Request

[voideng]

Please read these two articles in the below order and comment.

http://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929

http://www.slate.com/id/2172342/fr/rss/

Comments

[carrot_khan]

We're screwed?

[voideng]

Probably.

[sinthrex]

Not certain what you are looking for as far as comments, but if you're basically asking if I think we're in for another 1929, I don't.

If looking for a possible model for what might happen in the US in a present-day stock market crash, more useful lessons and pointers can probably be developed from Black Monday and the Asian implosion of 1997 and what has come out of that. Those examples do need to be modified to account for the differences, though.

[voideng]

Any new thoughts?

[sinthrex]

Yes. What impact (if any) do you think the removal of Glass-Stegall had?

And assuming that Congress doesn't get around to passing something (not necessarily this, it had some issues) what political impact do you think it will have?

[voideng]

I do not think the removal of the Glass-Stegall Act had any effect on this, the investment banks wanted nothing to do with the commercial banking system, and until a couple of weeks ago, the division effectively remained in-place until last week.

The material I have read on the post '46 debates on the Glass-Stegall Act indicate to me that it made the finance sector significantly more fragile, and if it was never put into place, or removed before '74 or even '82, we wouldn't be having this problem.

We are at a major breaking point, we can either start drifting back towards free markets or take the final steps into socialism. There is a lot of pain either way, free markets means intense short term pain, socialism means prolonged pain.

Ultimately, the effects in November, will depend entirely on the media. If Pelosi's speech before the vote is distributed, then it is a major loss to the Democrats, else the status quo will be maintained.

[voideng]

http://rawstory.com/news/2007/Across_country_red_flags_could_signal_0817.html