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by ryguytilidie 5149 days ago
The worst part is that just like in the housing bubble, where lenders went into strawberry fields and offered home loans for 300k houses in california to undocumented immigrants making 10/hr and then asked for everyone else to bail them out because they are shocked the person wasn't able to afford the loan.

Same thing applies here. You recruit a bunch of people who have no business being at college and certainly can't afford it, convince them that they NEED college and should take on student loans, they struggle, graduate and have no real marketable skills. Bank that made the loan hassles the student and when millions can't pay them back, I'm guessing we have another bailout on our hands. Glad we learn our lesson last time!
2 comments
jchrisa 5149 days ago
If I had student debt I'd be thrilled not to pay it back. This country needs a general debt strike or perhaps a jubilee.
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prostoalex 5149 days ago
This hypothetical situation would work fine for you, but the guy applying for a loan next year would need to put a down payment for 2 years and have parents co-sign their house as collateral, as risk profile for student loans has changed.
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gee_totes 5149 days ago
A debt strike would be the ultimate 'hack' of our current economic system.
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veyron 5149 days ago
The right play is to short Apollo Group and Nelnet (loans) and DeVry and other for-profit schools.
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droithomme 5149 days ago
Student debt is impossible to discharge even through bankruptcy. There is zero risk to these loans because they are federally guaranteed loans. When the student defaults, the government repays the note holder as a matter of course, then the government goes after the student. The bailout is already guaranteed. The students will not be discharged of their debt anymore than the homeowners got their mortgages paid. What happened is the feds bailed out the bank losses, AND allowed the banks to evict the homeowners AND allowed the banks to keep the houses and resell them. But all this was only a tiny amount of the cost. On top of this were the CDOs and CDSs totalling, according to one estimate, one quadrillion dollars, more than all the assets in the world. The banks/investors/speculators are still being bailed out of these "losses" which were never real losses and only represented losses to unearned and absurd gains they hoped to make as part of a pyramid scheme.

The people stuck with the debt at the bottom of the pile don't get bailouts.

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