The increase in nominal interest rates during the 1970s led to an increase in the size of the traditional banking industry.

Question

Quizplus · Accepted Answer

The increase in nominal interest rates during the 1970s actually led to disintermediation, where depositors moved their funds from low-interest bank accounts to higher-yielding investments, such as money market funds, reducing the size of the traditional banking industry.

The Increase in Nominal Interest Rates During the 1970s Led