Glass-Steagall Delivered 50 Years of Stability But Constrained US Growth
Alan Waxman · What 100 Years of American Finance Tells Us About Today · Invest Like The Best · Apr 8, 2026 · at 5:13
Alan Waxman, CEO of Sixth Street, reviews the trade-offs of the 1933–1999 US regulatory regime separating commercial and investment banking.
0:00 / 0:30exact quote · 30.6s
▶ Watch the full episode on YouTube → 720p mp4 · rendered on demand · StarZero watermark
“When you look at post-World War II with this separation of commercial banks and investment banks, you basically have really after post-World War II, Kind of, 50 years, a pretty stable system other than the SNL crisis in the 19 eighties, which was a big event. It was a pretty good system, but the system wasn't optimized for economic growth. Because you only had really a pretty conservative with a lot of guardrails, commercial bank providing finance.”
quote is from the automated transcript, cleaned for reading: filler sounds and stutters are removed, nothing is rephrased. names can be misheard (the analysis reads context, assessments check outside sources). how →
More from Alan Waxman
The 1999 Repeal of Glass-Steagall Contributed to the 2008 Financial Crisis
“I think There was definitely some attribution to it. I don't think that was clearly not the only reason, but my view it's some combination, but ultimately it had to do with the system and the set of incentives.”
Asset-Liability Mismatches, Not Bad Credit, Drive Financial Crises
“All crises is generally a cause from not credit issues or others. There's, they might start in other issues, but it's mismatched assets and liability.”
Industrialized Capital Fundraising Forces Asset Managers Into Factory-Model Deployment
“The two parts to it are, first part is the industrialization of the fundraising process, right?
It's a liability gathering.
So literally raising as much capital as you possibly can, literally as fast as you can.
So that's sort of the industrialization of the l…”
Credit Investors Must Reject Collateral Stripping for a Mere 10% Return
“If you have capped upside and you're earning a 10% return and all the collateral that your 10% is based on can literally be basically taken out of your collateral package overnight. Or for that 10% return, you can be levered up because let's say there's an AI …”
Waxman: 'Semi-Liquid' Assets Do Not Exist; Investments Are Liquid or Illiquid
“There's no semi-liquid, ok? There's no such thing as semi-liquid. Like, anyone that's an investor that's been through a bunch of cycles, there's liquid, and then there's illiquid”
Private BDC Liquidity Bottlenecks Do Not Pose a Systemic Financial Risk
“I don't think this is a systemic issue yet for two reasons. One, we're only five years into this, so it's early. And the second, second thing, at least for now, there's a pretty strong economic backdrop. There's definitely risk to it. So I don't think this is …”