What are the crises of savings and loans?

savings and credit crisis, also known as the S&L crisis, is one of the largest financial scandals in the history of the United States. The crisis, which was in the 1970s and 80s. The 20th century, led to the insolvency of hundreds of savings and loans and resulted in new regulations to prevent such crises from leading to various factors in the 1970s in the future. Although the exact causes of savings and credit crisis are a question of some debate, the resulting financial disaster required more billions of US dollar assistance from the federal government and could be a factor in the economic recession, mainly at the beginning of the 90's and the US economic crisis. States. The industry has been carefully regulated and at the end of the 1960s, COULD does not offer investors considerable revenues that could invest money and investments in the stock market. As a result, the government has passed several laws leading to DeregulACI of this industry, often considered one of the main factors leading to savings and credit crisis.

with less regulations on the performance, savings and associations of loans could invest in businesses with a greater risk, but this could provide potentially much higher revenues. One of the causes of savings and credit crisis cited by many economists is the fact that companies and credit companies were federally insured at the same rate, regardless of the level of investment risk. This has led to more and more risky investments supported by taxpayers' money, allowing already fighting companies to fall deeper into the debt without consequences.

There are dozens of suggested causes of savings and credit crisis, especially on the effects of deregulation of annealostatics of effective supervision, stunning success of secondary rental companies that could offer better revenues and rates of loans than S&L, and collapse of housing marketsthroughout the United States in the 80's. Unfortunately, the crisis was hidden and complicated by regulatory advice that began to take more and more drastic measures to protect unsuccessful associations to avoid the appearance of the financial crisis.

In 1989, President George Herbert Walker Bush introduced a rescue plan called The Financial Institutions Reform, Recovery and Enforcement Act from 1989 (Firrea) as a result of the Revelation of the Inccess Increase in the S&L Industry. This plan removed the original regulatory board and replaced them with new ones, expanded the powers of the then successful secondary credit organizations and created an entity to try to solve almost 800 S&L associations, which now considered insolvent. According to some estimates, the resulting plan cost US taxpayers exceeding $ 120 billion USD (USD) from implementation.