What happened
Savings and loans (thrifts) existed to take savers' deposits and issue conservative, long-term home mortgages. Garn-St Germain freed them to make much riskier investments — commercial real estate, junk bonds, speculative ventures — while those deposits remained backed by federal deposit insurance. This combination meant thrift executives could take enormous risks with money the government, not they, would be on the hook for if it went wrong.
It went wrong at scale. Around a third of the roughly 3,200 savings and loans operating in 1980 had failed or required assistance by the mid-1990s, many due to outright fraud rather than simple bad luck. The Federal Savings and Loan Insurance Corporation, the industry's insurer, was itself insolvent by 1989 and had to be abolished; resolving the crisis required the Resolution Trust Corporation and a direct federal bailout that cost taxpayers an estimated $124–132 billion of a total crisis cost around $160 billion.
This was the direct, foreseeable product of removing risk controls from an insured industry without correspondingly strengthening supervision — a template of deregulated-risk-plus-public-backstop that would recur, at far larger scale, in 2008.