On November 12, 1999, President Clinton signed into law the Gramm-Leach-Bliley Act

This act effectively repealed the Glass-Steagall Act.

The Glass-Steagall Act was enacted during the great depression to separate the activities of banks and securities firms. One of the immediate impacts of the repeal will be that certain advisory activities of the banks will be regulated by the Investment Advisers Act of 1940. The Gramm-Leach-Bliley Act directs the SEC to enact rules requiring units of banks that engage in the investment advisory business to register with the SEC.

Repealing the provisions of Glass-Steagall was equivalent to allowing Mr. Ponzi of "Ponzi scheme" fame to become a licensed financial advisor.

Before Glass-Steagall, banks encouraged their depositors to invest in stocks, that they also owned, which would drive the price up. Like the Enron scam, throwing money at a stock will boost its price according to the "law" of supply and demand. The stock price follows the perceived profitability of a company, not its actual profitability.
Get a lot of people to buy a particular stock, say a stock which is owned by a lot of bank executives, and that stock price is going to draw more buyers, which will boost its price even more.

I would guess that the subprime mortgage fiasco would not have occurred if Glass-Steagall had been in force as the mortgage companies would not have been able to sell so many risky, unsecured mortgages, if the banks and the securities firms had been prevented from working together.

Bill Clinton did a lot of damage to this country supporting repeal of Glass-Steagall, pushing NAFTA through Congress, pushing through so-called welfare reform, supporting the architect of corporatization of government and the looting of the middle class, Alan Greenspan, and other policies that have brought us to the sorry state of affairs the country is in now. Remember this when you hear Hillary Clinton talk about her "experience" providing her with the knowledge to be an agent for "change".

I know exactly what kind of "experience" the Clinton's bring to the table, and that is why I am not voting for her in the primaries

... (and, oh yes, people, her mismanagement of the healthcare issue was a significant contributing factor to that loss), Bill also lost the numbers necessary to turn back the PSLRA veto override.

PSLRA = http://en.wikipedia.org/wiki/PSLRA">Private Securities Litigation Reform Act, an Orwellian euphemism for "corporations have greater rights when being sued than people do."

The http://en.wikipedia.org/wiki/PSLRA#Legislative_History">legislative history of which Dems turned on this one may surprise you.

Et tu, Kennedy and Braun? Oh, wait: your donor lists and cozy ties with Boston and Chicago financial services firms tell the tale. Nevermind.

Notably, Bush's SEC Chair pick, Chris Cox, was a principal author and floor manager.

Many of the corporate scandals we have seen are the result of this piece of legislation, which makes it extremely difficult for responsible owners and shareholder activists to obtain discovery to prove malfeasance, breach of fiduciary duties, etc.

And the corporate defense bars in such places as Boston and Houston laughed all the way to the newly-deregulated banks mentioned in the OP.

- Dave