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Undue Influence: How the Wall Street Elite Puts the Financial System at Risk

ISBN: 978-0-471-65663-0
330 pages
November 2004
Undue Influence: How the Wall Street Elite Puts the Financial System at Risk (0471656631) cover image


A critical look at over 80 years of conflict, collusion, and corruption between financiers and politicians
Undue Influence paints a vivid portrait of the dealings between "the few", in this case members of Congress, the banking community, and the Fed, and sheds light on how radical new deregulatory measures could be introduced by unelected officials and then foisted upon Congress in the name of progress. In the process, the background of the new financial elite is examined-because they are markedly different than their predecessors of the 1920s and 1930s. Undue Influence also brings readers up to speed on other important issues, including how the financial elite has been able to perpetuate itself, how the markets lend themselves to these special interest groups, and how it is possible that after 80 years of financial regulation and regulatory bodies the same problems of financial malfeasance and fraud still plague the markets.
Charles R. Geisst (Oradell, NJ) is the author of 15 books, including Wheels of Fortune (0-471-47973-X), Deals of the Century (0-471-26397-4) and the bestsellers Wall Street: A History and 100 Years of Wall Street. Geisst has taught both political science and finance, worked in banking and finance on Wall Street and in London, as well as consulted. His articles have been published in the International Herald Tribune, Neue Zurcher Zeitung, Newsday, Wall Street Journal, and Euromoney.
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Table of Contents

Introduction 1

Chapter One Distrust of Wall Street in the 1920s 11

Chapter Two The Assault on Wall Street 59

Chapter Three Continuing the Assault 109

Chapter Four Three Decades of Slow Change 149

Chapter Five The Reagan Years 189

Chapter Six Deregulation in the 1990s 239

Postscript Is Deregulation Working? 287

Bibliography 291

Notes 295

Index 305

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Author Information

CHARLES R. GEISST is the author of fifteen other books, including Wheels of Fortune: The History of Speculation from Scandal to Respectability (Wiley), Deals of the Century: Wall Street, Mergers, and the Making of Modern America (Wiley), and the bestsellers Wall Street: A History and 100 Years of Wall Street. Previously, he worked as a capital markets analyst and investment banker at several investment banks in London, and has also taught both political science and finance. He has published trade articles in magazines and newspapers such as the Wall Street Journal, International Herald Tribune, Neue Zurcher Zeitung, Newsday, and Euromoney.
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"…incisive explanation of various consiracy theories" (Gulf Business, May 2005)

The Glass-Steagall Act, separating commercial banks from investment banks, was passed in 1933 to prevent banks from risking depositors’ funds on the still-shaky stock market. It was repealed in 1999, when gambling other people’s money on the stock market was considered the height of financial probity. In this engaging history of Glass-Steagall, Geisst (Wall Street: A History) surveys the 70 years leading to this ideological sea change, as the widespread Depression-era populist suspicion of Wall Street subsided, to be replaced with the pro-business dogma of the Reagan era and the New Economy bubble. Formal repeal, Geisst shows, was preceded by decades during which big commercial banks, hungry for a slice of the lucrative investment banking business, increasingly flouted Glass-Steagall restrictions with the connivance of ideologically sympathetic Federal Reserve regulators. The vast sums banks have spent on lobbying and campaign contributions, and the cushy Wall Street jobs awaiting government officials who switch sides, make Geisst wonder whether "the gamekeepers and the poachers had all joined the same club." Geisst provides a lucid guide to the financial issues involved and a colorful account of decades-long political debates and legislative wranglings, while raising troubling questions about the direction of public policy. (Dec.) (Publishers Weekly, November 15, 2004)

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