It’s time to put an end to the financialization insanity that’s hurting average people, destroying the American dream, and turning our economy into one big giant casino. One of the most startling trends to come out of the wreckage of the 2007-2008 financial crisis is the explosion of Wall Street firms buying up and renting out property all across the country.

The housing glut and foreclosure crisis that was, for most Americans, the symbol of the devastation caused by the worst economic downturn of our lifetimes, was, for Wall Street a wonderful business opportunity. A study from the Center for American Progress estimates that in the five plus years since the crash, “institutional investors [i.e. big banks and hedge funds] have... bought approximately 200,000 single-family homes at bargain prices and converted them into rental homes.”

Amazingly, the New York City-based hedge fund The Blackstone Group has focused so much of its resources on the real estate business that is now the single largest landlord in the entire country.

Now, I’ve known many people over the years who’ve decided to become landlords. It’s a smart financial decision, the kind that middle class people used to do all the time to help them boost their income. Renting out your first or second home is great way to earn some extra money, help pay the mortgage, or even make a living once you retire and no longer take home a paycheck.

But making a few extra bucks isn’t why big banks and hedge funds are buying up thousands of houses every year. The real reason why they’re so enthusiastic about throwing people out of their homes and flipping those houses into rental properties is that they want to repackage those properties and their rent payments into fancy financial products - remember derivatives? - that they can then sell to investors.

In other words, being a landlord is just another way for Blackstone Group and companies like it to make money with money. They don't produce anything at all, they don't add anything to our economy, they don't help any middle-class families, they just make money with money. And given that that's all they do, it shouldn’t be much of a surprise that, they’re really, really bad at being landlords.

The activist coalition Housing For All recently surveyed hundreds of tenants living in Blackstone-owned properties in the Los Angeles area and what they found was startling. Nearly half of the tenants surveyed said they had problems with their plumbing. Almost 40 percent said they had roach or insect infestation. Another 22 percent said they had issues with rodents or termites. A similar number of surveyed tenants said that had problems with heating, mold, and roof leaks.

All in all, not a pretty picture, and a picture made worse by the fact that only one in 10 Blackstone tenants said they had ever met a representative of their landlord in person. While Blackstone gets rich repackaging homes into fancy financial products, the people who actually live in those homes suffer.

There have always been slumlords, but what we’re seeing right now with Wall Street firms like Blackstone buying up home after home, renting them out, and then using rental payments as the basis for derivative securities is something new and totally dangerous.

The financial products Wall Street is creating with its new rental empire are basically a re-hashed version of the mortgage-backed securities that crashed our economy five years ago. There’s a new bubble in the works, and if we’re not careful, we could see another financial crisis sooner than you might think.

This is a perfect example of why we need to totally rethink the financialization of our economy. Banks and financial institutions, especially regular, old-fashioned commercial banks, do have an important role to play in our economy. They facilitate commerce and help everyday people save and use their money through things like checking and savings accounts. In our economy, banks are supposed to provide that function.

There’s even a place for Wall Street in our economy. When regulated and controlled, investment banking can provide opportunities for asset and investment growth that wouldn’t otherwise exist. But there’s a huge difference between finance being just one part of our multifaceted economy and making it the dominant sector, as it is today.

There’s also a difference between allowing Wall Street to play a small role in the banking industry and letting it control the industry, as Congress and President Bill Clinton allowed to happen by deregulating the big banks in 1999 and 2000. We now live in a financialized country, and every part of our economy, whether it’s the real estate market, the commodities market, or the manufacturing industry, is in thrall to the big banks and hedge funds on Wall Street.

This is insane -- it’s a recipe for disaster.

That’s why it’s time to go back to what worked for decades before Wall Street took control of the banking industry and the economy. It’s time to make banking boring again by putting a firewall between good old-fashioned checking-account "commercial banks" and the "investment bank" gambling houses on Wall Street. Not only will this bring sanity to the banking industry, it'll also bring sanity to our entire economy as well, by protecting us from whatever crazy scheme Wall Street comes up with next.

Let the investment banks gamble all they want. Just keep the rest of us, and our houses, out of it. Bring back Glass-Steagal.