The Savings and Loans Crisis

Paper Summary:

The paper discusses the causes of the current savings and loans crisis and offers potential solutions. The paper notes that inflation, deregulation and financial mismanagement are the major causes of the current situation and discusses these in detail. In addition the paper comments that the Federal government has proposed several solutions, including assistance for homeowners and lenders.

Outline:
Introduction
Causes of the Crisis
Inflation
Deregulation
Financial Mismanagement
Solutions
Conclusion

From the Paper:

"Inflation affects the Savings and Loans industry because it influences investment decisions and in some cases increases the need for people to borrow. This increased need to borrow may come in the form of increased credit card use, the taking out of loans including home equity loans and lines of credit. Inflation is a particular problem in the current economic environment because not only are wages not keeping up with the costs of basic goods and necessities but many are loosing their jobs altogether. This means that people are defaulting on payments to creditors."

Sample of Sources Used:

• Jumbo Loans Spell Relief; Analysts See Economic Fix. (2008, January 29). The Washington Times, p. A01.
• Kuttner, R. (2007, October). The Bubble Economy: The Financial Meltdown Is the Logical Consequence of Deregulation. Will We Reverse Field in Time to Prevent Another 1929?. The American Prospect, 18, 20+.
• Peterson, J. R. (2005). Designer Mortgages: The Boom in Nontraditional Mortgage Loans May Be a Double-Edged Sword. So Far, Most Banks Have Moved Cautiously. ABA Banking Journal, 97(10), 30+.
• "What is the real definition of inflation?". Retrieved May 8, 2007 from; http://www.inflationdata.com/Inflation/Articles/Definitions.asp
• Subprime lending. Retrieved May 8, 2007 from; http://www.hud.gov/offices/fheo/lending/subprime.cfm

More papers on The Savings and Loans Crisis:

• Essay # 18994 : "The Savings and Loan Crisis"
• Essay # 18266 : "Savings and Loan Crisis"
• Essay # 18493 : "Savings and Loan Crisis"

APA Citation:

MLA Citation: