Caroline Fohlin of Emory University reviews “Taming the Street: The Old Guard, the New Deal, and FDR's Fight to Regulate American Capitalism” by Diana B. Henriques. The Econlit abstract of this book begins: “Explores Franklin Delano Roosevelt's development and enactment of the New Deal after the 1929 stock market crash and subsequent Great Depression, focusing on the establishment of the Securities and Exchange Commission (SEC).”

Close bank relationships are thought to ameliorate firms' liquidity constraints—a phenomenon frequently measured by liquidity sensitivity of investment. Using German firms during the formative years of universal banking (1903–1913), this paper shows that, even controlling for selection bias, investment is more sensitive to internal liquidity for bank‐networked firms than unattached firms. The firm exhibiting the greatest liquidity sensitivity, however, faced no apparent liquidity constraint. The findings yield two implications: they support recent research rejecting a linear relationship between liquidity sensitivity and financing constraints, and they suggest that relationship banking provides no consistent lessening of firms' liquidity sensitivity.