ou and a friend are discussing the savings and loan crisis. She states that '' the whole mess started in the early 1980s. When short-term rates skyrocketed, S&Ls got killed their spread income went from positive to negative. They were borrowing short and lending long'' a. What does she mean by '' borrowing short and lending long''? b. Are higher or lower interest rates beneficial to an institution that borrows short and lends long?

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