For Glass-Steagall in the 1930s, read the Volcker Rule for a new decade. Instead of the crude separation of commercial and investment banking, we will now see an equally crude split of the banking business from proprietary trading, hedge funds and private equity.

Some salient points on Glass-Steagall are often missed. First, for decades, it worked. The US financial reforms of the 1930s helped to deliver decades of stable economic growth and reasonably stable growth in equity markets.

Second, its very crudeness may have been the key to its success. A clear-cut if arbitrary division will be obeyed. Subtle tinkering with incentives can lead to “gaming the system”, as seen most blatantly in the Basel rules that inadvertently encouraged banks to charge into subprime mortgages.