The State of Banking: What We Can Learn From History

Episode #51

The US economy has repeatedly defied predictions of a recession in recent years, but the tumultuous aftermath of the Silicon Valley Bank collapse early this month has rekindled recession fears.


The collapse, which took down several other banks, is in part a rerun of a familiar story, one that highlights the importance of having adequate financial regulations.


In today’s episode, we’ll take a trip down memory lane to the different financial panics and crises in US history to better understand how banking works, the state of the banking industry and the economy, and what financial history can tell us about what may happen next.

Show Highlights

  • [03:09] Fractional vs. full reserve banking
  • [06:26] Three types of banks
  • [08:36] Financial panics before the Great Depression
  • [13:08] Why the 1957 financial panic was unique
  • [17:06] How the FDIC and the Glass-Steagall Act impacted banking
  • [22:03] The Garn-St Germain Depository Institutions Act of 1982
  • [27:39] How the Clinton administration overhauled the Glass-Steagall Act
  • [31:00] The aftermath of the repeal of Glass-Steagall
  • [35:55] The Dodd-Frank and what it does
  • [38:13] The current state of US banking after the recent Silicon Valley Bank collapse


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