I've been wondering this for a long time, and have recently done some research on it but didn't find much info.
The Glass-Steagall act for anyone that doesn't know was made in the New Deal years to seperate Commercial Banks and investment Banks. One bank that was drastically changed by Glass-Steagall was JP Morgan, as Morgan Stanley was created by the Investment Bankers who couldn't work at JP anymore.
It was repealed in 1999, and some say that it has helped in the current crisis (Citigroup being the prime example)
So my question is:
The banks like JP Morgan who are now leaders in M&A and traditional Investment Banking, what were they doing in the 80's and 90's? Were they allowed to have Investment Banking operations, just not the prop trading and high leverage of the Goldmans and Lehman's? Did JP Morgan only start back up its investment bank after 1999?
The lack of knowledge has always bothered me. I fancy myself a amateur wall street historian, and would like to know.
Thanks very much for any info.
Did you really do research?
http://en.wikipedia.org/wiki/J.P.Morgan%26_Co. http://en.wikipedia.org/wiki/Chase_Manhattan_Bank
That took me 21 seconds because my internet connection is a bit slow atm.
booyah
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