There are those out there who think we have a serious student debt bubble and that it will soon burst.
The idea is that costs of higher education are going up and students are taking loans to cover them. The available jobs to pay for those loans are not out there. Therefore, the former students will not be able to pay back those loans (unless their employed parents do it for them). Either way, someone has to backstop those loans, be it private lenders or the Federal Government. There is no such thing as a free lunch.
On the other hand, some potential students may decide to avoid college or just go to the lower priced local Land Grant School, thus putting a financial strain on some of the more pricey institutions.
Frankly, I don't think the fix from the Democratic Congress back in March of 2010 will overcome the problems we are facing.
Hat tip to the InstaPundit.
Regards — Cliff
2 years ago