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The student loan crisis will dwarf the housing market crash.

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Re: The student loan crisis will dwarf the housing market crash.

#91

Post by csmeder »

CWuestefeld wrote: post #38

I got as far as The pursuit of profit is a common theme in all of the documentaries I have listed, which is what ultimately led to the predicament we are in today. That tells me that the author doesn't have the slightest understanding of economics. That being the case, there's no sense reading about his economic predictions. UPDATE: I think I overstated that. What I really should say is... The author appears to be of…

Yeah. Maybe he meant? - "The pursuit of short term profit is a common theme in all of the documentaries I have listed, which is what ultimately led to the predicament we are in today."

Meaning that instead of building a brand that people trust and will bring in wealth for years, they are using tricks to swindle people and make a lot of money in the here and now. Like what the mortgage companies did before the recession.

Re: The student loan crisis will dwarf the housing market crash.

#92

Post by yoden »

moxiemk1 wrote: post #78
ahlatimer wrote: post #56

Earlier quoted context omitted.

I think you're overestimating the annual cost of school. I know it doesn't cost $25k/yr for me to go. I pay around $6k/yr for tuition, plus another $1k or so for books. According to College Board [1], that's about $1k less than the average for a student going to a public school, in-state. Your figure matches about what it costs to go to a private school, but, from my experience, public schools are also more likely to…

The school I'm at costs ~ $55k per year in the end, and the grants I get bring it down to about $30ish, and my parents make not much more than $100k (by working a full time and a part time job each) The public schools I applied to that weren't rolling-admission 5th year of highschool types ended up costing the same in the end, because they didn't give need-based aid, and their merit scholarships were not large for pe…

Need based aid isn't really targeted towards people who's parents who make more than 100k (more than the national average).

Merit scholarships are easy to achieve, given that you are exceptional. But if you are middle class and not especially proficient, I do agree that you have one of the hardest college experiences in america.

Re: The student loan crisis will dwarf the housing market crash.

#93

Post by yoden »

noodle wrote: post #31
patio11 wrote: post #20

It isn't going to be as bad as the housing market crash, because degrees are revenue producing assets for the overwhelming majority of people and houses are costs for the overwhelming majority of people. Also, student loans do not have any mechanisms in them which are designed to induce payment shock, like ARM resets are. (I am only half sardonic there.) If your loan repayments are $700 a month when you graduate, the…

> It isn't going to be as bad as the housing market crash then do you think that there will be a crash in this area, and if so, how bad do you think it will be? i imagine it wouldn't sneak up on us like the housing crash because of the nature of the loans, but that it could lead to a longer, lingering problem kicked off by the housing crash.

IMO it will be far less devastating, because it will be biased towards a higher earning, lower unemployment group of people (see statistics elsewhere in this thread).

Re: The student loan crisis will dwarf the housing market crash.

#94

Post by yoden »

CWuestefeld wrote: post #38

I got as far as The pursuit of profit is a common theme in all of the documentaries I have listed, which is what ultimately led to the predicament we are in today. That tells me that the author doesn't have the slightest understanding of economics. That being the case, there's no sense reading about his economic predictions. UPDATE: I think I overstated that. What I really should say is... The author appears to be of…

Great post. Companies making profit is generally good, because it grows possibilities for all. Granted, if they're doing it by exploiting consumers, that isn't true, but the author doesn't even consider that case.

Re: The student loan crisis will dwarf the housing market crash.

#95

Post by yoden »

nkassis wrote: post #54
muzz wrote: post #49

Earlier quoted context omitted.

> Harvard is now cheaper than some states schools, that's ridiculous. Which schools would those be? And are you using out-of-state numbers?

Well I was really referring to students who's parents are making less then 120k if I remember correctly, tuition is now waved. Effectively making it cheaper. I do not know how many percent of their student body fits this but those who's parent make more than this should in effect be able to afford the tuition rate. I meant it a tongue-in-cheek.

Tuition may be waved, but cost of living expenses might actually be higher than tuition + living at a state university. Private universities charge a ton for housing + food.

Re: The student loan crisis will dwarf the housing market crash.

#96

Post by jacquesm »

jseliger wrote: post #84
jacquesm wrote: post #83

Earlier quoted context omitted.

Free from the students perspective is actually a net gain for society because a better educated general public benefits everybody, not just the students. France comes to mind: http://en.wikipedia.org/wiki/Education_in_France Not 100% free but the stipend more than makes up for the very low tuition fee. There are also private schools and universities in France, they charge considerably more.

France comes to mind: ... and France's first university on the Shanghai Jiao Tong list: about 40. And it goes down from there, probably in large part because its universities are underfunded, like most of Europe's. Free from the students perspective is actually a net gain for society because a better educated general public benefits everybody, not just the students. The question is what happens on the margins and whe…

There are plenty of American Universities below position 40 on that list. I also doubt that if France would suddenly start to charge its students a huge tuition fee that the scores would go up dramatically.

http://www.arwu.org/ARWU2009.jsp

Given the size of the respective economies of France and the US it is actually surprising to see them in the top 40, I would never have expected that, if tuition were the secret then they should have been near position 100 or lower.

The first 39 slots are divided between the US, Japan, England, Canada and Switzerland.

Re: The student loan crisis will dwarf the housing market crash.

#97

Post by chopsueyar »

blahblahblah wrote: post #87
istari wrote: post #52

Earlier quoted context omitted.

You didn't factor in the very high possibility of someone dropping out. Google "college dropout rates". Consensus figures seem to be around 40% of enrollees don't have a degree 6 years later.

Choosing an arbitrary cutoff of 6 years and then assuming that everyone who didn't complete their degree within 6 years is a college dropout is not a particularly valid way to measure dropout rates. I completed my degree after the 6-year mark and I'm certainly not the only one to do so. These statistics erroneously include people like me in the dropout category. A more accurate method of measurement would be to track…

I have enjoyed your anecdote.

Re: The student loan crisis will dwarf the housing market crash.

#98

Post by jacquesm »

jrockway wrote: post #86
jacquesm wrote: post #62

Student loans are a rip-off. The market is set up in such a way that to get jobs you have to have a degree, and to get a degree you have to borrow a bunch of money so that you can pay your way through school if your parents aren't wealthy enough. The end result is that you'll be beholden to a bank for a good sized portion of your life (as if having a mortgage or rent isn't enough to hold you down). Smart societies ha…

I don't see this as being true. I went to a state school (UofI). It cost $700 a quarter. I got bored and dropped out. I had absolutely no trouble finding a job. Not having a degree has not come up at all, even when working for a big corporation that does extensive background checks. So I am not buying that college must be expensive, or that there is no way to get a job without completing college. Sure, some people ar…

> I am not buying that college must be expensive

That was my whole point. College doesn't have to be expensive, in fact it can be free or nearly so.

> I had absolutely no trouble finding a job. Not having a degree has not come up at all, even when working for a big corporation that does extensive background checks.

That's good :) My impression from friends is that having a degree would have been a big plus, not just for getting the job but also for the compensation.

> Overspending on college is no different than overspending on anything else.

That's true too. But we - TrueTech Canada Inc - spent a good bit of money getting some our employees that were seriously in debt out of it, and we helped a few that were still in school to avoid going in to debt. I was quite surprised to see kids that young saddled with such huge debts, $35K in one case.

> (Example: I just bought a $900 vacuum cleaner. That doesn't mean that if you don't have $900 you can't clean your house. It just means that I overspent.)

Sounds like you have some industrial cleaning power there :)

Re: The student loan crisis will dwarf the housing market crash.

#99

Post by waterlesscloud »

jrockway wrote: post #86
jacquesm wrote: post #62

Student loans are a rip-off. The market is set up in such a way that to get jobs you have to have a degree, and to get a degree you have to borrow a bunch of money so that you can pay your way through school if your parents aren't wealthy enough. The end result is that you'll be beholden to a bank for a good sized portion of your life (as if having a mortgage or rent isn't enough to hold you down). Smart societies ha…

I don't see this as being true. I went to a state school (UofI). It cost $700 a quarter. I got bored and dropped out. I had absolutely no trouble finding a job. Not having a degree has not come up at all, even when working for a big corporation that does extensive background checks. So I am not buying that college must be expensive, or that there is no way to get a job without completing college. Sure, some people ar…

You had a subsidized education. The cost of the education was not $700 a quarter, that was just the share of it that you paid.

Re: The student loan crisis will dwarf the housing market crash.

#100

Post by jrockway »

waterlesscloud wrote: post #99
jrockway wrote: post #86

Earlier quoted context omitted.

I don't see this as being true. I went to a state school (UofI). It cost $700 a quarter. I got bored and dropped out. I had absolutely no trouble finding a job. Not having a degree has not come up at all, even when working for a big corporation that does extensive background checks. So I am not buying that college must be expensive, or that there is no way to get a job without completing college. Sure, some people ar…

You had a subsidized education. The cost of the education was not $700 a quarter, that was just the share of it that you paid.

This subsidized education is available for anyone, though, just like the $70,000 a quarter educations are.
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