The headline intimates that Vanguard, like other investment companies don't have large stakes in private equity firms... the same private equity firms bankrupting hospitals across the country.
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
#72> 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.
You take on the risk every time you pay the local school district's real estate taxes. Well to be fair that's even riskier. After all you have no idea if the kindergartner will go on to get a college degree and start paying taxes. It's actually riskier than student loan bail outs.
Re: America's pensions can't beat Vanguard but they can close a hospital
#73> 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,…
One round of loan forgiveness is fine, but it builds an expectation of it in the future. All of the loans, growing larger and larger, just encourage universities to grow fatter and raise costs to students. If students could not borrow enough to attend, they would be forced to lower costs (not necessarily the very top universities, but all the rest).
The solution to that is rebuilding the state and federal funding for higher education with added regulations on where and how that money can be spent (perhaps even putting tuition caps in play).
The reason universities are so expensive is there is no limit on how much they can charge for tuition and no requirements on how much they pay their professors. It allows them to dump a huge portion of their funds into the marketing and athletic departments.
I know of a few religious universities who's mission is mainly to educate (so their well educated members can pay back more money to the church). While they do subsidize the educational costs, it isn't by as much as you'd think and it does result in some very cheap education.
There's no reason the government couldn't do exactly the same thing. It did right up until reagan.
Re: America's pensions can't beat Vanguard but they can close a hospital
#74> 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 Supposedly intelligent investors leaving money in accounts above FDIC limits ($250k per holder per bank, so $500k for joint account) were engaging in risky laziness.
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.
Re: America's pensions can't beat Vanguard but they can close a hospital
#75Pension funds should have a rule -- invest in technologies, industries and companies that create a deflation (by technology, scale, efficiency, etc). This will create better outcomes for pensioners. If they invested in cheaper housing, healthcare, pensioners can live without the constant fear of running out of money. The absolute first thing to invest in is clean energy which can be super cheap to zero to actually making money by supplying power back to the grid. Once energy is solved, it solves an entire spectrum of problems.
Increasing the money(number), while making everything else costly (a lot more costlier in reality because of fictional inflation number) is not only hard to achieve, but even if achieved, doesn't mean much. ".S. Dollar itself has lost roughly 98% of its purchasing power over the long term" -- random Warren Buffett quote.
Re: America's pensions can't beat Vanguard but they can close a hospital
#76Earlier quoted context omitted.
What if wealth taxes could be paid with shares instead of cash? And the shares went into a sovereign wealth fund? No forced selling, no crash.
What if the government owned all the corporations?
I don't know. You tell me.
I don't think that would happen for the same reason that there are income taxes and yet the government doesn't have every last dollar. Sovereign wealth funds sell assets too.
If you think sovereign wealth funds are communism, someone should tell Alaska.
Re: America's pensions can't beat Vanguard but they can close a hospital
#77> student loan relief inflationary and unfair
The problem with US student loans is usury.
Student Loan interest rates in the US can be as high as 9-13%. The government can borrow at 3.36% which even if we assume a 20% overhead is 4.03% to the borrower. Other countries/governments do a scheme similar to this, and it makes repayment realistic.
I'm certain someone will respond telling me the difference between Subsidized, Unsubsidized, PLUS, and private loans which completely missing the point: There shouldn't be a private entity that needs to turn a profit on the backs of students begin with, it is immoral. If you remove the private for-profit entity, the loan-type distinction goes away.
It isn't uncommon to read stories from people, who graduated and are in good jobs, and had no gaps in repayments that are now on 300%+ of their original borrowed amount.
Re: America's pensions can't beat Vanguard but they can close a hospital
#78> 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.
Great example of narrow rationality. Huge amount of Americas current problems can be traced back to a poorly educated population. Universal access to third level education, combined with a school system designed to educate - in direct opposition to current goal of producing labour units for corporate; would massively improve pretty much ever aspect of American life.
The market lens is myopic, the market cannot be expected to produce social goods in proportion to necessity - that's not any part of its function.
I agree that the student loan system is insane. Students need grants to cover cost of living while they focus on learning, education itself of course should be free.
Re: America's pensions can't beat Vanguard but they can close a hospital
#79I don't understand why we don't just ban private equity. Seems like zero value-add to the actual real economy.
Because the thing you want to ban isn't well-defined.
But do you agree that there are a set of bad actors who fall under the (not well-defined) term of "private equity"?
Is this a definitional quibble or do you not believe there is a problem?
Re: America's pensions can't beat Vanguard but they can close a hospital
#80> 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.
I agree with you about student loan forgiveness, but disagree with your assessment of universities as a system. The humanities (which are highly profitable for the university) are suffering an existential crisis because their funding keeps getting cut, while STEM programs (which have low or even negative ROI after lab/equipment/resource costs) keep getting expanded. There's obviously more nuance to that, but at a high level, universities are prioritizing majors which have higher job placement at the expense of their own bottom line.