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Student debt isn't likely to cause a 2008 crisis since the vast majority of it is held by (or backed by) the government.
by rhino369 7y ago
Student debt isn't likely to cause a 2008 crisis since the vast majority of it is held by (or backed by) the government.
- jackcosgrove 7y agoAlso student loans cannot be discharged in bankruptcy, so there will not be a dramatic crisis triggering writedowns. The digestion of bad loans will take decades.
- dragonwriter 7y ago> Also student loans cannot be discharged in bankruptcy Yes, they can, though it's harder than other unsecured debt.
- jackcosgrove 7y agoIt's such a rare event that it wouldn't happen at the scale to trigger a financial crisis.
- xzel 7y agoSo I actually have a question wrt to the fact the government backs most tuition loans: what is really the difference if the US starts a forgiveness program or everyone defaults and the government pays back the lenders? Aren't the tax payers paying something similar both ways?
- skinnymuch 7y agoIsn’t defaulting on student loans and not having the money garnished incredibly hard? If so, it wouldn’t be possible for more than a small fraction to do it.