Glass-Steagall Fever after Chase

Glass-Steagall fever is catching from Massachusetts all over the United States. And it is catching in the wake of the $2 billion financial derivative loss of JP Morgan Chase.



Monday's endorsement of Glass-Steagall by Massachusetts U.S. Senate Democrat candidate Elizabeth Warren, has met with huge media coverage, and her Glass-Steagall petition request exceeded its goal of 50,000 signatures, in less than 24 hours!



The petition was posted yesterday at BoldProgressives.org, and sent to 900,000 subscribers, with an objective of getting 50,000 signatures soon. However, there were 52,000 as of this morning, and still coming in strong.



...WASHINGTON POST. There is an interview of Warren by Ezra Klein posted this morning, in which she speaks of Glass-Steagall, in response to Klein's palaver about the "complexity" of the Volcker Rule:



Warren: That's the strongest argument for a modern Glass-Steagall. Glass-Steagall said in effect that hedge funds should be separated from commercial banking. If a big institution wants to go out and play in the market, that's fine. But it doesn't get the backup of the federal government. If it's too complicated to implement the Volcker rule, do you say we give up and let the largest financial institutions do what they want? Or do you say maybe that's the reason we need a modern Glass-Steagall?



Klein: Do you support a modernized Glass-Steagall law?



Warren: Yeah! I've talked with Sen. Maria Cantwell from Washington State. She's been working on that, and I think the debate should be on the table."



BOSTON GLOBE Wide coverage is given to Warren's move for Glass-Steagall, and also to her call for Jamie Dimon to step down.



DOW JONES MARKET WATCH. David Weidner, the Wall Street reporter for MarketWatch, writes an opinion piece, saying, "So, rather than slap more ineffective and easily gamed rules into the system, let's just divide the system. We the people will keep our traditional banking — the monetary and economic side of the equation. We'll let casino capitalism run wild on the other side. Let's bring back Glass-Steagall..."



PITTSBURGH TRIBUNE REVIEW. An editorial in today's Pittsburgh Tribune-Review, owned by Richard Mellon Scaife of the Mellon banking family, says "the better solution is to return to a very commonsense past regulation — Glass-Steagall... [which] served this nation quite well for decades until its provisions began to be watered down in the 1960s and then eliminated in 1999..."



REUTERS. A Reuters editorial, by James Saft, says, "The Volcker Rule won't be effective; it is impossible to distinguish hedges from speculation and either can blow up banks. The better alternative is to end the policy of too big to fail, preferably while at the same time forcing all banks out of the business of market speculation through a revival of the kind of Glass-Steagall-like policy which encouraged a small and useful financial sector for decades, forcing those that want government insurance to act like utilities, taking deposits, processing payments and making simple loans."



The fever is catching, so time to dump Obama.