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The ability of financial institutions to speculate with taxpayer-guaranteed funds is a major cause of the crisis and it must be addressed, along with the other causes. If we don't reinstate Glass-Steagall, then we need to enact the Volcker Rule, a similar measure that was originally part of the Dodd-Frank legislation. Both Glass-Steagall and the Volcker Rule have advantages and disadvantages. The choice between the two involves both technical and political considerations. Either way, a policy solution is needed to stop financial firms from speculating with federally insured deposits. We won't have a stable financial system until we do.
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