12 Hoosier Banker July 2016 HOOSIER BANKER HERITAGE: 1970-1979 A new economic term was coined in the 1970s: stagflation. Defined as stagnant business activity during a period of high inflation and unemployment, stagflation ‒ once thought impossible ‒ became a harsh reality when outdated U.S. monetary policy collided with oil crises, war expenses and costly social initiatives. Remediation efforts through wage and price controls and increased government spending backfired; by the dawn of the next decade, interest rates were soaring above 14 percent. Other pulse points of the ’70s were the burgeoning conservation movement, kick-started by the first Earth Day held in 1970; growth of the women’s movement, with Indiana as 1916 - 2016 YEARS the final state to ratify the ultimately failed Equal Rights Amendment; a blistering antiwar movement, punctuated by the Kent State shootings; withdrawal of U.S. troops from southeast Asia; the Watergate scandal and ensuing presidential resignation; and the Iran hostage crisis. Another milestone was the nation’s bicentennial celebration on July 4, 1976. On the banking front, multiple developments took place: 1970 - The Bank Secrecy Act passed; - Freddie Mac was established. 1971 - The Fair Credit Reporting Act passed; - The Farm Credit Act grew the powers of the Farm Credit System; - The gold standard for U.S. currency ended. 1973 - In-store bank branches opened; - NOW accounts became available. 1974 - The Basel Committee on Banking Supervision convened; - The Equal Credit Opportunity Act passed; - The Real Estate Settlement Procedures Act passed. 1976 - The Tax Reform Act of 1976 ushered in IRAs. 1977 - The Community Reinvestment Act passed. 1978 - The Electronic Fund Transfer Act passed; - The Uniform Interagency Bank Rating System (CAMEL) was adopted. 1979 - The Federal Financial Institutions Examination Council was established. Also in 1979, Paul A. Volcker was appointed chairman of the Federal Reserve Board. At an October news conference, warning that “some difficult adjustments may lie ahead,” he announced plans for a restrictive monetary policy. Though initially the predicted economic difficulties materialized, by early the next decade the revised policy, coupled with changes in presidential administration, would make the ’70s stagnation a faded memory. 1970 The 1970 IBA Annual Convention featured an Hawaiian theme. 1971 Donna Cole and C.Warren Lundy of First National Bank of Vevay reviewed Cole’s sketches for the bank’s new calendar. 1972 The Indiana Bankers Association celebrated 75 years of service in 1972.The Association was founded in 1897, and Hoosier Banker began circulation in 1916.
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