Glass-Steagal Act

(redirected from Glass Steagall Act of 1933)

Glass-Steagal Act

Legislation in the United States, enacted in 1933, intended to restore confidence in the banking system. Among its most important provisions was the creation the FDIC, which provided insurance on bank deposits up to a certain amount. The act also prohibited bank holding companies from owning brokerages or certain securities. This provision was designed to prevent banks from engaging in most investment activities and thereby to reduce the risk they carried. Most of the Glass-Steagal Act was repealed by the Gramm-Leach-Bliley Act in 1999. It is formally called the Banking Act of 1933.
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Ever since the 1999 repeal of the Glass Steagall Act of 1933, which separated the bank's consumer operations from those of investment banks, banks have lost sight of the protective and trustworthy institutions they once represented," states Dr.