[digikata]

It's the next crash through a different vector - if the loans aren't dischargable, a large portion of the the economic activity that young people normally generate as they grow along their career path is now siphoned off to repaying loans. That's a low value use of the money to the rest of the economy. Maybe it doesn't end in a dramatic crash but an economic stagnation for as long as inflation is low (inflation being a side channel way of devaluing those loans...).

An interesting note: http://www.npr.org/sections/money/2015/09/05/437628996/episo...

[cryoshon]

We can already see this in the US economy. Millenials are largely putting off traditional milestones like marriage, car ownership, having children, saving for retirement (or saving at all) and home ownership for lack of capital.

These are pretty major drivers of consumption, but think about the second order effects: fewer home pools being built, fewer new auto parts needed, fewer childrens clothes being bought, fewer weddings to need DJs, etc. There's quite a bit of fallout there, and it's going to be hard to pin John and Son's pool construction company going tits up on student loan debt slowing the economy, even if it's the case.