A Crisis In The Making

The Savings and Loan Crisis: A Looming Financial Disaster

A Crisis in the Making

The Savings and Loan (S&L) crisis of the 1980s and 1990s was a financial disaster that slowly unfolded over many years. At the heart of this crisis was the deregulation of the S&L industry, which allowed savings and loans to take on riskier investments. This, coupled with a surge in real estate lending, led to a wave of bad loans and ultimately the failure of hundreds of S&Ls.

The Fallout

The failure of S&Ls had a ripple effect on the entire financial system. The government was forced to bail out many of these institutions, which resulted in a massive increase in the national debt. The crisis also led to a loss of confidence in the banking system, which made it more difficult for businesses and individuals to obtain loans.