The subprime lending fiasco that Springsteen wrote about had been the result of deregulation. About a decade earlier, financial institutions lobbied Congress to repeal what remained of the Glass-Steagall Act, Depression-era legislation that prevented commercial banks from making risky investments with depositors’ money. Once Congress cut the brake line, big banks began finding increasingly creative ways to juice their profits. Some started bundling good mortgages with risky ones and selling them as AAA mortgage-backed bonds to pension funds, hedge funds, and mutual funds, the main investment
...more
