High Rollers: Inside the Savings and Loan Debacle

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Greenwood Publishing Group, Jan 1, 1991 - Business & Economics - 321 pages
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Lowy avoids the easy answers, like blaming it on fraud and greed, and explains how something of this magnitude could occur under the noses of those who should have protected the taxpayer.

"Paul M. Horvitz, University of Houston"

Market forces, not scoundrels, destroyed the savings and loan business. So says Martin Lowy in what is truly an inside look at the savings and loan crisis. Drawing upon his experience as a practicing attorney, bank officer, and savings and loan director, Lowy provides an expert account of the problems that have overwhelmed the nation's savings institutions and their government regulators.

"High Rollers" is the first book on the S&L crisis that provides an analytical groundwork for technical and nontechnical readers--so that both can comprehend what happened. Lowy's clear, readable style allows him to quickly describe the origins of the problems in new market forces and new technologies, and how the problems grew out of control as a result of regulatory mistakes and congressional inaction. Even his discussions of real estate lending practices and accounting issues are, in the words of Professor Horvitz, both clear to the novice and instructive to the professional.

 

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Contents

Preface be Introduction
1
Chronology
7
How It Happened
11
Fixed Rates in a Volatile World
13
How Insured SLs Fail
27
Dick Pratt Figures Out How to Run a Bankrupt Federal Insurance Fund
35
The False Spring of 198 3
58
Real Estate Lending 101
64
Politics as UsualEverybody Fiddles While
176
Danny Wall and the 1988 Deals
198
FIRREA
222
What Caused How Much of the Losses?
229
High Rollers
238
Evaluating Deregulation
245
The Importance of Counting
254
Avoid Complexity That No One Can Understand
263

Permissive Loan Fee AccountingThe Linchpin
77
Mammon Against the God of Home Ownership
86
Ed Gray Tries to Cope and the World Goes Galloping By
100
The Big Texas Disaster
126
The Laws Trash the Trash
136
Silverado Lincoln and CenTrust
140
The Junk Bond Connection
155
Fraud and Misconduct 101
160
Regulation Cant Tame Technology or Market Forces
271
The Future of Thrift Institutions
283
Dynamics of a Broke SL
291
Notes
301
Selected Bibliography
311
Index
317
Copyright

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About the author (1991)

MARTIN LOWY is a banker and lawyer with 25 years of experience in thrift institution law, management, and regulation. As a lawyer he has represented thrift institutions, bank trade associations, and accounting firms, as well as the New York State Superintendent of Banks and the Federal Deposit Insurance Corporation in failing bank situations. He served as Vice Chairman of Dollar Dry Dock Bank from 1986 to 1989, and currently is Counsel to the New York law firm of Rosenman & Colin.

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