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America's pensions can't beat Vanguard but they can close a hospital

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Re: America's pensions can't beat Vanguard but they can close a hospital

#131

Post by creato »

terminalshort wrote: post #47
epistasis wrote: post #24

> Larry Summers warned against “moral hazard lectures” and demanded SVB depositors be made whole immediately in 2023, months after calling student loan relief inflationary and unfair. Moral hazard for borrowers, bailouts for banks. Not lost on the public. I can't believe I'm about to say something that could be construed as a defense of Larry Summers, but here goes: bank depositors are not engaging in risky behavior,…

> bank depositors are not engaging in risky behavior, they are putting cash in a bank That is risky behavior. You can't earn interest without taking a risk.

Is there a lower risk, lower interest option with the same capabilities (ability to use the money to pay others)?

Genuine question, I have no idea, but I didn't choose my bank based on interest rate. I can't pay bills or transfer money if it's cash under the mattress.

Re: America's pensions can't beat Vanguard but they can close a hospital

#132

Post by Braxton1980 »

jazz9k wrote: post #45
epistasis wrote: post #24

> Larry Summers warned against “moral hazard lectures” and demanded SVB depositors be made whole immediately in 2023, months after calling student loan relief inflationary and unfair. Moral hazard for borrowers, bailouts for banks. Not lost on the public. I can't believe I'm about to say something that could be construed as a defense of Larry Summers, but here goes: bank depositors are not engaging in risky behavior,…

I disagree about student loans. The entire system needs to be dismantled. Universities don't care if their majors will result in a job and the student loans are a source of risk-free money. They need to start taking on the risk of all student loan, not me, the tax payer.

If you had a choice between nothing being done and forgiving student loans which would you pick?

Second. Let's say universities did take on the burden of loans, of course that would be via a bank right?

If that's the case. How would they enforce risk? Based on certain majors? Who would give a loan with no collateral to young people with no credit on the hopes the major they picked had a viable job market years from that point?

Re: America's pensions can't beat Vanguard but they can close a hospital

#133

Post by SpicyLemonZest »

shimman wrote: post #100
epistasis wrote: post #74

Earlier quoted context omitted.

So what do you do when your payroll is more than $200k? The depositors were not treating SVB as investment, they were bank accounts for doing transactions.

That's not our problem to solve, but seeing how millions of other businesses were able to pay people maybe it's SVB that needs to figure out how to do this and not lowly commentators.

Millions of other businesses do not have a secret strategy to pay people without ever landing >>$200k in a single account. Their banks just didn’t fail so it wasn’t a problem.

Re: America's pensions can't beat Vanguard but they can close a hospital

#134

Post by Spivak »

p_j_w wrote: post #117
Spivak wrote: post #96

Earlier quoted context omitted.

I think the point wound be to eliminate all borrowing for tuition. It would be drastic and universities would complain the whole time but band-aid has to be ripped off at some point. I don't think a solution other than welding shut the money font will have a meaningful effect. * Eliminate the entire federal student loan program. Just gone. No more loans. * Make it so that private loans for tuition and related expense…

Your solution means that only the wealthy can attend university, someone who grew up poor wouldn’t stand a chance.

Your argument is basically that current university costs are intrinsic and can't possibly be reduced but we know that isn't true. We have not two generations ago people paying for their college tuition with money from their part time jobs.

My grandpa paid his way to a PhD as a line cook. Got no financial support from family who were only slightly above dirt poor.

Like I don't want to be completely reductive but a good chunk of university classes are 30-100 people paying for a single dude and a room with chairs to lecture for 5 hours a week. This doesn't have to be ruinously expensive.

Re: America's pensions can't beat Vanguard but they can close a hospital

#135

Post by Braxton1980 »

codexb wrote: post #68
jazz9k wrote: post #45

Earlier quoted context omitted.

I disagree about student loans. The entire system needs to be dismantled. Universities don't care if their majors will result in a job and the student loans are a source of risk-free money. They need to start taking on the risk of all student loan, not me, the tax payer.

Ok, but forgiving student loans doesn't do that. It signals to borrowers that they don't have to repay high loans if their career can't support it. It tells borrowers that they can make risky loans without a chance of default. It tells universities that they can keep charging exorbitant tuitions because kids can still get loans to pay them. The solution is to allow judges the discretion to default them in bankruptcy…

>. It signals to borrowers that they don't have to repay high loans if their career can't support it.

The loan forgiveness wasn't a thing when many students took out the loans.

Re: America's pensions can't beat Vanguard but they can close a hospital

#136

Post by bux93 »

munk-a wrote: post #21
OGEnthusiast wrote: post #2

I don't understand why we don't just ban private equity. Seems like zero value-add to the actual real economy.

It'd be difficult to ban what we commonly describe as private equity (a.k.a. PE firms) without banning the private (a.k.a. random people) from being able to hold equity. Someone smart might be able to ban the kind of investment vehicles that have become the bane of modern productivity but we do still need some mechanism to allow investment.

Well, let's start with banning debt push down and then move on to the next tool used to privatise profit and socialise risks. You know, it used to be that unfair business practices were researched and banned, simple as that. Just throwing up your hands and saying "Well, what to do?" when there's, you know, a whole science in which people are trained, is disingenuous.

Re: America's pensions can't beat Vanguard but they can close a hospital

#137

Post by p_j_w »

wizzwizz4 wrote: post #22
nradov wrote: post #14

Earlier quoted context omitted.

Ban companies from owning other companies? How would that work exactly? Private equity is a convenient whipping boy for ignorant, low-information HN users who don't understand the basics of how finance works. You can certainly find examples of destructive or unethical behavior if you dig deep enough. What you don't see in the news are all the cases where PE saved companies that would have otherwise gone bankrupt.

You, presumably, have examples of these cases. Could you show them to us, please? (Given your understanding of the evidence available to us "ignorant, low-information HN users", you know you're making a bold claim, which creates a corresponding burden of proof.)

Did you read TFA? There are some great examples there for the health care sector, and not just one off sensational examples.

Re: America's pensions can't beat Vanguard but they can close a hospital

#138

Post by AlexandrB »

hparadiz wrote: post #114
sejje wrote: post #87

Earlier quoted context omitted.

So you believe uninvolved taxpayers should be on the hook when the 18 year olds make bad decisions. Cool cool.

Should post grad be funded by the government? Yes. Next question. Feel like I'm answering whether or not public schools should be a thing from some 19th century peasant.

It's a question of supply and demand though. Sure we should fund science post grad, I'm not so sure about humanities (supply already outstrips demand there). Saying we should fund "post grad" in general elides this complexity.

Public school is as much about providing babysitters for parents that have to work as it is about education. Notice how hard it is to be expelled from public school. Grades are irrelevant. This is very different from how post secondary education operates.

Re: America's pensions can't beat Vanguard but they can close a hospital

#139

Post by happyopossum »

> Pension capital is money that will not be needed for 20 to 40 years.

Is it though? Much of the article talks about public employee pensions, and many of those are ridiculously underwater. People tend to think of pensions as deposit accounts that grow a bit while you wait to retire, but in reality many of them pay out a portion of your pension deposits directly to retirees, because the money those retirees deposited has already been spent.

Re: America's pensions can't beat Vanguard but they can close a hospital

#140

Post by shermantanktop »

jahsome wrote: post #106
sejje wrote: post #87

Earlier quoted context omitted.

So you believe uninvolved taxpayers should be on the hook when the 18 year olds make bad decisions. Cool cool.

Do I believe in community, empathy, kindness toward my fellow human beings? Why, yes. Yes I do. Am I willing to pay a few bucks to put my money where my mouth yes. Why yes, yes I am.

The unfortunate reality is that your kindness and empathy is a resource that is being exploited by unseen actors.

You are being taken for a ride and you feel good about it.

I absolutely support maximizing access to education and I'm willing to pay for it. I'm not willing to prop up a giant unsecured-loan grift that transfers financial risk onto those least able to bear it, while universities jack up their tuition to grab their slice of this new pie.

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