Banking's Structural Changes
Deregulation, Mergers, Hybrid Institutions
Major structural changes are taking place in the U.S. banking system, as evidenced by a wave of mergers among financial and quasi-financial institutions, a crisis in the savings and loan industry, the continuing spread of computerized teller and credit card services, and the meteoric growth of money market funds. For decades, the foundations of America's highly compartmentalized banking system have been shaken, as consumers and businesses increasingly have bypassed traditional financial institutions to obtain credit directly from retailers, insurance companies or brokerage houses. In recent years, the partitions in the system have begun to come down, as the various sectors of banking have become much more competitive with one another in going after deposits and the loan business.
Record-high inflation ...