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Interest also compensates for the other things that money could be doing. If I didn't loan it to you (or a student), then I would be doing something else with t
by trothamel 8mo ago
Interest also compensates for the other things that money could be doing. If I didn't loan it to you (or a student), then I would be doing something else with the money, even if just buying a government bond.
- thatcat 8mo agoI'm not sure that is accurate. You need a borrower to do that. If there were other low risk borrowers they would also lend them money, it's not a zero sum game. I'm no banker, but pretty sure the bank doesn't lend itself fractionally reserved loans and buy t-bonds.
- downrightmike 8mo agoCollege grads also pay on average 10x the taxes above a HS grad, so there is a huge disconnect on the repayment the lenders get. Once you pay the SL amount in taxes, you should be done.