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patientrenter
Participant[quote=scaredycat] student loans….. but today, people are graduating med school, law school with 200-250k plus in loans. it’s tough to make a go of it for some. it could turn out to be a bad bet. what if tuition kept going up as everything deflated? What if people got out of school routinely with a million in debt? at some point, wouldn’t it just be rational to say fine, I’ll get the degree, society tells me i need it to get ahead, i know i’ll never be able to pay off the loan,I’ll default, then you can garnish my salary. there’s only so much they can take, 25% or so. if your monthly payment is $5,000 a month and you take home $5,000 a month, it’s not possible you can pay your loan. yeah, you took the debt on willingly, but doesn’t society have some obligation to have tuition vaguely match up with the economic value of the degree? or at least be forbidden from putting out any propaganda that the degree is worth something and is not a liability? should there be a disclaimer or warning on your tuition statement, something like “WARNING: this debt you are incurring is toxic. it is unlikely you will ever be able to pay it back based on current salaries.” Maybe this is where it’s all gone to. the debts become crazy, speculative, bear no relation to reality…and that makes people say what the heck, why not…[/quote]
scaredycat, home prices went up much faster than incomes because of easier and easier lending that ended up being based on non-repayment from income. The easier money didn’t help, because it just led to higher prices. What you’re saying is that the same thing is happening with student loans. The obvious solution is to make student loans harder to get. If people had to have realistic limits on their student loans, then higher education costs would stop escalating, just as home prices stop escalating when easy money stops flowing. Price always follows demand. Unlimited money = unlimited inflation.
I agree that people should be educated about repayment of their student loan before they are allowed to take it. Maybe they should be shown a schedule that shows what a level 15-year repayment of their projected end-of-education loans would look like, and what income they would need in order to have that amount to less than 10% of their income. Then ask them to research careers that they can get with their planned education and the incomes to go with them. If they come back with a career plan that makes sense, make the loan. Otherwise, no loan.
Participant[quote=scaredycat] student loans….. but today, people are graduating med school, law school with 200-250k plus in loans. it’s tough to make a go of it for some. it could turn out to be a bad bet. what if tuition kept going up as everything deflated? What if people got out of school routinely with a million in debt? at some point, wouldn’t it just be rational to say fine, I’ll get the degree, society tells me i need it to get ahead, i know i’ll never be able to pay off the loan,I’ll default, then you can garnish my salary. there’s only so much they can take, 25% or so. if your monthly payment is $5,000 a month and you take home $5,000 a month, it’s not possible you can pay your loan. yeah, you took the debt on willingly, but doesn’t society have some obligation to have tuition vaguely match up with the economic value of the degree? or at least be forbidden from putting out any propaganda that the degree is worth something and is not a liability? should there be a disclaimer or warning on your tuition statement, something like “WARNING: this debt you are incurring is toxic. it is unlikely you will ever be able to pay it back based on current salaries.” Maybe this is where it’s all gone to. the debts become crazy, speculative, bear no relation to reality…and that makes people say what the heck, why not…[/quote]
scaredycat, home prices went up much faster than incomes because of easier and easier lending that ended up being based on non-repayment from income. The easier money didn’t help, because it just led to higher prices. What you’re saying is that the same thing is happening with student loans. The obvious solution is to make student loans harder to get. If people had to have realistic limits on their student loans, then higher education costs would stop escalating, just as home prices stop escalating when easy money stops flowing. Price always follows demand. Unlimited money = unlimited inflation.
I agree that people should be educated about repayment of their student loan before they are allowed to take it. Maybe they should be shown a schedule that shows what a level 15-year repayment of their projected end-of-education loans would look like, and what income they would need in order to have that amount to less than 10% of their income. Then ask them to research careers that they can get with their planned education and the incomes to go with them. If they come back with a career plan that makes sense, make the loan. Otherwise, no loan.
Participant[quote=scaredycat] student loans….. but today, people are graduating med school, law school with 200-250k plus in loans. it’s tough to make a go of it for some. it could turn out to be a bad bet. what if tuition kept going up as everything deflated? What if people got out of school routinely with a million in debt? at some point, wouldn’t it just be rational to say fine, I’ll get the degree, society tells me i need it to get ahead, i know i’ll never be able to pay off the loan,I’ll default, then you can garnish my salary. there’s only so much they can take, 25% or so. if your monthly payment is $5,000 a month and you take home $5,000 a month, it’s not possible you can pay your loan. yeah, you took the debt on willingly, but doesn’t society have some obligation to have tuition vaguely match up with the economic value of the degree? or at least be forbidden from putting out any propaganda that the degree is worth something and is not a liability? should there be a disclaimer or warning on your tuition statement, something like “WARNING: this debt you are incurring is toxic. it is unlikely you will ever be able to pay it back based on current salaries.” Maybe this is where it’s all gone to. the debts become crazy, speculative, bear no relation to reality…and that makes people say what the heck, why not…[/quote]
scaredycat, home prices went up much faster than incomes because of easier and easier lending that ended up being based on non-repayment from income. The easier money didn’t help, because it just led to higher prices. What you’re saying is that the same thing is happening with student loans. The obvious solution is to make student loans harder to get. If people had to have realistic limits on their student loans, then higher education costs would stop escalating, just as home prices stop escalating when easy money stops flowing. Price always follows demand. Unlimited money = unlimited inflation.
I agree that people should be educated about repayment of their student loan before they are allowed to take it. Maybe they should be shown a schedule that shows what a level 15-year repayment of their projected end-of-education loans would look like, and what income they would need in order to have that amount to less than 10% of their income. Then ask them to research careers that they can get with their planned education and the incomes to go with them. If they come back with a career plan that makes sense, make the loan. Otherwise, no loan.
Participant[quote=arraya]……Yeah a few poor people that were irresponsible took down the whole western worlds banking system. Get a grip man.
[/quote]
I realize irony is your intention, arraya, but the unfortunate truth is that your statement is correct, with the substitution of “many” for “a few”. All of the trillions being lost are indeed due to non-repayment by Joe Homeowner of the loan he chose to take. Add it up over tens of millions of borrowers, and you’ve got the entire financial world and economy in a tailspin.
Was Joe an idiot to take a loan he didn’t intend to repay out of his income? Absolutely. Was Mr Banker / Investor an idiot to make the loan? Absolutely. Do we move to a system where people who do idiotic things with vast amounts of money evade taking full responsibility for their actions? Our economy will suffer terribly in the long run if we allow that to happen.
Participant[quote=arraya]……Yeah a few poor people that were irresponsible took down the whole western worlds banking system. Get a grip man.
[/quote]
I realize irony is your intention, arraya, but the unfortunate truth is that your statement is correct, with the substitution of “many” for “a few”. All of the trillions being lost are indeed due to non-repayment by Joe Homeowner of the loan he chose to take. Add it up over tens of millions of borrowers, and you’ve got the entire financial world and economy in a tailspin.
Was Joe an idiot to take a loan he didn’t intend to repay out of his income? Absolutely. Was Mr Banker / Investor an idiot to make the loan? Absolutely. Do we move to a system where people who do idiotic things with vast amounts of money evade taking full responsibility for their actions? Our economy will suffer terribly in the long run if we allow that to happen.
Participant[quote=arraya]……Yeah a few poor people that were irresponsible took down the whole western worlds banking system. Get a grip man.
[/quote]
I realize irony is your intention, arraya, but the unfortunate truth is that your statement is correct, with the substitution of “many” for “a few”. All of the trillions being lost are indeed due to non-repayment by Joe Homeowner of the loan he chose to take. Add it up over tens of millions of borrowers, and you’ve got the entire financial world and economy in a tailspin.
Was Joe an idiot to take a loan he didn’t intend to repay out of his income? Absolutely. Was Mr Banker / Investor an idiot to make the loan? Absolutely. Do we move to a system where people who do idiotic things with vast amounts of money evade taking full responsibility for their actions? Our economy will suffer terribly in the long run if we allow that to happen.
Participant[quote=arraya]……Yeah a few poor people that were irresponsible took down the whole western worlds banking system. Get a grip man.
[/quote]
I realize irony is your intention, arraya, but the unfortunate truth is that your statement is correct, with the substitution of “many” for “a few”. All of the trillions being lost are indeed due to non-repayment by Joe Homeowner of the loan he chose to take. Add it up over tens of millions of borrowers, and you’ve got the entire financial world and economy in a tailspin.
Was Joe an idiot to take a loan he didn’t intend to repay out of his income? Absolutely. Was Mr Banker / Investor an idiot to make the loan? Absolutely. Do we move to a system where people who do idiotic things with vast amounts of money evade taking full responsibility for their actions? Our economy will suffer terribly in the long run if we allow that to happen.
Participant[quote=arraya]……Yeah a few poor people that were irresponsible took down the whole western worlds banking system. Get a grip man.
[/quote]
I realize irony is your intention, arraya, but the unfortunate truth is that your statement is correct, with the substitution of “many” for “a few”. All of the trillions being lost are indeed due to non-repayment by Joe Homeowner of the loan he chose to take. Add it up over tens of millions of borrowers, and you’ve got the entire financial world and economy in a tailspin.
Was Joe an idiot to take a loan he didn’t intend to repay out of his income? Absolutely. Was Mr Banker / Investor an idiot to make the loan? Absolutely. Do we move to a system where people who do idiotic things with vast amounts of money evade taking full responsibility for their actions? Our economy will suffer terribly in the long run if we allow that to happen.
Participant[quote=HereWeGo]I agree with you as well, patient. Defaulters are defaulters, perhaps with the exception of those who are driven to BK by medical bills or the like.
Too many Americans are defaulting on student loans, credit cards, auto loans, and of course mortgages. Perhaps they think they’re sticking it to “the man.” I wonder if they’ll still think that once their standard of living crashes.
The thing that’s really unfortunate is that everyone is being dragged down into the profligates’ abyss.[/quote]
We’ll drink to that, HWG.
Participant[quote=HereWeGo]I agree with you as well, patient. Defaulters are defaulters, perhaps with the exception of those who are driven to BK by medical bills or the like.
Too many Americans are defaulting on student loans, credit cards, auto loans, and of course mortgages. Perhaps they think they’re sticking it to “the man.” I wonder if they’ll still think that once their standard of living crashes.
The thing that’s really unfortunate is that everyone is being dragged down into the profligates’ abyss.[/quote]
We’ll drink to that, HWG.
Participant[quote=HereWeGo]I agree with you as well, patient. Defaulters are defaulters, perhaps with the exception of those who are driven to BK by medical bills or the like.
Too many Americans are defaulting on student loans, credit cards, auto loans, and of course mortgages. Perhaps they think they’re sticking it to “the man.” I wonder if they’ll still think that once their standard of living crashes.
The thing that’s really unfortunate is that everyone is being dragged down into the profligates’ abyss.[/quote]
We’ll drink to that, HWG.
Participant[quote=HereWeGo]I agree with you as well, patient. Defaulters are defaulters, perhaps with the exception of those who are driven to BK by medical bills or the like.
Too many Americans are defaulting on student loans, credit cards, auto loans, and of course mortgages. Perhaps they think they’re sticking it to “the man.” I wonder if they’ll still think that once their standard of living crashes.
The thing that’s really unfortunate is that everyone is being dragged down into the profligates’ abyss.[/quote]
We’ll drink to that, HWG.
Participant[quote=HereWeGo]I agree with you as well, patient. Defaulters are defaulters, perhaps with the exception of those who are driven to BK by medical bills or the like.
Too many Americans are defaulting on student loans, credit cards, auto loans, and of course mortgages. Perhaps they think they’re sticking it to “the man.” I wonder if they’ll still think that once their standard of living crashes.
The thing that’s really unfortunate is that everyone is being dragged down into the profligates’ abyss.[/quote]
We’ll drink to that, HWG.
October 11, 2008 at 8:00 PM in reply to: Thank you Clinton for the Sub-Prime Boom! 1999 NYT Article #286013ParticipantVeritas, I’m OK with prostitution. But I am not OK with corruption that ends up costing taxpayers and others trillions in losses. That’s what happened here. Corruption flowed to the Dems through Fannie and Freddie, and corruption flowed to the Reps through NAR, mortgage brokers etc. And there was lots of shared corruption too. Goldman and other banks up to their knees in this were more Dem than Rep, and there were Reps getting money from Fannie/ Freddie.
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