ABSTRACT
This chapter discusses how bank deregulation has affected the lending practices of both "traditional" and "fringe" banking. It shows that productivity has reached its highest levels since the 1960s, but tracing where these gains have gone is tricky. The chapter examines the rapidly expanding pool of credit provided by the financial services industry. Basic changes in this industry have allowed for the rapid expansion of credit of all kinds, miring the middle class in ever-expanding debt. The deregulation of the banking industry during the 1980s set the stage for the transformation of the consumer credit landscape. The number of credit card users and the levels of debt carried on credit cards have skyrocketed since the 1980s. Interest rates on car-title loans are usually much higher than rates on conventional loans and credit cards. Credit securitization refers to a complex process of packaging, underwriting, and selling loans and other receivables as securities.
