Tag: Student Loan Debt Bubble

An idea I am behind..

The next big bubble that will burst, if the wholehousing market or government money printing & incessant borrowing leftist agenda, and forced anti-savings money policies, which the Europeans have adopted, doesn’t blow up on us yet again, will be the student loan bubble. There is another $1.2 trillion of tax payer liability, waiting to blow up as the economic policies of the nanny staters create even more unemployment for the people leaving college with massive debts. And when it goes, you can bet that it will be those of us that bailed the government, their friends and donors in the “Too big to fail” industries, and are now paying for the democrats to buy enough votes to give them more than even odds at retaining power and causing more misery for us all, that will foot the bill for that too.

So you can see why I live the idea of having colleges be partially responsible for giving out student loans. It would both act as a deterrent on the faster-than-inflation rise in higher education costs, and the idiotic admission policies that have turned everything but the hard science and engineering schools of practically all universities and colleges into indoctrination camps for the lefts idiotic ideas. That’s probably why nobody on the left would ever want to put a policy like this in place either, but it would definitely address the problems affecting the higher education establishment, and our country as a whole, all at once.

If a college or university lets an under qualified high risk of failure applicant in, usually over better qualified ones, and they fail, then having to pony up lets say 60% of what that student owes will act as the best deterrent against these stupid policies. Similarly, letting students attend college for a fortune to learn skills that will not qualify them to do anything but flip burgers, will wipe out all these fringe and useless degrees people pay an arm and a leg for, usually so they can party hard for however many years it takes to get a degree these years. I am sure the fluff schools, where most of the leftist indoctrination and monolithic thinking goes on these days, wouldn’t want something like this, ever. It would be the end of their goose that laid the golden egg era.

So, yeah none of the academic institutions now profiting of the incestuous relationships between the government mandated loans and their institutions, and even the leftists in government, would suffer from such a move, but the students and the tax payers that foot the bills when the students default, currently screwed over by these institutions and their buddies in government that like the deal because they get a lot of leftist indoctrinated drones that will vote for them, sure would.

Maybe that’s precisely why we will not get it ever. Right now the progtards are getting the best of all worlds in this exchange. The left has too much to lose, and they love doing things that make them rich and powerful, as long as they don’t have to foot the bill themselves.

Another bubble is about to pop

In this case we are talking about another subject we have bandied about here at Right Thinking, the student loan bubble, which president Obama just recently pretended to want to fix. From the article:

The largest bank in the United States will stop making student loans in a few weeks. JPMorgan Chase has sent a memorandum to colleges notifying them that the bank will stop making new student loans in October, according to Reuters. The official reason is quite bland. “We just don’t see this as a market that we can significantly grow,” Thasunda Duckett tells Reuters. Duckett is the chief executive for auto and student loans at Chase, which means she’s basically delivering the news that a large part of her business is getting closed down.

The move is eerily reminiscent of the subprime shutdown that happened in 2007. Each time a bank shuttered its subprime unit, the news was presented in much the same way that JPMorgan is spinning the end of its student lending. “It’s no longer sustainable and not the right place to allocate capital in the future,” HSBC Holdings Group Chief Executive Michael Geoghegan said in a statement the day HSBC shut down its subprime unit in 2007.

Oh shiz. This is going to screw a lot of people over. I am worried that as someone that did the right things I will still be the one tapped to pay for those that didn’t do the right things. That’s what Washington D.C. has become: the place where you can make others pay for your mistakes, after you humiliate them for not wanting to do just that.

Here comes the next bubble burst..

No, I didn’t say bubble butt, I said burst. And I am talking about the bubble created by the massive amount of student loan debt, which now surpasses even credit card debt in the US. The news that delinquencies are up drastically, is frightening.

Late last year, total student debt outstanding surpassed $1 trillion for the first time. Now, the problem of student loan delinquency is generating its own eye-popping numbers.

New data released today shows 11% of student loans were 90 days or more past due in the third quarter, up from 8.9% in the previous quarter and 8.8% a year prior, according to the Federal Reserve Bank of New York. It’s also the highest since at least 2003, when the bank first started tracking student loan delinquencies. “It’s a red flag and a warning sign that more Americans are struggling to repay their student loans — things are bad, really bad, and getting worse,” says Rich Williams, higher-education advocate at the U.S. Public Interest Research Group, a nonprofit based in Washington.

The latest data comes at a time when delinquencies on many other consumer debts, including credit cards and mortgages, are dropping. Overall, delinquency rates on outstanding consumer debt fell to 8.9% in the third quarter, from 10% a year prior, according to the FRBNY.

Anyone that doesn’t get their economic news from the usual DNC outlets in the LSM knows that contrary to the lies the economy is in dire shape, and the political shenanigans of the elitist class warrior cadre are sure to make thing even worse. It is no surprise that so many indoctrinate young minds that bought the liberal propaganda about college have racked a ton of debt pursuing their dreams, only to find out that in the real world, employers not only value skills, but shy away from people with crazy ideas that would hurt their businesses. Hence a lot of these youths are now sucking hard on the lemon life has shoved down their mouths.

I expect the number of delinquencies to go up, and go up drastically, as the US starts mirroring European levels of unemployment amongst the young. With way too many of these poor shlobs that were sold a false dream unable to shake the shackles of their student loan debt, they will all suffer a sever degradation of their living standards. But it will not stop with them. We will soon need to bail out the student loan industry as that comes crashing down.

The whole house of cards will then come tumbling down. A whole generation to see their futures not only be dimmer than those of their parents, but maybe even lost, in what I suspect historians of the future will describe as the age where because so many were duped by people pretending to mean well, humanity was plunged yet again into a dark age as the modern world’s economies imploded.

Don’t worry. I am sure they will come up with new taxes and cuts in the far away future that will magically fix this dilemma too. Social engineering sucks, but I am sure they will find a way to blame Boosh!