Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Geithner Says No Glass-Steagall Repeal Cause in Crisis

Don't Miss Out —
Follow us on:

April 26 (Bloomberg) -- U.S. Treasury Secretary Timothy F. Geithner said the repeal of Glass-Steagall, the Depression-era law separating deposit-taking institutions from investment banking, didn’t play “a material role in the causes of our financial crisis.”

“I know that view is not widely accepted in many places,” Geithner said in response to a question after a speech in San Francisco today. Geithner, 50, was president of the Federal Reserve Bank of New York during the 2008 financial crisis and became Treasury secretary the next year under President Barack Obama.

“A huge amount of risk built up outside our banking system, outside the safeguards and protections we put in place in the Great Depression,” Geithner said. “That risk and leverage grew up, built up, very substantially, and when the storm hit it put enormous pressure on a part of the system that provided about half the credit to the American economy. Nothing to do with Glass Steagall.”

Glass-Steagall was repealed in 1999.

To contact the reporter on this story: Ian Katz in Washington at ikatz2@bloomberg.net

To contact the editor responsible for this story: Chris Wellisz at cwellisz@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.