Biz

Another Bubble About To Go … POP!

STUDENT LOAN DEBT COULD HIT $3.3 TRILLION BY 2024 By FITSNEWS  ||  This website has written on several occasions about America’s worsening student loan bubble … which as far as we’re concerned is just another example of government attempting to prop up its bureaucracies via dubious lending/ accounting. Well guess what ……

STUDENT LOAN DEBT COULD HIT $3.3 TRILLION BY 2024

By FITSNEWS  ||  This website has written on several occasions about America’s worsening student loan bubble … which as far as we’re concerned is just another example of government attempting to prop up its bureaucracies via dubious lending/ accounting.

Well guess what … danger is lurking.  This “mass inflatable” has officially exceeded the sub-prime bubble (which spawned the lingering recession when it went “pop”).

According to the federal government, nine percent of all student loans are currently in default – but another 11 percent are in forbearance and 12 percent are in deferment.  That’s one third of the total risk pool, people.  Oh and 13 percent of the loans outstanding are for students who are currently in college – and you better believe their job prospects are, um … yeah.

Add it all up?  We’re looking at more than $1 trillion in debt – which according to Zero Hedge is “more than all the credit card debt in America.”

According to the U.S. Treasury this bubble is projected to inflate to $1.7 billion over the next ten years – but that’s under the best-case scenario.  What happens if the reality of a perpetually limp employment market sets in?

Glad you asked … under such a scenario, the government estimates the bubble “would be expected to reach roughly $3.3 trillion in 2024, $1.7 trillion more than in the base case.”

UPDATE: At least this massive risk is worth it, right?  Ummm, yeah … about that.

***

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94 comments

James Fleming Jr December 10, 2014 at 2:36 pm

If you are a minority or an illegal you wont have to pay them back!

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Rocky December 10, 2014 at 2:40 pm

You will after you get amnesty. And that’s coming in the Boehner McConnell Graham McCain Rubio Immigration Reform bill of 2015. Also known as Welcome Mi Compadre.

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SCBlueWoman December 10, 2014 at 2:55 pm

Simply untrue.

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Gregory Geddings December 10, 2014 at 4:03 pm

shhhh…don’t bust his bubble…

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Astird Levinson December 10, 2014 at 10:37 pm

Prove it.

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SCBlueWoman December 10, 2014 at 10:51 pm

Why don’t you. I’m not the one asserting that a minority or illegal (who can’t qualify for funds) don’t have to pay them back. Bless your stupid, uninformed heart.

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Gov't jobs December 10, 2014 at 3:06 pm

There’s always the GI Bill too for those looking for gov’t to pay the college bill.

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Smirks December 10, 2014 at 3:13 pm

“Why do they always send the poor?”

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Gov't jobs December 10, 2014 at 4:03 pm

They are easily bribed, it’s sad.

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FoxNews doesn't count December 10, 2014 at 3:15 pm

Proof?

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Nikki's Nanny December 10, 2014 at 2:52 pm

Your website is terrible. In both IE11 and Android’s Google browser your site rarely loads correctly and is very slow. You need a new WebMistress…

Or has Trikki Nikki been busy on other fronts…. Hmmm…

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Upgrade December 10, 2014 at 3:04 pm

Quit using shit and you might have better luck.

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Buz Martin December 10, 2014 at 3:08 pm

That’s what she said …

… to T-Rav!

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easterndumbfuckistan December 10, 2014 at 3:06 pm

Chrome and Firefox work quite well on both platforms. Who uses IE anymore?

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Smirks December 10, 2014 at 3:20 pm

Have to say on mobile it’s slow as crap compared to other sites. I’m thinking that’s caused by Disqus but I could be wrong.

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GrandTango December 10, 2014 at 3:28 pm

Didn’t he just hire Karl (Marx) to rectify the many deficiencies???…That result will be predictable…LMAO….They feigned divulging my peronal information…because I BEECH slapped them w/ truth so hard…

FITS always gave Nancy Mace credit…I guess now that he has ruined her political career by association…his site is left to its own devices…and Karl ain’t no Mace….

PS: I got some big news coming in regard to SCPSD…stay tuned… (: …FITS will be irrelevant…

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Smirks December 10, 2014 at 3:36 pm

You should hire someone to rectify your deficiencies, although I guess that would be akin to asking someone to drain the water out of the ocean with nothing but a coffee cup.

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Gregory Geddings December 10, 2014 at 4:06 pm

…or teaching a raccoon how to play checkers.

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Unfuckable December 10, 2014 at 4:11 pm

Uh, both of those can be done. How about, akin to getting GT laid by a living being.

Gregory Geddings December 10, 2014 at 4:42 pm

Of the human variety?

Unfuckable December 10, 2014 at 5:14 pm

Please, I’m talking anything breathing and with an orifice.

Yelsewh December 10, 2014 at 2:59 pm

It isn’t a bubble (that generally refers to overappreciated assets) and it can’t burst because the only way most folks can discharge the debt is death.

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Help please December 10, 2014 at 3:03 pm

It would be nice if the republicans would quit blocking any help with student loans. Proposing legislation offering relief from student loan debt would help the GOP court the younger demographic they been losing for decades.

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MashPotato December 10, 2014 at 4:19 pm

You’re literally advocating that the GOP buy votes with taxpayer money. This is why I’ve lost hope for political solutions to America’s problems.

Tuition has increased faster than the rate of inflation because of easy access to government (taxpayer) money. But don’t expect to learn that in economics class at your state university.

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Jackie Chiles December 10, 2014 at 4:21 pm

Helping people with student loans to offset policy decisions that helped put them there =/= buying votes. If you really believed that, you should’ve lost hope whenever the Republicans decide to keep throwing MOAR money at defense.

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MashPotato December 11, 2014 at 9:55 am

I also oppose throwing more money into “defense”. The reason I lost hope is not because politicians and their cronies exist to fleece the taxpayers, it’s because ignoramuses such as this guy like it this way. They want it this way, and will vote to keep it this way.

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Help please December 10, 2014 at 5:11 pm

Yeah, you don’t know what literally means.

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Rakkasan December 11, 2014 at 5:53 am

Exsqueeze me? Tuition has risen faster than inflation because you brilliant “shrink the gov’t until it’s the size of a bathtub” types decided to continually reduce the state’s dollars to their public colleges and universities. The percentage of state tax funding for these schools is now so low that it is becoming difficult to call them “state” schools anymore.

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You're an idiot December 11, 2014 at 9:26 am

There so much idiocy in your post that I can’t address it all, but I love this analogy you make because it infers that gov’t is the size of an ocean in context:

“Tuition has risen faster than inflation because you brilliant “shrink the gov’t until it’s the size of a bathtub” types decided to continually reduce the state’s dollars to their public colleges and universities.”

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Rakkasan December 12, 2014 at 7:57 am

Since you don’t have a clue, I’ll give you one (it is Christmastime after all): Grover Norquist. In that same spirit, I’ll give you another one: I didn’t get it quite right. It is : He (Norquist) has been noted for his widely quoted quip: “I’m not in favor of abolishing the government. I just want to shrink it down to the size where we can drown it in the bathtub.”

Rakkasan December 11, 2014 at 5:53 am

Exsqueeze me? Tuition has risen faster than inflation because you brilliant “shrink the gov’t until it’s the size of a bathtub” types decided to continually reduce the state’s dollars to their public colleges and universities. The percentage of state tax funding for these schools is now so low that it is becoming difficult to call them “state” schools anymore.

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Limbaughsaphatkhunt December 10, 2014 at 5:28 pm

Nah, the GOP is pretty much locked into the southern and midwest angry white male demographic.

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Good riddance December 10, 2014 at 5:32 pm

Luckily, they’re dying off faster than they can procreate. Except the Duggars, but their kids (especially the younger ones) are a bit dumb. Diminishing returns, I guess.

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Scooter December 10, 2014 at 7:38 pm

They procreate faster than homosexuals. That’s a fact.

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Money printing till the end December 11, 2014 at 9:17 pm

“It would be nice if the republicans would quit blocking any help with student loans.”

The free shit army will win eventually.

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GrandTango December 10, 2014 at 3:25 pm

I borrowed money to finish college. I had to, because I did not have Daddy to bankroll a 4-year drunk and smoke fest, like my leftwing classmates.

I graduated when Reagan was president. The economy was roaring and I paid it back in a year and a half…by doubling and tripling up. It is a great program. People w/ confidence in the American Way will, and should, bank on themselves…

As it is now: the economy SUCKS. You can bust your butt to get a degree..but there are NO JOBS, because the president POS has bankrupted the country…

Obama is running around crucifying white people, persecuting the EARNERS using the IRS…and using our money to pay illegals and lazy deadbeats to use food stamps and exist on welfare…

The worst part of liberalism is that it takes a while for the Dumb@$$#$ paid by it…to starve…But in the end, it always crashes on itself…as a lot of these IGNORANT F*#k college Democrats should be figuring out, if they were not so Stupid…

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neat December 10, 2014 at 3:38 pm

You finished college? Which one?

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Smirks December 10, 2014 at 3:51 pm

Mama T University, she even let him color the degree in crayon and hung it on the fridge.

He paid back his “loans” via Mama T withholding his allowance, likely paid for via SSI.

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neat December 10, 2014 at 3:53 pm

I really want to know. For real.

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Smirks December 10, 2014 at 4:09 pm

I want to say he hinted around at it being USC. Not sure though.

Rocky December 10, 2014 at 4:15 pm

I recall him saying he studied Germalism at USC – correct. He / she was part of the Ima Quee Er fraternity.

neat December 10, 2014 at 5:38 pm

Judging by the lack of writing ability, I guessed it was USC. Is everyone involved with FitsNews a USC grad?

E Norma Scok December 10, 2014 at 5:27 pm

Another FINE USC graduate…lulz.

Have you read that tripe he calls a “blog”? “Journalism”..indeed.

It reads about 2 steps below what Taylor on this site provides.

GrandTango December 10, 2014 at 4:14 pm

Do you frequent SCPSD?

neat December 10, 2014 at 4:15 pm

Don’t know what that is?

GrandTango December 10, 2014 at 4:42 pm

Find out, and then ask personal information.

neat December 10, 2014 at 5:12 pm

Sounds fishy. No thanks. I guess you made it up.

Calling You A Pussy December 10, 2014 at 7:53 pm

You, unlike Fits, can’t even use your real name to blog with? Shit son, you suck Fits’ teat to get a few hits along the way, too? Pitiful, just fucking pitiful…

E Norma Scok December 10, 2014 at 5:32 pm

Lulz…does anyone “frequent” SCPSD?

Not Us December 10, 2014 at 3:43 pm

Please, don’t use SC as an example for the rest of the country. Sure the economy sucks there and you guys are content with working for peanuts, but other places are doing fine and making a decent wage. You keep electing the same people and wonder why things keep sucking.

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Smirks December 10, 2014 at 3:50 pm

The worst part of liberalism is

…doling out money to red states whose dumbass political views keeps them broke and stupid and tries to infect the rest of the nation?

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Congrats! December 10, 2014 at 3:53 pm

GrandTango is the perfect example of a typical South Carolinian white male. Fucking perfect.

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E Norma Scok December 10, 2014 at 3:59 pm

If you graduate with a marketable degree, anyone can get a job.

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Fecal Matters December 10, 2014 at 3:42 pm

I’d suggest that if you renege on your commitment to repay your student loan, you’re scrubbed from your alma mater’s list of graduates. If you commit to purchasing and repaying a house or car loan and you cannot, in most cases, you don’t get to continue to live in that house or drive that car. Why should an education be any different?

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I know the answer December 10, 2014 at 3:51 pm

How about we make education as cheap as possible or even free. Are you fucking retarded?

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Smirks December 10, 2014 at 3:59 pm

Sorry, only Baby Boomers get cheap higher ed, the rest of you whipper snappers can pay up or hit the bricks.

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Jackie Chiles December 10, 2014 at 4:16 pm

Baby boomers seem to be the most out of touch with how much college costs today.

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E norma Scok December 10, 2014 at 5:32 pm

But yet they are the ones paying for their kids education.

Seems…odd that would be true.

Jackie Chiles December 11, 2014 at 12:04 am

Lol at the thought of baby boomers paying for their kids education.

College courses for $100 December 10, 2014 at 4:34 pm

College courses on youtube(or that style format, a la Khan academy) is what’s going to eventually kill off the evil/greedy/statist college system eventually.

The last card they have left to play is accreditation. Once the market puts the final knife is the “value” of accredited degrees that are still worthless even that state enforced monopoly will drop…just like Uber and taxi medallions.

Even MIT knows it’s coming, partially the reason why they put their curriculum online for free. (there’s other reasons, but that’s one)

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E Norma Scok December 10, 2014 at 5:28 pm

heh..do you want your brain surgeon or your bridge builder to have graduated from “Kahn Academy”?

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College courses for $100 December 10, 2014 at 7:44 pm

That’s a good point, but who says they can’t learn the basics over the internet and then move straight to an internship style hands on experience?

I don’t think anyone should discount what the internet is going to do long term for learning/education.

Think about it this way, if you had a blockbuster movie budget to produce a physics class, how good could you make it?

They only need to sell tickets at $7 a pop for a good movie….so naturally a course that is well done even though a much more limited in viewership really might someday only cost $100 and be much better than some graduate student droning boringly to the incoming class so he can finish his dissertation.

Scooter December 10, 2014 at 7:45 pm

That would be an improvement for some of them.

Smirks December 10, 2014 at 4:04 pm

Why should an education be any different?

Because car loans and mortgages are types of debt that can be dismissed through various means, including bankruptcy. Student loans cannot be dissolved as such.

Also, did you stop to think that zapping someone’s diploma for non-payment might also zap that person’s earning potential, which would make it even harder to collect on the debt?

On the other hand, if John Doe ends up having to work at Starbucks because his degree “vanished,” he might get his car repossessed and get forcibly evicted from his home by the bank, thus freeing him from his other financial obligations…

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Jackie Chiles December 10, 2014 at 4:11 pm

I think a lot of college grad debtors would gladly trade their worthless art history degree to be absolved from their student loans.

Making student loans survive bankruptcy has created an entire class of debt slaves that I don’t think was ever intended.

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Smirks December 10, 2014 at 4:13 pm

Trade in their liberal arts degree? But those are worth their weight in gold!

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So much shit December 10, 2014 at 4:08 pm

Shit screen name, shit comment, shit for brains…starting to notice a pattern.

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Fecal Matters December 10, 2014 at 10:33 pm

Same old witless comments out of a witless fool. Many things I say on here are in jest, you don’t seem to function very well cognitively.

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Bible Thumper December 10, 2014 at 4:18 pm

WaPo – Nearly 30 percent of college students who took out loans dropped out of school, up from fewer than a quarter of students a decade ago, according to a recent analysis of government data by think tank Education Sector. —-

Others get degrees that prove worthless for getting a job.

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Scooter December 10, 2014 at 7:43 pm

It would not be so bad if they really got an education. All that some of them get is a degree.

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Fecal Matters December 10, 2014 at 10:36 pm

Very true. A trip to a 4 year party so their daddy will foot the bill for their sports car. Graduate, move home and pretend like they’re educated while they wait tables at the local 2 steak house.

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Squishy123 December 10, 2014 at 3:43 pm

I thought this story was going to be on Clowney’s NFL career.

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E Norma Scok December 10, 2014 at 3:58 pm

‘cept that bubble has already popped.

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mamatiger92 December 10, 2014 at 3:58 pm

+1

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duh December 10, 2014 at 5:35 pm

If it didn’t involve football, most South Carolinians would not have any idea what a college or university was.

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Saluda Rapids December 10, 2014 at 10:13 pm

Figures the Gamecocks you hate the most are the ones who never lost to Clemson.

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Jackie Chiles December 10, 2014 at 4:09 pm

There really should not be this many people in default. Imo, the income based repayment plans that are based on 10% of your AGI are a stopgap measure to allow graduates to live normal lives in spite of their mistakes and repay some of what they owe. That is a short term solution that will be necessary for this generation of graduates caught between outrageous tuition inflation and a terrible job market.

The long term solution will be to only give student loans to people majoring in areas that show a strong chance for repayment and/or people who can show they will have xyz job lined up paying xyz amount upon graduation. Whether this risk/benefit analysis will be done by the government or a private company, it doesn’t really matter to me. The only way to stop colleges from letting anyone in with a pulse, building millions of dollars worth of unnecessary buildings, hiring additional administrators, and creating ever more worthless degrees is to dry up the spigot of money.

Right now, colleges have literally no incentive to do anything but grow more. Students can always borrow more to cover the gap. If there was not unlimited student loans available, colleges would feel the crunch and have to either lower tuition or go under. The current higher education model in this country is unsustainable. If it continues this way, we’ll be nothing more than a nation of highly educated debtors that were dumb enough to pay $200k in college tuition to qualify for a job as an administrative assistant.

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yep December 10, 2014 at 4:13 pm

??? Sorry, not used to reading things that make sense here. Thank you.

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Smirks December 10, 2014 at 4:20 pm

The long term solution will be to only give student loans to people
majoring in areas that show a strong chance for repayment and/or people
who can show they will have xyz job lined up paying xyz amount upon
graduation.

They also need to refuse loans to students going to colleges whose degrees aren’t worth crap, especially the for-profit ones that have mastered sucking every last red cent they can from students via financial aid.

Unfortunately, I see a crapton of lawsuits resulting from this “discriminatory” behavior. Besides, who cares if they can’t pay for their loans anyways? Uncle Sam’s got their back if it hits the fan.

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Jackie Chiles December 10, 2014 at 4:33 pm

Absolutely they do. Imagine if anyone could get an unlimited loan to buy any house you wanted, regardless of the ability to pay or the quality of the house. Literally every house’s value would skyrocket overnight because anyone can afford any house they want. The government is basically paying for the Biltmore house but getting a ramshackle garbage heap in return.

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Thank you Statist December 11, 2014 at 9:29 am

“Whether this risk/benefit analysis will be done by the government or a private company, it doesn’t really matter to me.”

Gov’t has created the problem via loan guarantees, and your solution is yet another gov’t program to do what they should have done in the first place….that’s brilliant.

It should matter to you who does the risk/benefit analysis…as gov’t can’t obviously ever do it correctly and they are risking taxpayer dollars. If the private sector does it, the risk of failure is theirs alone.

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Jackie Chiles December 11, 2014 at 1:07 pm

“If the private sector does it, the risk of failure is theirs alone.”

What country have you been living in since 2007?

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Thank you Statist December 11, 2014 at 7:27 pm

Your non sequitur fails.

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Rocky December 10, 2014 at 4:56 pm

I’m being moderated.

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Limbaughsaphatkhunt December 10, 2014 at 5:27 pm

This story highlights a classic failure of American society. Instead of investing billions and billions in our cozy contracts to defense contractors, we should be structuring a federal student loan program similar to Australia’s whereby students get to go to college and then only start paying back the loans on a percentage basis when they get a job that makes a certain wage allowing them to do so without crippling their finances.

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greedisbad December 10, 2014 at 10:01 pm

Does anyone know how much monies were spent lobbying the Federal Government this year? A colleague of mine recently told me he read that over $ 3.2 TRILLION was spent this year alone lobbying our 435 Congress people and our President and Vice President. I asked him to cite his source and I don’t recall where he obtained this information. If true, where does that money go, and why can’t it be used to retire student debt?

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jesse December 10, 2014 at 8:42 pm

Colleges and universities in Germany are tuition-free, even for foreigners.

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Well Now FITS December 10, 2014 at 8:53 pm

Fits, you gloss over one interesting fact that really highlights just how secure theses debts actually are. If you default on a federally backed student loan you lose your right to many benefits from the feds thatba lot of people don’t realize. E.g. SS. So a long term default on say $27k in undergraduate loans would ultimate SAVE the feds about $2-3 hundred K or more in the long run. Just a thought. I’ll call this the significant savings bubble…

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Jackie Chiles December 11, 2014 at 9:18 am

Except that a default on student loans would cause the student that defaulted basically to drop out of the economy for the most part. No car loans, no mortgages, no credit cards, lawsuits, bank accounts frozen, and on and on literally until the debtor dies.

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harvard December 10, 2014 at 9:51 pm

Eliminating the atavistic, superannuated, positively medieval practice of tenure would be a very modest and rational step in reducing obscene college tuition costs…

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Guest December 10, 2014 at 10:55 pm

Why did Cemocrats nationalixe the student loan industry as part Obamacare legislation, and to what effect?

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PCAlum December 11, 2014 at 11:31 am

as a person who got scholarships and paid his way through college and finished with only about 5k in debt, i really would feel discriminated against if all of a sudden student loan debt was repaid. can i get my 5k back?

also student debt cant be compared at all to the sub prime mortgages. there is no asset for the bank to seize and there is no bankruptcy that absolves you of student debt.

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TaraDeSaussure December 11, 2014 at 1:32 pm

what the fuh…is in that bubble……a chicken being tortured under glass?

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TaraDeSaussure December 11, 2014 at 1:35 pm

when I was in college, and grad school, tuition was about 2 months of rent for what a downtown apartments or condos in Charleston or Greenville go for today….I feel sorry for those who borrow but caveat emptor. They signed on the line.

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