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sure there must be some wall street guys betting on a college-loan bubble like they did for the housing-loans.
by koppo 13y ago
sure there must be some wall street guys betting on a college-loan bubble like they did for the housing-loans.
- rayiner 13y agoBetting on what instrument? Loans are mostly federal. For what it's worth, the student loan program is solidly in the black for the federal government.
- toomuchtodo 13y ago"The U.S. government is forecast to generate $185 billion in profit over the next decade from students and their families under an overhaul of the federal student loan program endorsed by the White House and approved by the Senate on Wednesday. The profit figure, if annually averaged through 2023, would place the U.S. student loan program among the 20 most profitable public companies in the world, according to Fortune magazine’s annual list of the world’s 500 biggest companies. The bipartisan Senate bill would increase the government’s profit off student borrowers by more than $700 million compared with existing law, the Congressional Budget Office said." http://www.huffingtonpost.com/2013/07/24/obama-student-loan-profit_n_3648747.html http://www.huffingtonpost.com/2013/07/24/obama-student-loan-...
- rayiner 13y agoHonestly, I'm okay with the student loan system, I just think schools need to face tuition caps to be eligible for federal student loans. My wife and I have substantial student loans from law school. We got good jobs and can afford to pay. Meanwhile, lots of people don't and can't, and rely on the governments very generous and flexible repayment terms. As long as the program as a whole turns a profit, its a cross-subsidy, and I think that's great. People who take student loans should be uniquely willing to pay to spread out the risk.
- toomuchtodo 13y agoLet me take this a step further then. If we're going to cap tuition (price controls), why not increase taxes as well? College becomes much cheaper ($10K for your degree, not your semester), and society, the student, and every future employer benefits. I understand people don't like taxes sometimes. Even me. But with them, I buy civilization.
- rayiner 13y agoThere is a place for that, but the thing I like about the student loan system is that the people who benefit from the system pay for it. I think we have too many taxes in the US where the benefits aren't broadly distributed, which undermines support for those programs.
- jessaustin 13y agoI'm not an investment adviser, but I have to think there are many ways to bet on a rise in bankruptcies among young working people.
- iyulaev 13y agoExcept education loans don't get cleared in bankruptcy!
- tghw 13y agoNo, but it'll help send them to bankruptcy.
- jessaustin 13y agoYes, that's what I meant. Bankruptcy won't get the federal mafia off your back, but it will discourage all lesser loan sharks.
- NoPiece 13y agoWhat about betting against for profit universities which, on the shadier side, seem to be using unqualified students to grab federal loan money? Seems like they could get hit hard if the loan money starts to dry up.