Question

The U.S. banking revolution Which of the following statements are true of the savings and loan crisis of the 1980s and early 1990s? Check all that apply. Ultimately, taxpayers benefited from the federal bailout of the failed institutions. The savings and loan crisis was directly related to the Monetary Control Act of 1980. After the Monetary Control Act of 1980, interest rates on short-term deposits decreased. El During the crisis, savings and loan associations (S&Ls) sought more long-term home mortgage loans.

Answer 1

The savings and loan crisis of the 1980s and early 1990s had a significant impact on taxpayers and the financial industry. The federal bailout benefited the depositors, and the regulations and interest rate changes influenced the S&Ls' practices in the market.

Step-by-step explanation:

The savings and loan crisis of the 1980s and early 1990s had several notable characteristics:

1. Ultimately, taxpayers did benefit from the federal bailout of the failed institutions. The government paid out at least $150 billion to insured deposit accounts at the savings and loan institutions. This bailout was necessary to protect the depositors' funds.
2. The savings and loan crisis was indirectly related to the Monetary Control Act of 1980. Although the act did lead to some deregulation in the financial industry, the crisis was primarily caused by bad investments and risky loans made by the S&Ls.
3. After the Monetary Control Act of 1980, interest rates on short-term deposits decreased. This allowed the S&Ls to offer competitive interest rates to attract depositors.
4. During the crisis, savings and loan associations (S&Ls) sought more long-term home mortgage loans. This contributed to their downfall as the real estate market declined.