Contextual User Interfaces

There's a few reasons this is undesirable. The reason that leaps to the fore is that this means the password itself--not a hash of it--is stored in the application. Since people re-use passwords and usernames, that means a breach of security in one website could lose a large swath of many users' online identities. These days, most low-security websites randomly reset your password and email the new one. For financial or other higher security websites, two-factor authentication is normal.