Re: capitalist religion (was: NANO: _Forbes_ cover story)

From: Mike Lorrey (
Date: Fri Jul 20 2001 - 10:38:26 MDT

> Daniel Ust wrote:
> <In the US, in the late 1970s and early 1980s, the Savings & Loans were
> "deregulated." Specifically, restrictions were loosened on what they could
> invest in. However, the FSLIC -- deposit insurance for the Savings &
> Loans -- was NOT disbanded. ... it's deposit insurance that is to
> blame and the particular deregulatory path taken with regards to the Savings
> and Loans enhanced the problems with deposit insurance.>

The S&L 'crisis' was not a 'proof' that deregulation was bad. The crisis
was an example of political appointees specifically engineering a
financial meltdown to change the ownership of the Presidency. It only
took one act: doubling the reserve rate S&Ls were required to retain in
cash. This forced S&Ls to call in massive numbers of loans, leading to
massive numbers of loan defaults, and the crash of the S&L industry.

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