1. Survey: Many Expect Student-Loan Forgiveness

    Well, can’t say I find this to be any surprise:

    NBC News: 25pct of Millenials Expect Student-Loan Forgiveness

    Note to those of you who run political campaigns: If a quarter of those Millenials with student-loan debt expect it to be dumped off on the taxpayer, well, I’m pretty sure they’ll line up to vote for anyone who promises to make it so.

    I’m also fairly confident that there’s a word for folks who borrow money without the intent to repay.

    (Doesn’t apply to governments or super-large automakers, of course; we’ve established that. But you know what I mean.)

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  2. 1 Response to "Survey: Many Expect Student-Loan Forgiveness" ...

    1. On November 18, 2014 @ 10:25 am,
      Paul wrote:
      #1
       



      I think there are definitely issues with the Student loan setup in the US. The availability of easy money has done away with real world pricing – not dissimilar to healthcare- the ‘ticket’ price bears no relation to what insurers actually pay. Meaning the poorly or underinsured get a really bad deal – highest price, least able to pay. Similarly with University – scholarships and grants reduce the ticket price because they cannot directly offer a better price directly to high performers without screams of unfairness – Privileged minority pay least and are most desirable / likely to succeed. The end result is burden of higher debt (quantum) falls on those least likely to succeed, or have high earnings potential, and most likely to also fail covenants and get higher leveraged interest rates because their credit is poorer. A pretty stacked system that really needs fundamental overhaul. Those carrying current debt though ? no to forgiveness but protection against interest sharks would help. One interesting way would be to
      1/ Stop interest compounding
      2/ Change the rules so that a minimum portion of ANY cash paid in goes to capital (say 10-25%). That way there is hope of a capital reduction and the earnings on the original capital still pay. Lenders still get a rate of return but it should be capped reflecting that the consumer has no bankruptcy recourse to avoid the debt….. hmmm thought probably too much about this.

      PS I DO write to the ‘government’ sometimes – such as asking for an allowance to convert 401K’s to 401K Roths (pre tax to post tax) by paying the tax (when the market crashed). Implementation was very poor though – Pay all in 1-2 years initially then pay ALL at once – what ‘average Joe’ could do that ? I would have preferred a 10% conversion minimum or similar. Suggested it as a way for the govt to get tax receipts ‘now’ instead of future and cosnumer gets protected from future tax policy (and investment gains when the market bounced accrued tax free to the consumer)

       

       

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