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The student loan crisis is really an underemployment catastrophe

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Re: The student loan crisis is really an underemployment catastrophe

#41

Post by cf141q5325 »

AmericanChopper wrote: post #36
qntty wrote: post #25

Earlier quoted context omitted.

This isn't an article about the morality of student loans. It's about the economy. If the economy is struggling because of people unable to pay student loans, that's a problem. Doesn't matter whether it was 'right' that it ended up this way. The problem is that people have student loans that they are unable to pay. How to solve it is another issue.

The article doesn’t make any case for the economy struggling. ‘Struggling’ in this context would mean that there’s less skilled employment opportunities available than there used to be. The article doesn’t put forward any argument to say that’s the case. With increasing enrolments, the economy could be doing great and still produce underemployment. The question is why are people completing unmarketable (or not suffic…

>The question is why are people completing unmarketable (or not sufficiently marketable) degrees?

For the pursuit of knowledge. Universities are not job training. You getting a good job with your degree is a bonus not the intend outcome for a university.

Re: The student loan crisis is really an underemployment catastrophe

#42

Post by mikeash »

lotsofpulp wrote: post #30
lemcoe9 wrote: post #16

Earlier quoted context omitted.

I can absolutely confirm this. I have done work (not on this particular type of system, however) for many small-to-medium car dealerships, and they will spend roughly $400 to equip many of the vehicles in their inventory with ignition interlocks that can be disabled remotely. Here is their business cycle: 1. Purchase a used car from a customer for 80% of "fair market value." 2. Sell the car on a $0-down, 7-year note…

I don’t understand your use of the term “fair market value” in quotes, implying that it’s not the actual market value. If the seller and buyer are not under duress while selling and buying, why is the dealer not buying and selling at the market value?

If the dealer is buying at 80% and selling at 110% of some number then surely that means that number is not actually fair market value?

Re: The student loan crisis is really an underemployment catastrophe

#43

Post by wil421 »

thrower123 wrote: post #4
robohoe wrote: post #2

One thing that I noticed in this article and charts was the unprecedented growth of auto loans. They too have skyrocketed. That seems like another "bubble" waiting to happen.

In the last twenty years, new vehicle prices have doubled. My eyes just about roll out of my head when I see what the sticker price is for a new truck or minivan. I assume people must be leasing more than they used to, because I can't see any other way to get the payment down into a palatable $500/month range.

Simple, put down a larger down payment. I put down almost 50% of my last car purchase to get it down to ~$500.

Re: The student loan crisis is really an underemployment catastrophe

#44

Post by loganfrederick »

lotsofpulp wrote: post #30
lemcoe9 wrote: post #16

Earlier quoted context omitted.

I can absolutely confirm this. I have done work (not on this particular type of system, however) for many small-to-medium car dealerships, and they will spend roughly $400 to equip many of the vehicles in their inventory with ignition interlocks that can be disabled remotely. Here is their business cycle: 1. Purchase a used car from a customer for 80% of "fair market value." 2. Sell the car on a $0-down, 7-year note…

I don’t understand your use of the term “fair market value” in quotes, implying that it’s not the actual market value. If the seller and buyer are not under duress while selling and buying, why is the dealer not buying and selling at the market value?

Typically because there is an education and need asymmetry between the buyer and seller in a lot of these cases. If the car is maybe worth $3K cash, but a dealer can lease it to someone for $4K by requiring no money down but high interest rates on the loan/monthly payments, where does one say the "market value" is?

The dealer is getting $4K (or more in the cases where they repossess the car and re-lease it) because the buyer often has few options on how to get transportation so they're implicitly forced to take worse terms (say, they need a car immediately to get to their low-wage job otherwise they are fired and forced into worse poverty). Of course, you can still say the car doesn’t have a value until a transaction takes place.

These socio-economics dynamics mean cars have much more of a spectrum of "value" than just one-off car purchases. Framed another way with the parent comment, buyers are often under implicit economic duress, it's just not duress forced by the seller.

I'm not strictly opposed to markets like subprime auto/personal loans, as often these markets would look worse without these options. But a lot of times people see supply-and-demand situations in very limited scope and miss external factors that influence choices.

Re: The student loan crisis is really an underemployment catastrophe

#45

Post by travisjungroth »

mikeash wrote: post #42
lotsofpulp wrote: post #30

Earlier quoted context omitted.

I don’t understand your use of the term “fair market value” in quotes, implying that it’s not the actual market value. If the seller and buyer are not under duress while selling and buying, why is the dealer not buying and selling at the market value?

If the dealer is buying at 80% and selling at 110% of some number then surely that means that number is not actually fair market value?

That’s the spread and it exists in all dealer transactions. Also called “markup”.

Re: The student loan crisis is really an underemployment catastrophe

#46

Post by JJMcJ »

jmpman wrote: post #9

H1B compete with the newly graduated college students. Before people say that there’s no problem with STEM graduates finding a job, I’ll counter that many of my coworkers 20 years ago didn’t have STEM degrees, and were previously English majors, business majors, etc. They were people with technical aptitude who realized they had picked a field of study that didn’t quite suit their financial aspirations. They were abl…

Not just 20, but all the way back from the beginning of programming until perhaps the mid 80s.

English majors, telephone company employees who were getting a bit old to climb poles, bright high schoolers who got trained in the military, science grad school dropouts, etc etc, and somehow code got written.

Re: The student loan crisis is really an underemployment catastrophe

#47

Post by chrisco255 »

_carl_jung wrote: post #22
chrisco255 wrote: post #13

Earlier quoted context omitted.

I wouldn't put programming as valuable than English and Math. It's clearly good to know, but honestly since we're talking about exploding debt, how about fiscal education in schools??

Which do you think is more valuable knowledge, solving for x or summing the columns in an excel spreadsheet?

Solving for x, because it actually rewires your brain to think logically vs typing a pre-built function with zero understanding. Besides, a huge part of programming is thinking about variables.

Re: The student loan crisis is really an underemployment catastrophe

#48

Post by lotsofpulp »

mikeash wrote: post #42
lotsofpulp wrote: post #30

Earlier quoted context omitted.

I don’t understand your use of the term “fair market value” in quotes, implying that it’s not the actual market value. If the seller and buyer are not under duress while selling and buying, why is the dealer not buying and selling at the market value?

If the dealer is buying at 80% and selling at 110% of some number then surely that means that number is not actually fair market value?

I am disputing the existence of that number. If two parties enter into an agreement to exchange X for Y, and no one has a gun to their head, then the market value of X is Y at that time for that party, and the market value of Y is X at that time for that party.

Re: The student loan crisis is really an underemployment catastrophe

#49

Post by hobofan »

lemcoe9 wrote: post #26
joelbluminator wrote: post #18

Earlier quoted context omitted.

Why can't a 28 American with an English major do a coding bootcamp and find an entry level job? I'm sure if he's reasonable intelligent and ambitious he can. There aren't that many h1b's around competing with him, most American jobs aren't h1b jobs.

Why is "do a coding bootcamp" the common refrain from tech workers trying to help non-tech people?

Because the barrier to entry is still quite low. While maybe not "Anyone who could spell HTML could get a job" low, as said in another comment here, it's still so low that I'd wager a decently clever person with a good 3 month bootcamp can get a _entry-level_ job.

Re: The student loan crisis is really an underemployment catastrophe

#50

Post by AmericanChopper »

cf141q5325 wrote: post #41
AmericanChopper wrote: post #36

Earlier quoted context omitted.

The article doesn’t make any case for the economy struggling. ‘Struggling’ in this context would mean that there’s less skilled employment opportunities available than there used to be. The article doesn’t put forward any argument to say that’s the case. With increasing enrolments, the economy could be doing great and still produce underemployment. The question is why are people completing unmarketable (or not suffic…

>The question is why are people completing unmarketable (or not sufficiently marketable) degrees? For the pursuit of knowledge. Universities are not job training. You getting a good job with your degree is a bonus not the intend outcome for a university.

That explanation likely accounts for some of the underemployment. How much, I’m not sure, perhaps a lot of it. Now, this still leaves people with a debt they may be unable to service. Which is still a problem, and raises its own set of questions. But it’s a completely different problem to any of the other potential explanations.
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