Explain the forces that caused the savings and loan debacle in the latter half of the 1980s

What will be an ideal response?

Deposit insurance created a moral hazard problem in which savings institutions had an incentive to make riskier loans than they would have made in the absence of deposit insurance. In addition, because their deposits were federally insured, depositors of savings institutions had less incentive to monitor the risks incurred by the managers. As a result, the institutions extended large amounts of high-risk loans, many of which generated losses that resulted in failures by numerous institutions.