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US Household Debt Surpasses 2008 High

nytimes.com

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Re: US Household Debt Surpasses 2008 High

#361

Post by NLips »

yannickt wrote: post #197
dmix wrote: post #27

Earlier quoted context omitted.

It's just as likely the moral hazards of yesterday were never properly dealth with, market corrections didn't properly happen during the downturn, and we're seeing a continuation of misplaced capital. ie, far too much going into residential real estate and student loans, not enough being invested in business. I remember reading that small/medium business growth and capitalization has flatlined as the housing market f…

Our household debt levels in Canada put the US to shame. Our household debt-to-income ratio is at 169%. And our household debt is something like 2.5x our GDP.

Please can you explain that? If household debt is 1.7 * household income, and household debt is 2.5 * GDP, then household income is >1.4 * GDP. Surely household income is a subset of GDP?

Re: US Household Debt Surpasses 2008 High

#363

Post by tonyedgecombe »

zelos wrote: post #290
martin_bech wrote: post #287

Earlier quoted context omitted.

In Denmark everyone can get scholarships to pay for their entire education. That and they get a stipend for living expenses. Everyone gets this, young or old, rich or poor.

How do taxes work out in Denmark? I tried to work out how it would compare to the UK, but it seems significantly more complex to work out. I _think_ an average programmer on £50-60k would end up paying about 35-40% of their income in tax? Or have I completely miscalculated? Compared to about 30% in the UK

It's muddied slightly in the UK because of Employer NI, if you include that it gets a little higher.

Re: US Household Debt Surpasses 2008 High

#364

Post by SimbaOnSteroids »

ryandrake wrote: post #228
swimfar wrote: post #181

Earlier quoted context omitted.

I think his point was that he went to a college he could afford. It's true that not everyone can get scholarships to pay for their entire education. But no one has to pay $40k+/year in tuition to get a good education.

Yea, my point was both college selection and major selection should be guided by ROI. This was pretty thoroughly drilled into me by my parents and my high school advisors / guidance counselors. We couldn't afford much so I went to a low cost state school, took advantage of as many scholarships as I possibly could, and picked an engineering major. At no point in the process did anyone ever advise me to "follow my drea…

I did this as well, spent my first 3 semesters at a private school that cost 40k a year had a pretty decent scholarship but the kicker was that I was in a major that had a minimum starting salary around 100k. So I felt that going to this particular school was worth the debt I'd accumulate because of 1 the major, and 2 the socioeconomic status most of the students came from.

Anyways after 3 semesters I realized that I really didn't like the major I was in so I dropped outta that school and moved home and went to community college until I got myself together and motivated. When that happened I moved into a local state school that is known for being extremely good for its cost.

I don't regret going to the expensive school even if most of the credits didn't transfer, I met some great people there who will be valuable friends to have made. I also don't regret not going there anymore because it would have been way too expensive.

Re: US Household Debt Surpasses 2008 High

#365

Post by askl56 »

0xC0DECAFE2020 wrote: post #280
dennisgorelik wrote: post #277

Earlier quoted context omitted.

> If I had a "small $1 million loan" right now ... then your fate would be similar to the fate of a typical big lottery winner: having all your money spent in a few years and your life derailed. Children of wealthy people succeed not because of inherited money, but because of wealth management habits they learned from their parents.

They succeed because of connections, plain and simple.

It's not zero sum. As somebody who has come from money and made a lot of money in a field entirely unrelated to my parents and with zero financial help from them after university, a lot of the disparities I see between myself and others in my situation who came from more disadvantaged backgrounds is that they spend their money far less wisely because they think that, for example, a house in the country will make them happy. I know from my childhood that is not necessarily the case.

Re: US Household Debt Surpasses 2008 High

#366

Post by e40 »

lz400 wrote: post #139
manacit wrote: post #10

I don't know if it's a "bubble" (I am not qualified to say that), but I can't imagine that the current trend with student loans will continue. Looking at the numbers for someone entering college in 2017, it feels nearly predatory what a good portion of private and out of state colleges are charging. Even with financial aid, $30-40k a year for 4-5 years is insane. I was fortunate enough to have parents who made saving…

I truly don't understand the USA sometimes. Don't you guys know that in Europe higher education is free? Well where I'm from there was a very low nominal cost but my father was a public servant so cost was waived, I literally studied CS for 0 cost. And these countries are able to afford it all! Magic! I don't understand how people in USA are not aware of this and literally rioting in the streets. At the very least sw…

I'm in the US and I understand perfectly: we have been manipulated for decades to be anti-intellectual, distrust the government and think taxation is theft. The result is Donald J Trump. Cutting off your nose to spite your face. Complete idiocy.

Re: US Household Debt Surpasses 2008 High

#368

Post by stillhere »

crdb wrote: post #182
ryandrake wrote: post #104

Earlier quoted context omitted.

I don't know, maybe it's different now, but my generation (went to school in the mid 90s) was not told to "just go to the best college no matter what": We were also advised to consider the cost and carefully choose a major so as to produce a positive expected ROI. Obviously nobody has a crystal ball and you can never tell when huge, industry-wrecking changes are coming, but it was well understood that majoring in Und…

> not told to "just go to the best college no matter what" > majoring in Underwater Basket Weaving was not a great idea from a financial point of view I've met many people in places like McKinsey or Goldman Sachs (i.e. "elite" high paying jobs) with degrees from Oxford or Cambridge in Philosophy, English, Arch & Ant or Theology (in "decreasing usefulness"). Many more than, say, graduates in accounting or business adm…

I know someone who went to NYU who now makes $15/hr and is $90k in debt because they majored in media studies. I am not trying to make fun of them as I love them but they believed and still legitimately believe the lie that going to an Ivy League should have been enough for them to live comfortably. Problem is that doesn't matter when your thesis is literally based on playing Second Life. Not that there's no value in her thesis but the reality is people are not hiring for that.

Re: US Household Debt Surpasses 2008 High

#369

Post by Ntrails »

cstejerean wrote: post #257
crdb wrote: post #217

Earlier quoted context omitted.

Ah, but I'm not saying that Ivy/Oxbridge grads make better employees all else being equal (in particular salary). I'm specifically saying that on a financial/job hunting basis, it makes more sense to pick a prestigious university and "useless" degree than a "useful" degree at a non-prestigious university, in aggregate. When you are on the other side, other variables come into play. For example, elite grads might be g…

I think there may be some hidden variables there. For example the kids of a VP at a large company may very well go to Oxford and study philosophy and then get a job at McKinsey, but how much of that was based on the family connections rather than anything to do with the philosophy curriculum at Oxford. And some of those kids get into the ivy schools because their parents went there or made large donations, so again i…

>If you don't come from the right background I'm not sure that studying philosophy at Oxford is the best move.

Worth noting that in the UK until recently cost and university were un-related. Indeed, it's one of the aspects of the modern system that infuriates me. I despise the idea of a bright child choosing a mediocre university to save 2-3k of student debt per annum. I can't believe it's good for the state of society.

It's also worth noting that the terms of student debt in the UK are far far less usurious than in the US.

Re: US Household Debt Surpasses 2008 High

#370

Post by phdp »

stillhere wrote: post #368
crdb wrote: post #182

Earlier quoted context omitted.

> not told to "just go to the best college no matter what" > majoring in Underwater Basket Weaving was not a great idea from a financial point of view I've met many people in places like McKinsey or Goldman Sachs (i.e. "elite" high paying jobs) with degrees from Oxford or Cambridge in Philosophy, English, Arch & Ant or Theology (in "decreasing usefulness"). Many more than, say, graduates in accounting or business adm…

I know someone who went to NYU who now makes $15/hr and is $90k in debt because they majored in media studies. I am not trying to make fun of them as I love them but they believed and still legitimately believe the lie that going to an Ivy League should have been enough for them to live comfortably. Problem is that doesn't matter when your thesis is literally based on playing Second Life. Not that there's no value in…

NYU is not an Ivy League school though.
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