Student debt is not like housing. 1. Education is an game-theoretic arms race. It's very valuable iff you are the only few who have it. If you do not have it y

Student debt is not like housing. 1. Education is an game-theoretic arms race. It's very valuable iff you are the only few who have it. If you do not have it your are at a serious disadvantage. This creates an incentive to perpetuate the current overspending. This, obviously, is a recipe for entirely too much wasteful spending on education, and that needs to change, but i don't see how it creates a higher education 'crash'. 2. A diploma is not a commodity. You cannot sell it; you cannot flip one. You cannot speculate on it beyond the initial investment. No one is going to give you a education equity loan. It is not treated as collateral. Your diploma will not be repossessed, therefore the lenders need to be more conservative when issuing student loans (leave that to the actuaries). While i will admit there is the potential for losses in the ABS market, these are typically guaranteed loans. Will this create problem for the Fed? If the economy continues in the doldrums it's certainly a possibility, but comparing these securities to the chaos the CDS market sent us through, i doubt it.