The repeal of this law is one of the major contributors to the great recession. Because commercial bank money poured into Wall Street. Mixing banks that service individuals and small businesses within the investment banks of Wall Street.