The Glass-Steagal Act of 1933

    One of Congress's key Acts during the Great Depression, during nationwide commercial bank failure, was the Glass-Steagal Act in 1933. The contents of this act separated investment and commercial banking opportunities, as, at the time, commercial bank investment in stock market investment was considered the key factor that led to America's financial crash.

   The true reason for the passing of this act was that commercial banks were essentially too speculative in their investing of assets, as well as the purchase of new issues for public resale. This created greediness in banks, causing them to take huge risks, which resulted in the extreme, unsound loans that really led to the Great Depression.

   Lastly, the main effect of the Glass-Steagal Act was, overall, a profound barrier between commercial and investment bank opportunities. This specifically targeted financial giants like JP Morgan and Company, making the Act seem so extreme that one of the main creators of the Act, Senator Glass, moved to repeal the Glass-Steagal Act shortly after it passed.

Sources:

http://www.investopedia.com/articles/03/071603.asp