Enabled commerical and investment banking conglomeration

Eliminating Glass-Steagall, enabled commerical and investment banking conglomerates to emerge.

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The Global Financial Crisis
Long-term causes of the financial crisis?
Unintended consequences of earlier public policy choices
Investment banks incentivised to move into riskier activities
How were investment banks incentivised to increase risk?
Allowing mixing of commercial and investment banking in 1990s
Enabled commerical and investment banking conglomeration
Advantages seen in Bank of America acquisition of Merrill Lynch
Model proven in Europe
Risks increase while logic of conglomeration unfolds
Conglomeration enables diversification
Investment banks gain access to more stable source of funds
Allowed commercial banks to compete with investment banks
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