Savings and Loan Crisis

The following is a detailed summary of the major causes for losses that hurt the savings and loan business in the 1980s: Lack of net worth for many institutions as they entered the 1980s, and a wholly inadequate net worth regulation. Decline in the effectiveness of Regulation Q in preserving the spread between the cost of money and the rate of return on assets, basically stemming from inflation and the accompanying increase in market interest rates. Absence of an

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