Our firm, David B. Norton Inc., is often asked how we compare today’s real estate market recession and banking institution losses to the 1980’s S&L crisis. In the 80’s, banking regulators were going into insolvent financial institutions to understand what they missed from last year’s exam. Was it the ever optimistic developers? Was it the banking loan originators reaching for individual production goals? Was it mortgage brokers reaching for a record commission year? Could it be MAI (“made as instructed”) appraisals that only reflected short term market conditions? Or, was it “Reaganomics” supply side control of the monetary system which caused interest rates to spike, 20% plus prime rate, and brought the residential real estate market to a halt coupled with the oversupply of commercial estate space that brought down the S&L industry?