4 ms·

College presumably increases the borrowers earning potential. Not so, a house. Average student debt load I believe is much less than $100k. 5% interest accrue

by pbreit 7y ago

College presumably increases the borrowers earning potential. Not so, a house. Average student debt load I believe is much less than $100k. 5% interest accrues very modestly. The bankruptcy thing is irrelevant to this discussion.

wpdev_63 7y ago
>The bankruptcy thing is irrelevant to this discussion. Well if we are talking about the American educational financial system then it's absolutely relevant to the discussion. Cars, houses, credit card debt etc. are all discharged with bankruptcy which keeps the markets in check. Student loan debt is the only debt that cannot be discharged when it becomes impossible for the debtor to repay. As a result we are with in a 1.3 trillion dollar[0] debt bubble. And with the government printing IOUs for the students, the universities/profit education centers take full advantage. If the students were able to discharge the debt then the market would correct itself and education would be affordable and there would be less economic risk. Right now the government is projected to go to a 30 trillion dollar deficit by 2030 with its government job programs and these education 'loans'. Even if you do not have student loans or work in the education system, you should be aware of the large debt bubble that's forming. And if Saudi Arabia, Iran, etc. decide to trade oil on different currencies... well then things will get interesting... It will affect everyone just like the mortgage crisis in 2008.
orthecreedence 7y ago
> The bankruptcy thing is irrelevant to this discussion. Wait, what?? Why do you think costs of education are skyrocketing? It's because lenders can write blank checks to 18 year olds who are going to be the ones footing the bill for the next 20-30 years. If student loans were bankruptcy-forgiveable, lenders would think very carefully about what loans they give out to who, and why. Schools would be focusing on education instead of building worthless buildings that remain mostly-empty (yes, I saw this happen at UC Santa Cruz) or lining the pockets of the administrators. Lenders would be incentivized to loan people money based on their income potential in the future, which does not currently happen. Bankruptcy is not only relevant, it's the entire crux of the issue. Make lenders partially responsible for the debt and you solve an entire slew of problems we currently face.

by pbreit 7y ago

wpdev_63 7y ago

>The bankruptcy thing is irrelevant to this discussion. Well if we are talking about the American educational financial system then it's absolutely relevant to the discussion. Cars, houses, credit card debt etc. are all discharged with bankruptcy which keeps the markets in check. Student loan debt is the only debt that cannot be discharged when it becomes impossible for the debtor to repay. As a result we are with in a 1.3 trillion dollar[0] debt bubble. And with the government printing IOUs for the students, the universities/profit education centers take full advantage. If the students were able to discharge the debt then the market would correct itself and education would be affordable and there would be less economic risk. Right now the government is projected to go to a 30 trillion dollar deficit by 2030 with its government job programs and these education 'loans'. Even if you do not have student loans or work in the education system, you should be aware of the large debt bubble that's forming. And if Saudi Arabia, Iran, etc. decide to trade oil on different currencies... well then things will get interesting... It will affect everyone just like the mortgage crisis in 2008.

orthecreedence 7y ago

> The bankruptcy thing is irrelevant to this discussion. Wait, what?? Why do you think costs of education are skyrocketing? It's because lenders can write blank checks to 18 year olds who are going to be the ones footing the bill for the next 20-30 years. If student loans were bankruptcy-forgiveable, lenders would think very carefully about what loans they give out to who, and why. Schools would be focusing on education instead of building worthless buildings that remain mostly-empty (yes, I saw this happen at UC Santa Cruz) or lining the pockets of the administrators. Lenders would be incentivized to loan people money based on their income potential in the future, which does not currently happen. Bankruptcy is not only relevant, it's the entire crux of the issue. Make lenders partially responsible for the debt and you solve an entire slew of problems we currently face.