Posted by Orin Kerr:
"It's A Wonderful Life" and the Financial Services Industry:
http://volokh.com/archives/archive_2007_12_16-2007_12_22.shtml#1198360528
Over at [1]Money Law, Marie Reilly has an interesting post on the
movie [2]"It's A Wonderful Life" (click on link to view) and the
history of the financial services industry. An excerpt:
At the beginning of the 19th century, there was no banking as we
know it. Rich people needed safekeeping services to store gold or
other forms of wealth, and banks provided secure vaults. The first
depositary savings bank is thought to be the Philadelphia Savings
Fund Society, established in December of 1816. It launched an
industry that profoundly changed the American economy.
Savings and loans emerged as small businesses that accepted cash
deposits from customers and made loans to borrowers in the
community. During the nineteenth century, as urbanization and wage
income grew, savings and loans encouraged wage earners to save.
They replaced extended family as a source of capital. And all in
the nick of time to finance the rapidly growing consumer sector. A
wage earner needed finance to acquire the "American Dream"
consisting of big ticket items like a home and a car. The
connection between savings and loans and the emerging consumer
middle class was more than skin deep. As a regulatory matter,
savings and loans were "of the people" in a way that banks were
not. Depositors controlled the investment strategy deployed by
savings and loan management. In contrast, equity investors, usually
with no connection to the deposit community (e.g., Mr. Potter),
controlled the management of banks.
References
1. http://money-law.blogspot.com/2007/12/its-wonderful-life.html
2. http://video.google.com/videoplay?docid=-4867975537967299162
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