High inflation rates in the 1970s were helpful to S&Ls because the price of the fees that S&Ls charged increased faster than their costs, so that the profitability of S&Ls increased.

Question

Quizplus · Accepted Answer

High inflation rates in the 1970s were detrimental to Savings and Loan Associations (S&Ls) because their long-term, fixed-rate mortgage assets lost value while their short-term liabilities increased in cost, reducing profitability.

High Inflation Rates in the 1970s Were Helpful to S&Ls