Take notice of this text of the upper area of the note:
“Why are we sending you a Notice of our Privacy Policy?
“Federal law permits banks, investment companies, and insurance companies to provide all their services under one organization. This same law requires State Farm to share our Notice of Privacy Policy in writing with you each year you are insured with us or maintain an account with us.”
Let me re-emphasize this point:
“Federal law permits banks, investment companies, and insurance companies to provide all their services under one organization.”
This law – the Glass-Steagall Act – since its inception in Great Depression era America in 1933, FORBADE the incestuous fiscal orgy under which this nation now suffers.
The Glass-Steagall Act was the subject of intense lobbying efforts by Banks, Insurance Companies and Stock Brokerage Houses to repeal the law, and especially intensified circa 1960’s, climaxing in the late 1990’s under a Republican-controlled House and Senate.
The 1999 repeal of the Glass-Steagall Act allowed commercial banks, investment banks, securities firms, and insurance companies to consolidate, or commingle, their business.
Previously, it prohibited any of those institutions (banks, insurance companies, and stock brokerage houses) from acting as any combination of an investment bank, a commercial bank, or insurance company.
The Gramm-Leach-Bliley Act, also known as the Financial Services Modernization Act of 1999, (Public Law 106-102, 113 Stat. 1338, enacted November 12, 1999), was signed into law by President Clinton.
WHY IS THIS IMPORTANT TO YOU and ME, AND HOW DOES THIS AFFECT YOU and ME?
The recent financial melt-down in this nation – now being called “The Great Recession” – is due in large part to the elimination of the Glass-Steagall Act, because the banks that made bad loans, the insurance companies that insured the real estate and commercial paper, and the stock brokerage houses that traded the stocks of both, and owned both, were greedy for more gain, and eventually began to invent complex mechanisms and artificial commercial paper which came to be known as “derivatives.”
In essence, those “derivatives” were based upon Credit Default Swaps – another complex and inherently evil type of financial thing/device – which was described by German Chancellor Angela Merkel, in March 2010 as “Credit-default swaps, where you insure your neighbor’s house just to destroy it and make money from it, that’s exactly what we have to curb. We must succeed at putting a stop to the speculators’ game with sovereign states.”
The types of investments that most people tend to be familiar with, such as stocks and bonds, involve betting that a company or government will do well. In stark contrast, a credit default swap (CDS) allows an investor to bet that a certain bond issuer will do poorly, or fail – not be able to meet its obligations. In financial markets, the CDS is sometimes thought of as a form of Read the rest of this entry »
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