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The Scariest Chart Of The Quarter: Student Debt Bubble Officially Pops As 90+ Day Delinquency Rate Goes Parabolic
We have already discussed the student loan bubble, and its popping previously, most extensively in this article. Today, we get the Q3 consumer credit breakdown update courtesy of the NY Fed's quarterly credit breakdown. And it is quite ghastly. As of September 30, Federal (not total, just Federal) rose to a gargantuan $956 billion, an increase of $42 billion in the quarter - the biggest quarterly update since 2006.
But this is no surprise to anyone who read our latest piece on the topic. What also shouldn't be a surprise, at least to our readers who read about it here first, but what will stun the general public are the two charts below, the first of which shows the amount of 90+ day student loan delinquencies, and the second shows the amount of newly delinquent 30+ day student loan balances. The charts speak for themselves.
This is how the Fed described this "anomaly":
Outstanding student loan debt now stands at $956 billion, an increase of $42 billion since last quarter. However, of the $42 billion, $23 billion is new debt while the remaining $19 billion is attributed to previously defaulted student loans that have been updated on credit reports this quarter. As a result, the percent of student loan balances 90+ days delinquent increased to 11 percent this quarter.
oh and this from footnote 2:
As explained in a Liberty Street Economics blog post, these delinquency rates for student loans are likely to understate actual delinquency rates because almost half of these loans are currently in deferment, in grace periods or in forbearance and therefore temporarily not in the repayment cycle. This implies that among loans in the repayment cycle delinquency rates are roughly twice as high.
We'll let readers calculate on their own what a surge in 90+ day delinquency from 9% to 11% (or as footnote 2 explains: 22%) in one quarter on $1 trillion in student debt means. For those confused, read all about it in this September article: "The Next Subprime Crisis Is Here: Over $120 Billion In Federal Student Loans In Default" which predicted just this.
* * *
And so it's official: Pop goes the student loan bubble, as just confirmed by the Fed.
Luckily student debt is dischargeable in bankruptcy. Oh wait. It isn't.
Source: Quarterly Report on Household Debt and Credit, Household Credit Excel Source
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double post...wtf?
Man it must suck if you make something for colleges because this gravey train is hitting the wall.
yes, they will go down without a fight and there isnt more made up money.
Hmmm. Latest wage reports show income going down. So ...how is it that Black Friday sales were up 14%?
CW tells me that if a person's income is down either a) They stop spending b) They raid savings/retirement c) They don't give a s*&t and spend anyways. Given the mentality of society today...I think it's behind curtain c
There was a point in time that if you really wanted an education you worked you butt off to save enough money to go to college. If it was imporant enough to you ...you made it happen. Most (repeat MOST) of today's "students" don't have the passion or commitment...all they're doing is what Mom or Dad want them to do. Go visit a college and ask one of the administrators how many "student's" drop out after one year. They get their student loans...lose interest...or the coruses are too far over their head....and they drop out. Uncle Sam is on the hook. Colleges don't give a rip because they want the $$$$.
Bath salts or loan payment? Bath salts or loan payment?
Bath salts it is!!
Buffett the fucking nut job.
Dimon Best to Lead Treasury in Crisis, Buffett Says:http://www.bloomberg.com/news/2012-11-27/dimon-would-be-best-treasury-secretary-in-crisis-buffett-says.html
That old coot needs to shut his yap and go away... far away...
TAX the shit out of college sports programs.
They're not making any money either. The conference realignment is the dead giveaway. It's a revenue sharing tactic
TAX the shit out of college sports programs.
Wall Street, the government and the educational institutions have created long-term debt slaves.
What happened to the protesters? Nothing changes in Washington until there is blood in the streets.
I am shocked, with no income or low income can't repay 100,000 loan. Who would have thought!
You are now officially indoctrinated... We are own your soul, so get back to work servicing the collective.
Act up again, and you will be sent through the " wood chipper"...
Student loans are unlike suprime mortgages in that most if not all of the debt is guaranteed by the Treasury. From a politician or bureaucrat's perspective, so what? A few accounting entries, a few hundred billion in unsterilized bond purchases by the Fed to, "further it's policy of economic growth, full employment, with stable prices through an accomodative monetary policy through 20XX." Viola! Student loan problem solved. Who really thinks the government or the Fed are going to let things get out of hand? They'll borrow and print until the consequences are at least as severe as the underlying issues.
And what do they learn?
Economics???
hahahahahaha
America is doomed. Only respect for hard workers trying to survive.
Dear Parents,
Maybe it's just a ZH thing, but I've never seen a parent posting here that said their kid's college tuition was overwhelming and they would be totally in debt with no job prospects when their kid was learning how to be a:
Electrician
Welder
Carpenter
Mechanic
And numerous PRODUCTIVE trades not listed in the above.
A blind welder is guaranteed a job before a paper-pushing economist. The blind welder has better vision and accuracy.
Fuck college, just educate yourself, stop worrying and just do it !
(Dale carnegie: how to win friends and influence people + Dale carnegie: how to stop worrying)
How long until Obumble / Uncle Ben announce QEDF1 (QE - Debt Forgiveness 1) for student loans and mortgages of $150,000 (or less). More CTRL+P to appease the masses...
FUBAR.
Maybe our young educated citizens are not so indoctrenated into the socialist utopian taught in school and have decided to say fuck you to the establishment and opt out of paying their debt
Could this be the start of the revolution?
No, their refusal (or more likely inability) to pay off their student loans isn't derived from a deep seeded hatred of the government or a need to stick it to the man, it's sheer laziness.
They're entitled to their good time at college, they're entitled to their expensive shit, and they don't like it when reality hits home.
If there is going to be any 'revolution' as many people here like to rattle their sabres about it's going to come from the top down, because the disenfanchised and apathetic youth certainly aren't going to do it. OWS by the hippies is about the extent of their creativity, which is now defunct as Washington and Colorado will start catering to their needs.
Food stamps.
Sign up now.
Shit is free.
Only those who are productive have to pay anything to the government.
Just tell me how to short it!
Sincerely yours,
Lloyd Blankfein
V = x4 + ax2 + bx
Translation: remind me at what % of a total population assuming a new behaviour is considered a tipping point?
{bonus points if it didn't require a student loan to learn the answer}
Many misunderstand the effect debt default has in a fiat debt based monetary system. Debt default is hyperinflationary.
can you explain this concept a little more please?
Bailout coming for those who "don't pay their fair share"
I always dress like a "vagrant" when I patronize eateries that specialize in meals under $10...
Don't want to piss off all the P.H.D.s serving me. No need for the staff to shit in my "special sauce"...
Funny as all hell.
Yen: That's some funny shit you say there.
Yawn, wake me when default goes to 100% and gets re-fi'ed 3x then maybe I will buy some intern slaves.
I want white ones, a few yellows and and a couple chocolate face ones.
There's an inflationary tsunami coming.
Debt defaults are deflationary
The Fed is the bad bank
You want to see this problem go away overnight?
Make the debt dischargable in bankruptcy - again.
2-3 months and this debt slavery would be done.
Tuitions would be reduced by 50-75% immediately, no one will lend on inflated tuition and lowered repayment expectations.
the beast is on the gobble
and all that matters is we're all headed for it's belly
http://youtu.be/ntmthFyaYzY
My oldest watched most of his classmates go off to college and have a blast -- loaning it up big-time. He has refused to participate - instead working two jobs, taking e-courses + on-site courses and applying for scholarships. He has received a congressional nomination to an academy but the competition is so tough and no one in line turns down those opportunities. But, he plans to get his undergrad credits at this less expensive option and is saving diligently...if the academy doesn't work out, he'll is trying an ROTC program as a possible back-up.
I respect this kid for being savvy and while I know he'd rather be off and having the "fun" college experience with his peers - he is smart enough to know that he is taking a wiser route. I'm hoping he sees this post so he knows I'm doubly proud of him.
Mom
$$$$ tuition ----- and for what?
In looking at my son's first-time college experience, he has a English comp prof who is absolutely worthless plus the guy does everything he can to avoid communication with my student. I've looked at the comments on papers - and from the looks of it, he is either an idiot or he drinks while he marks papers. I could absolutely wring this worthless guy's neck and the Eng Dept thus far protects him. My student is getting an "A" thus far but the average grades the prof reports for the class are primarily in the "50s" -
I'm starting to think this prof and some of the others are so discouraged with student performance and the fact that they don't seem to have any accountability whatsoever -- have just gave up and/or they just don't give a damn. Yet, in the meantime, the $$$$ colleges/universities are collecting is beyond obscene.
There are surely some dedicated fine profs out there but thus far, we have encountered absolutely no one anywhere near the worth of the enormous tuition costs. That's very sad.
@CoolBeans: What is your kid studying other than English? What is he/she trying to accomplish with this hugely expensive college degree?
Why buy the product? You know it's worthless, and in the end, the debt isn't worth the diploma.
Send your kid to a trade school, he'll be more valuable as a car or motorcycle mechanic, builder, plumber, electrician...can't outsource that to india (sort of to mexico, i guess).
My daughter in law goes to a private university, 54k a year!!! Glad I'm not paying for that mess, gonna be a fine arts major for 216,000 - then off to masters degree in FA.
She woulda been better off learning to put her ankles behind her ears for a rich man....
My suggestion: tell him to pass on ROTC and the academies. It seems like it's honorable, but it's not. It drains you. I did NROTC at one of the most expensive private schools. Within 4 years everyone who didn't go pilot is out and went to graduate school. Competent, hard working people have no place in the Navy, especially as officers. It sucks the life out of you and the "skills" you pick up are absolutely not transferable to the work environment. Total waste.
If I had to do it again, I would have bought a 4 bedroom fixer upper house near a college campus, fix it, rent it out to overleveraged college kids, and live the life.
Too bad its useless.
I wonder how many are econ majors? Judging from the numbers, I bet the econ majors in default are all Keynesians now!
They may have to wait until you draw Social Security and take it from there, but they will get the money one way or another. The only options are to either stay in school or die...otherwise, you will be paying back those loans.
If the "money" loaned was created out of thin-air by the banks based on depositors' deposits--theft and fraud, and
if the Fed prints money to prop up the fraudulent banking system and TBTF entities, and
if the government bails out TBTF and connected companies and unions--crony capitalism, and
if the whole house of cards is going to fail and implode one day soon any how, and
if the whole "system" is a lie, theft and fraud on steroids, then
DON'T PAY! Stop, no one should send another cent to any of these bastards--they stole the money they loaned you in the first place.
Or put another way: if Corzine can walk away after openly stealing over a billion dollars ($1Bil.) of client funds then you shouldn't pay any of these bastards back?
Don't!
Maybe you haven't noticed the 2 teir legal system... I smell debtors prisons (great for the private industrial prison complex) or involuntary government service somewhere in the future.
This is great news. We can finally put our pervasive, coercive and punitive police state to work that took us decades to build. No one likes to build a tool shed and not use it! Lets kick some student butt.
All your debt are belong to us
Lot of posts here seem to suggest that the current crop of recent college grads and college students are bottom feeders looking for a handout. As a graduating member of the class of 2008 I take great offense to this. What the older zero hedge posters seem to forget is that when they were going to college it cost them far less than what it costs us today. My mother graduated from a state university in Pennsylvania in the late 70's with average tuition costing around $700 a semester...good luck finding one credit these days that costs this much.
The problem is we were spoon fed from day one as impressionable teenagers to go to the most elite schools by our teachers and principals, family and friends, with no real education regarding the cost of an education and how difficult loans are to pay off. Sure I was naive and maybe I could have spent the time to actually research the cost, but every supposed authority was telling us the exact wrong thing to do. Perhaps I should have developed the great distrust I have for those in authority when I was 18, but I don't look upon my fellow generation with distaste, but mainly with compassion that they have been spoonfed the same bullshit I was. Sure there were plenty of kids smoking pot and binge drinking all day long on campus, but the vast majority of students I encountered were diligent hardworking students oftentimes working mulitple jobs in college and still ending up with loans.
Just a disclaimer in case im labeled a bottom feeder myself. I have paid off two loans since graduating and am working towards paying off my final one. To the older zero hedge readers, think before you criticize all of us and just be happy you were born in the 50's, 60's and 70's and not the 80's and 90's. I'm sure you did not possess the knowledge you have now when you were 18 and if born when we were would be just another kid signing on that dotted line
The reason the cost of an education today is equivalent in many cases to a mortgage is because the Federal Government took it upon itself to originate loans to any student who could count to ten using their fingers. If the college knows there is a buyer, in this case the government, to underwrite loans at grossly inflated prices guess what they are going to do....inflate the price of the education. Same thing with medicine today, medical costs became unaffordable right around the time the goverment decided to stick it's nose in that industry.
But don't you see? This is the agenda behind the politicians:
Want to go to college? Since you can't afford it now you are now beholden to the government and are forced to vote for the politician who promises to send you to school for free (it otherwise would be too expensive). Since college loans can theoretically be differed ad infinitum a free degree is essentially what you get. As well as an entire cross section of students who have no right to be in college to begin with.
And.....you get what you pay for, which in my esitmation has been severely watered down. Anecdotally speaking, it turns out that ALL my neices and nephews, all my friends kids, in fact every kid going to school is smarter than I am (was) when I was going to school. EVERYONE! Everyone has a GPA of 3.8 or better, and many have 4.2 out of 4. In some high schools I know, if the kid shows up all year and doesn't miss, (s)he is exempt from writing the final. Fuck. uh er what!!? Nothing like setting them up to fail. It used to be about the student doing the work, but, as my colleague indicates, its increqasingly about whether he is a good professor or not. Its never the student's fault. Fuck the work. So, I manage a small capital corporation in the business of financing entrepreneurs, expansions, etc. My hiring criteria, now, doesn't even acknowledge where the student received their training. Could be Yale, Harvard, MIT, Queens, or the neighborhood college. Don't matta!. Its all the same watered down shit. Today, I look for one thing and only one thing in new young potentials, and that is ATTITUDE. A desire to solve problems (and in particular knowledge problems), and a willingness to learn. We can teach them what they need to know, but, I cannot teach them a "willingness" to solve our organization's economic problems, or, anybody else's economic problems. I will NEVER discriminate between candidates based on where they received their education, or, what grades they attained because there is absolutely ZERO correlation between these criteria and their resulting productivity. Moreover, the higher up the education pyramid one goes, the worse the candidate's real world applicability becomes. Higher education is not what it used to be. Not even close. But this is typical of government involving itself in something that it has no business involving itself in. Price goes up, quality deteriorates. Always has, always will. So, I treat it as such. Sorry to offend those students who have fallen victim to a Class A ripoff. To those who have not yet been trapped, there are infinitely bettwe ways to earn gainful employment, while expanding your own personal knowledge base. There is no need to acquire and later carry debt servicing costs on $100,000 for jobs that do not exist that offer pay scales commensurate with your expectations, given that you have little or no experience at contributing to a firm's bottom line. That difference will forever and always be corrected by the market. Better get used to that little fact. Save those rare instances, you are not worth as much as you think you are, which by the way, the strength of the economy plays a very small part. So don't go thinking, "well if the economy just got a little better...." naaa uhhh. If you are as good as your asking price, then that means you are going to revamp my cost structure, or, generate our firm more revenues, such that the net benefit to the bottom line (discounted for risk) is greater than zero. I will for sure hire you because you are helping me become more competitive, which, is just what I need when the economy is not doing very well. For those who have incurred the better than $100K debt, let go of unrealistic expectations and default so that you can allow yourself to take on the experience you need at a lesser price. Pay the loan back later. Enter into a consumer proposal. Let bygones be bygones and start developing you career accordingly. Time's a wasting. Sorry if it sounds like I am lecturing.
Pareto: Your rant should be required reading before anybody signs for a student loan.
No reason to apologize for sounding like you are lecturing. The lack of paragraph breaks, however, is a different matter.
Pareto, you sound like a person who gets it and someone I could work for. I'm a junior at a 'prestigious' university in Chicagoland who woke up to all this Keynesian, Federal Reserve, TBTF, statist propaganda and I honestly want out and to go Galt and do things for myself. All seriousness, what type of people do you look to hire and what kind of positions? I have a solid foundation in 'finance' and know how bogus a lot of it is from my studies of Von Mises Institute and ZH. Right now I kind of am pondering becoming a trader just until I can figure out some entrepreneurial endeavor. No interest really in being an 'investment banker', despite that being regarded as prestigious by most of my peers here who are likewise studying econ. Not one of them knows how corrupt the Fed is and how most of this is just usury, sadly.
In all seriousness, if you are looking for somebody with independent initiative and who 'gets it', I would be interested, because I just want to genuinely create value and help people preserve and enhance wealth (PMs being the foremost of that portfolio strategy).
@Jocobin - That was an excellent post. You failed to mention what you are studying.
Edit: Since there was no reply to a simple question about what he/she is studying, I have to assume it's one of those paper-pushing, non-productive jobs that every college kid dreams of after graduation. Enjoy your debt slavery, mon ami.
Don't take it too seriously.
As a general rule it is those with the least to say that do the most talking. They take an interesting report about the trend in student loan defaults and turn it into a forum on "kids these days". Additionally about 85% of people you meet are lazy idiots and most of them dwell on forums.
As in any situation where money is available easily as in "buy now pay later" there will ultimately be consequences.
Speaking of "change" I'm thinking that there was a need for changing of underwear when that graphic was first viewed. Appears to me the kids got smart so apparently the education wasn't wasted. Muffy we've been screwed!
It has always been true that predators and busy-bodies brainwash everyone they can to believe their BS lies, and follow the absurd path through life they promote.
It has always been true that the most creative, brilliant, talented, productive and extraordinary people learn to ignore everyone... and observe for themselves (first-hand), reflect, grapple, think for themselves, try, try, try, try, try for themselves (and fail, fail, fail, fail for themselves a great many times)... before they finally start being successful, and ultimately recognize the reasons why.
Sure, you were screwed by your elders and your parents and all the "big shots" that were presented to you by media and just about everyone around you. So was almost everyone... in every era.
Yes, you were naive. So now, stop being naive. The predators who lent you that fiat, fake, fraud, fiction, fantasy, fractional-reserve money did not produce the wealth (by being productive) they lent to you, they simply pushed a few buttons on a computer which credited your bank account, or the bank account of your university. They did nothing for you, except attempt to scam to into being their slave for the rest of your life. Your life, not theirs. But they are counting on your education to not ever, not even once reveal the obvious to you --- that the entire system, universities included, is nothing but:
predators enslaving sheep
True, their scams have been so wildly successful that now they are attempting to enslave every living being on planet earth, including those who understand what they are, and understand the diabolical plans they have. And they expect to succeed because the vast majority of "educated" morons have been utterly and completely brainwashed into knee-jerk acceptance of any and every predator-mandated demand. They know 99% of you "educated" slaves and 99% of complete TV-addict imbiciles will accept their utterly, totally, completely fiat, fake, fraud, fiction, fantasy "authority" over everyone, just as surely as you accept their fiat, fake, fraud, fiction, fantasy, fractional-reserve debt "money".
If you have savings, and they aren't all in the form of real physical assets like "gold" (under your control, not some ETF), then you prove that you do accept their fiat, fake, fraud, fiction, fantasy LIES.
Now listen up. This might be the most difficult thing for you to understand. Those of us to stand on big soapboxes and criticize people like you... have previously given ourselves much harsher critiques for stupid errors we made in our own pasts. However, we were and still are revolted by our mistakes, and what makes us so insufferable is how clear we are that accepting those lies and fictions and authorities are deadly. And not just deadly, but horrifically painful before death finally comes... and on a planet-wide scale to boot.
We are difficult to listen to because we very clearly know how serious is the current state of the world, and the overwhelming acceptance of fictions by virtually every human being on planet earth. Those odds make waking people like you up an astronomically daunting task. Remember, we have our own lives to live too, and lots of our own work to do, and lots of our own goals to achieve. We don't have time for this. So take a clue and take over control of your own brain. Reject everything any "authority" tells you. Observe, think and choose ALL your actions for yourself. Just don't harm others in the process, otherwise be a totally free agent.
PS: In my case, the break from authority came very early (age 4), and was competely "sharp". It was also quite simple. I got different answers to the same question from different adults, even different "authorities". I also knew the most basic history that every 4 year old knows... that people in different parts of the world believe in different gods and religions, eat [and enjoy] different foods, accept different ethics, and so forth. This made it blatantly obvious that humans were not learning anything from reality, only absorbing the lies and biases of people they live with. The above basic first-hand observations, which pretty much every 4 year old has, was sufficient to make clear to me that IF I wanted to understand reality, I had no alternative but to observe first-hand, and try to make sense of what I saw with my own mind. That seemed an impossible task, the world being so huge and complex, and I assumed I would forever be "stupid" given the huge quantity of stuff to observe, learn and comprehend. However, I was wrong about that. Given decades of intense, interested observation and honest, curious thought, I have been able to understand a great deal about the fundamental nature of reality and consciousness. And indeed, it is only because I took responsibility for my own mind that I was able to come to understand difficult issues, topics and fields of study. If I had accepted some lame answer by some lame authority to difficult questions, I would not have tortured myself for years... even decades sometimes... to understand a difficult question or topic. ONLY because I did insist upon "understanding for myself" was I able to learn and fully understand exceedingly important things that [apparently] no other human being understands... and hundreds of important things that tiny minorities understand. Unfortunately, there is no shortcut. You are either utterly honest with yourself and refuse to believe anything that you cannot understand by your own observation and thought... or you are nobody - mere mismash of ideas and soundbite lies created by others for their own advantage. In that case, you don't even exist as an independent being, only as a grab-bag collection of BS spewed out by others that accumulated in your brain. The choice is yours. Take total control of yourself, or let predators control you. They are happy to do so, and are doing so to 99% or more of world population.
PS: Quite the scam, huh? That people will actually go into $100,000 debt to have their brains destroyed. I mean, really! Anyone willing to subject themselves to what passes as "higher education" these days, has already proven they are too naive and/or stupid to learn. That kids must become insightful enough to recognize this before age 18 is a sad statement.
Yeah, Jacobin, you hit the nail on the head, regarding the dilemma youth face:
Perhaps I should have developed the great distrust I have for those in authority when I was 18, but I don't look upon my fellow generation with distaste, but mainly with compassion that they have been spoonfed the same bullshit I was.
Getting up to speed that the authorities are all professional liars and immaculate hypocrites, and facing the full consequences of what that means, is extremely difficult and disturbing. For most people, the longer it takes, the better off they are, because the paradoxical consequences of finally figuring out that the whole society surrounding you is based on huge lies, backed by violence, tends to be devastating.
My view is this: For decades I have been listening to various waves of people that I respected state that we were running out of time to fix the problems. First the warnings were we had to change within a decade or two, and then the warnings that we had to change within five years, then two years, or else, the runaway problems would become unfixable. WELL ... we have passed all of those deadlines, and the problems are now unfixable.
Crazy collapse to chaos, with an insane revolution being forced to happen, appear the only outcomes left. The runaway exponential growth of the money-as-debt system driving debt slavery through to debt insanity is easy to perceive, by its numbers, which are NUTS. However, those numbers are such astronomically sized INSANITIES, that it is impossible to imagine what is on the other size of the popping of this bubble, when that Ponzi scheme, pyramid system, of a house of cards built up and up, until it goes over the dark side moon, finally collapses.
Young people were adapting to their circumstances, which were the result of more than a Century of the greatest FRAUD there has ever yet been in human history. The radical truth breakthoughs regarding that must necessarily go as off the scale as the size of the original FRAUD that was perpetrated. For sure, the more you know, the worse it gets. ... It appears more likely that more people are finally going to be forced to face those facts!
I just hope the young people rise up and en masse and refuse to pay their loans or leave the US with no forwarding address.
My son is in grad school and I am appalled. Universities only educate incidentally. They are really businesses; sports teams, propaganda arms for bigfinance, research arms of bigpharma etc etc.
Most classes are taught by grad assistants. Kids hardly attend classes anymore.
And the tuition for this is highway robbery.
Pathetic, just like everything else in the US. No QUALITY anywhere to be found.
And that's why all the kidz voted for Obama
Not only is he not a rich white a55hole
But he will let them weasel out of their debts
If you really believe that, you haven't been paying attention. If I had to guess, I'd say we are going to see a new form of draft... one where your loans are forgiven for some period of service in our military... for the impending WW3. I wouldn't consider this weaseling out. Otherwise, the bankers control Obama, not the kids.
Barry Claus to the rescue!
Have these loans been synthesized into CDO's or any such thing? Is there an impending bankruptcy via some CDS's busting someone?
America's high-tech industry - "building a better pizza" - Just ask Papa John...
but who cares as long as they can eat like snobs?
http://www.salon.com/2010/03/16/hipsters_food_stamps_pinched/
MERRY CHRISTMAS YA FILTHY ANIMALS
This is it!!!!
I had a boss who once told me "the best time to borrow money is when you don't need to, and the best time to pay it back is when you don't have to". Does anyone know what that means?
"the best time to borrow money is when you don't need to, .........Your Credit is good you have lots of assets, you could fund an project yourself if you wanted to. You build up a relationship with a banker so in the future you can screw him on a really big project.........
and the best time to pay it back is when you don't have to" .........Your broke or they think your broke so they will agree to take whatever you throw at them cause they have no choice.
You Win!
They probably can't garnish wages until you make over $15k or so and based on that most college graduates are just fine. LMAO. Back to the drawing boards morons, no jobs bad jobs = no money. Of course this has nothing to do with that. Educators got rich. Who gives a fuck about anyones future.
Why are college costs exploding? Where are people getting the money to pay those huge tuitions? My suspicion is that student loans are largely to blame.
And with more people getting college degrees, jobs that formerly didn't require degrees are now being taken by college grads. One example is bank tellers. I know a recent college grad who was very lucky to get a bank teller position. He beat out several other college grads. But being a bank teller didn't require a college degree in the past. In fact, my mother worked as a part time as a teller to put herself through college.
Before the SLP, a high school grad with decent grades could go directly into a lot of decent jobs. Now a high school grad must attend college for several years, pay huge tuitions, and go deeply into debt in order to get the same job. The miracle of government!
FUCK THE VULNERABLE!
The most wicked humour is funny because it is true, and therefore, disturbing enough to laugh at. There is no doubt that, for those with a macabre sense of humour, the real situation is that the most vulnerable are being the most fucked, ... while, of course, statements about protecting them will become the excuses to fuck them over even worse!
You can't get the skills in government school these days to land a prestigious job like bank teller. That requires basic addition and subtraction math skills which the government can't squeeze into with just 12 years of indoctrination and other programming. Basic math skills would cost 10's of thousands of dollars more per student and we don't have the money for this. That type of curriculum requires a college degree in Amerika with an additional 90k in student loans.
Gonzo: Proof of your theory can be found at the nearest 7-11 with a 16 year old kid behind the counter. If your purchases come to $10.15 and you hand the kid a $20 and 15 cents you can hear the gears grinding to a halt in their head.
I used to live in Beirut, foreign exchange dealers there could convert money into mutiple currencies in their head!
You forgot to mention the phrase "to their advantage". Most people can't calculate math like that on-the-fly. I was in Singapore in 1983 with my older brother. We visited the Arab money changers in their own market. The fucking haggling over exchange rates took 30 minutes (still much better than the airport kiosk money changers). But seriously, we go out of our way to this money market and spend 30 minutes dicking around we better be changing some serious money to make it worthwhile. And we better spend that local money before we leave because we'll get raped on the exchange to convert it back to another fiat before we even get near the ariport.
Gold and Silver, Bitchez. Pack it in your carry-on. Fuck fiat, in any country.
I call bullshit on that one. Where I live, in NY - just outside of NYC, the workers at 7-11 are all on their way to doctorates and not only can do the math in their head, but know what you are about to purchase.
These are Indian guys, and ll really, really nice. They are here and fulfilling the American Dream. When I ask if they'll be relaxing this weekend, they tell me of 3 tests they have in the next week in grad school. They're not fucking around.
They (and I don't mean Indians - I mean immigrants and others willing to work 7 days a week) will inherit our country. It used to bet that our grandparents came here as blue-collar workers, their kids got fair mid-level management jobs, and their kids made it rich. Now, it's the opposite: our children aren't getting jobs, while these immigrants are getting whatever position they seek (Sikh - hahahaha), but they earned it and most of our kids have not. So, what are we complaining about?
We have to whip the shit out of ourselves and show our kids how hard we work. We are a disgrace. We watch and mock 'apoo' at 7-11, but I worked there as a teenager. It sucked and a lot of my jobs did when I was that age, but now I have no problem telling my co-workers to clean up, empty their garbage, put the garbage out, change the (fucking) roll in the toilet paper dispenser, etc. I go by the rule if I wouldn't do it I wouldn't ask my co-workers to do it. But, it's amazing what your average American is too good to do these days. Can you imagine a real estate agent who hasn't closed a deal in 9 months unwilling to dunp his or her trash in the common pail in the back of the office?
NOBODY WANTS TO WORK THESE DAYS. THE BEST ONE I'VE HEARD LATELY IS MY IVY-LEAGUE EDUCATED SISTER (UNDERGRAD AND MASTERS DEGREE HOLDING) TELLING ME THAT CHILD CARE SHOULD BE A RIGHT. MY GOD, MY SISTER IS SANDRA FLUCK.
EXTRA WINE - TO MANY DIGRESSIONS - SORRY!
I gave you a greenie for an excellent tirade. Oh, by the way, I used 7-11 as a traditional scapegoat/reference only. Should I have used Victoria's Secret employees as an example instead?
Yes, the world doesn't have to imagine anything about the US of Bailout these days. The world is waiting for the day that RE agent ends up sleeping next to the common trash pail in the back office. Maybe then you AID'ians will finally wake the fuck up (present company excepted dvfco).
The gvt owes $16 trillion already and you are worried about one extra little trillion? You must be kidding.
And don't worry, they'll spend another couple of trillions if things heat up in the Middle-East.
Yep, gotta send in American kids so that Israel's children don't have to get killed and maimed. It's simply unthinkable that we could lose any of those precious little angels.
I have numerous Elmer PhuD’s from elite universities that cover a wide range of knowledge.
U of Lagos, Nigeria (PhD): Communicationus Scamus.
U of Edinburgh (PhD): Sheepus Fuckitus.
U of Corzine (PhD): Cashus Disappearus.
U of The Bernank (PhD): Counterfitus Maximus.
U of Tungsten (PhD): Alchemist Extraordinarus.
Cost me less than $50 to get all those PhD’s. Staples has some excellent certificate paper that works well on every printer. I even bought the multi-pack of those gold stars and some cheap frames to hang them in. Makes them look really authentic, especially when you use a font that only an Archeologist can read.
The sad part is my fake degrees have actually fooled people who should know better simply because they look “authentic”.
And sadly, you learned more "creative thinking" in the process of devising your frauds than you would have learned in 8 years at any top university.
On the road to a 100% delinquency rate at which point the gov't will claim possession over all of your future earnings from that janitorial job you landed cleaning Jamie Dimon's feces out of his golden toilet bowl. If you are lucky you can sell your degrees to Mr. Dimon as toilet paper in exchange for a crisp new piece of paper with George Washington's face on it.
MISSION ACCOMPLISHED FUCKERS!
(Now the rest of you get to bail out Goldman Sachs and other fraud peddlers -- OH, you already did in the first Act)
MISSION ACCOMPLISHED [AGAIN] FUCKERS!
im still laughing at all the rich bastards we gunna soak in 2013 for taxes past due
.
let the kids take a good look, and then fucking pay
It's in the pressure cooker just like everything else. How easy we forget about the 676 TRILLION dollar derivitive ponzi. They need mere 900 billion dollar distractions like this to keep people from focusing on the truth... Smoke and mirrors
Student loans are the latest moneychangers trap. Student loans are not dischargable in bankruptcy and will accumulate interest until the the day the debtor dies. The moneychangers will garnish social security checks and get the balance of principal and interest the day you die. The taxpayer will be left to pay the debt. The ultimate scam.
Formula:
A = P(1 + r)n
Well intentioned student borrows $50,000 to get a degree and can't find a job. Student is 25 when interest starts to accumulate because interest is deferred until graduation.
Student can't get job and doesn't pay anything on loan until they start collecting social security at 67 1/2 years old.
Student dies at 85 years old.
A= $50,000 (1 + .05)* 60
A = $3,150,000
$3,150,000-$50,000=$3,100,000 ROI to moneychangers
62x ROI at taxpayer expense.
Yes?
Exactly, just like turning foreclosures into rentals all across America. This is what the bailouts got you... Totalitarianism
They can't dock your social security check for a foreclosure. If the student loan debtor doesn't pay before they are old enough to get SS benefits the moneychangers will get 25% of the debtors Social Security Benefits.
25% each. The predators know how to deal with this limitation, just like they dealt with home mortgage loans. They divide each loan into 4 loans, then each of the four creditors can dock 25% each... meaning, they dock 100%.
Nothing is difficult to those who create fiat, fake, fraud, fiction, fantasy, fractional-reserve debt out of thin air at zero cost to themselves. The "moneychangers" (as some call these predators) have understood these scams for hundreds if not thousands of years.
They also understand with complete clarity that anyone who can create fiat, fake, fraud, fiction, fantasy, fractional-reserve debt "money" out of thin air, can bribe any and every bunch of predators-DBA-government that has ever existed.
Until fiat ends, predatory slavery dominates. PERIOD.
honestann: Not sure why most people don't get it. I have to assume it's generational brainwashing. It's really quite simple. Keep using the slave masters fiat and you will always be a slave.
The Newfies have a saying: "If ya buy junk, ya always has junk".
I'm running off now to start my own printing press. I figure I'll print a TRILLION my first go around and see if I can't get the McHugebills into circulation shortly. Wish me luck.
Yep - Linda Green will re-emerge to create whatever fake documents are needed to make this happen. Some poor kid already overwhelmed with debt won't be able to fight it.
PRISNA of the BANKSTA... Please make a note of it.
I have to interject because you messed up on your math.
A=P(1+r)^n (raised to n not multiplied by n)
A=$933,959.29, interest earned is $883,959.29, ROI=1768%
I will recalculate using 6.8% (my college loan interest rate), a 59 year time period (diff between 18 and 77 because interest accumulation is not deferred and 77 is average American life expectancy), and $25000 (average college debt). I will also assume that $6250 in debt is acquired every year for four years at the end of each period.
A=$1,031,311.63, interest earned is $981,311.63, ROI=1963%
Thanks. My bad.
I don't think people know what they are getting themselves into when they borrow.
I am paying mine down. It is slow going. I've considered maxing out my credit cards and heloc, paying the loan off and declaring bankruptcy.
Why should the Banks get bailed while we get screwed?
Why would you pay off a debt that's bound to be forgiven? Defaulting seems the reasonable course of action. Don't be a sap and repay your debts.
The moneychangers are buying this debt hand over fist. This debt will never be forgiven. This is the the enslavement they have been awaiting.
THEY CAN GARNISH YOUR SOCIAL SECURITY BENEFITS.
I don't think you realize the implications.
The moneychangers will have access to entitlement payments. This is the motherload.
It will take a Constitutional amendment to stop this, new, form of slavery.
I'll bet Congress is buying up this debt. Why would they forgive this debt that will make them rich?
I call it the tread mill. My kids talk about going to UCLA? I tell them to look into an underwater welding program so you may have a future...Fortunately my kids get it and are getting over the UCLA thingy.
I'm realizing I would be an irish citizen - except for the fact that I never sent in my application. I have the right to be a citizen because of ancestry. My brother, who is an E.U. passport holder and Irish Citizen, explained to me how dopey we were growing up.
If we had applied for citizenship as children, we would have had citizenship and been eligible for a free college education. Instead, I worked my ass off to pay for the one semester abroad, coupled with the other 7 semesters done stateside.
My kids are now being taught that if they are so fast in track or swimming, they will get into school for free and the sky is the limit. Otherwise, the County College might be the limit in light of how rough our family has dealt with the downturn.
So, while my kids are running, I'll be working on citizenship and seeing if I can pass it on.
Should only get worst. 6 month deferment period for May graduates just ended. First round of pmts scheduled for December.
Victory Lap Bitchez!!!
Looks like an 'uptick' to me ... bullish /snark
Hell ya bitchez,
Get a slave for life for 30 cents on the dollar- never discharged. Be like those Chinese that bring sex workers into north America, you pay lady for smuggle tax, I keep your passport- debt paid off never, you think college degree grow on tree, keep shining knob.
Debtor prisons will bring back manufacturing to America- big time. And rock breaking, don't have to buy those chinese broken rocks anymore. White is the new black.
Made in the USA!!!!
I can fix this, ok here is the plan.
When the banks fail , dont bail them out again.
Then the students will be DEBT FREE!
It's a briliant plan, I know, no need to thank me.
If we did this with home-owners and the mega banks, we would of had 30 Million Home Owners renovating and improving homes creating jobs, but instead we opted to "save the banks" (don't ask me why on earth a group of people who are debt slaves to a bank would want to save their masters life, I guess people ARE THAT DUMB), instead of home improvement and job growth we got empty homes and high unemployement.... because we didn't take the opportunity to instantly de-leverage and boost the economy by letting the banks fail.... fucking retards.
Most of the students didn't get a viable education .... all they're good for is being social workers ! Maybe some of the brighter ones could be parole officers ? We are toast !
So how do you short this dog? Is there some ETF that tracks the default rate for these government funds?
Meh, fed loans, you just go on IBR and pay nothing. Private loans you just default entirely and settle in the end for nothing.
Meh, fed loans, you just go on IBR and pay nothing. Private loans you just default entirely and settle in the end for nothing.
IBR is maxed at 15% of your income. Makes it easier, but isn't "pay nothing" a bit of an exaggeration?
If politicians were competent, they wouldn't be politicians. If bankers had useful skills, they wouldn't be bankers. If lawyers were honest, they wouldn't be lawyers. In the US of A, the policy-makers are mostly politicians, bankers and lawyers. Now do you understand why we as a country, are fucked?
Well, maybe some students forgot to file tax returns?
I think at least some of these delinquences have to do with income based/contingent repayment options for one (these options are more likely with those with larger balances). They have to file tax returns every year and if they don't it resets to standard payment and they obviously cannot pay that and become delinquent.
Reduced payment options only mean the accumulation of more interest than originally anticipated. That is the plan.
Wall Street and its Educational Industrial Complicits have sorely miscalculated: they have taken their well tested methods of mass theft, which have been traditionally directed at the average American of average education, intelligence, and income, and attempted to extrapolate the process to the level of the well educated youth (college students with BA or better). What a fucking mistake...
It is one thing to sack the numb and hazy; it is entirely another to attack an army that can still outwit and outmaneuver you even after a 3-day rage at the Frat house, while laying in bed and taking another hit off of the bong. These college graduates (of all levels) are not going to go down, go away, or even begin to forget how Wall Street has fucked them: Instant Revolution: Just add nooses.
Looking forward to what happens next...
Sounds like a plan to me! We keep getting usurped by ows or the tea party etc. to divide and conquer the intellegensia.
We need to organize in a way to keep the Koch Brothers and their ilke from stealing the cause and turning on us.
I see "Bonus Marcher" being resurrected when poverty strikes those College boys and girls.
We need to outlaw political parties.
Why do so many of the posters assume that all of the defaulting debt is being carried by the "younger" generation? I know people who lost their jobs in 2008/9 and decided to go back to school to get MBA's, Masters, J.D. degrees etc. in hopes that by the time they graduated the economy would be better. It did not get better and they are saddled with a lot of debt and are now working jobs earning less than before they went back to get the MBA, etc.
I would imagine that a lot of that delinquent debt is in the hands of these types of people. Mid-career people with kids.
The debt is not held just by 24 year olds.
I don't believe so. Many of these in the "younger" generation spent the entire night & weekend spending money on 'door buster black friday deals". I am sure 'mid career people with kids' (many of whom likely actually PAY taxes) constantly wonder 'where do all these kids get the money' to shop whenever they want, eat out most nights during the week, $200 a week bar tabs, gym memberships etc.. Of course it is all credit based either on credit cards or student loans. Then we get these apologist comments like 'don't generalize' or 'not all of them are like this'. Well I am in my mid 30's but I have yet to see some who are not.
Because of the exponential growth of tuition since the beginning of the decade. Even people who are 30 (2005 grads) are probably carrying half to a third of the debt load and more than likely at a variable rate, which means they're paying Prime on their student loans. It's true that some of the cohort is from 2008 and 2009 post-grad. But it's more than likely 22-27 year olds who can't find jobs and can't pay the $20k-45k at the new fixed rate 7%.
Oh, and THANKS OBAMACARE!!! The bill had most of its projected "savings" in student loans that is never going to materialize. They wanted to "protect" students from the dangerous position of paying variable interest (tied to Prime Rates) and give them all fixed interest rates. Now, instead of paying Prime+, they're paying fixed 7. An exponentially greater amount in interest.
It's not scary,it the fraud it is.
To submit oneself to the brain-destroying predators who run modern colleges and universities is a fatal error. Observe for yourself. Think for yourself. Do this and forever remain utterly honest with yourself, and eventually you will have greater knowledge and insight than anyone in university.
Like no one saw THIS coming???? People who don't have income by way of stabile, decent-paying jobs don't make loan payments. It doesn't take an MBA to figure THAT out. DUH!!!!
Colleges and universities are good examples of inmates running the asylum. Academic intellectuals favor socialism and interventionism. These places are incubators for facist/socialist/communist thought. And this is only perpetuated and increased by increased funding from the welfare state. So isn't this really central planning at its core? Further indoctrination of our youth?
The meek have inherited the earth, and many will have college degrees on credit.
Now the friends and family of a student can get in on the action: http://live.wsj.com/video/before-you-sign-a-private-student-loan-primer/...!C09D7696-EEB8-4828-8853-D430024E7BB7
Looks like a bunch of 20-somethings with some potential, who might otherwise be buying houses and raising families, won't be doing either anytime soon.
No worries however, somebody will be having kids.
Idiocracy isn't a movie, it is an obituary.
And I used to think ZH was "home" to the economic rationalists, but no, still lots of bleeding hearts, socialists and big government apologists. Really....if something is " free", then take it to the max and use it to your own ends. Educate yourself to the max on government handouts, start out getting a nice corporate job, rack up the credit score and the credit cards and then boom......cash it all out and abandon ship. Education plus seed money......if you cant make a decent life for yourself with this starting point, then its your own fault. Forget the credit economy, its bad for you anyway. Go non-credit, underground, offshore, ....plenty of options, and I bet if you have the balls to even contemplate this strategy, you will, not only succeed , but be a lot happier than the indentured wage slaves.
( before you ask.........no.....way to late for this option.....but at least have this discussion with YOUR kids )
bet i max my down arrows on this post....lol ....see opening para above!!!!
oh no brotherman. see my post above. methinks we lament the same observations. well said.
Hold on just a frickin minute. Stop the presses. Pay attention all. His name was Robert Paulson.
SCARIEST? WTF. Since WHEN is fightclub AFRAID of JACK SHIT? And WHO voted on the acceptable use of SCARIEST in zh leading article title vocabulary?
When I first came to zh in 09, Tyler was the real deal, as was Project Mayhem. Today its like the mormon church, using JCs name only meanwhile perpetuating satanism. Todays Tyler is a replicant.
You wanna see a scary chart; lets quantify the number of comments in past weeks related to discontent regarding ZHz integrity relative to its original intent. Oh but dont be scared, be frightened.
Do us a favor and get lost.
ZH probably proved to be a lucrative venue.
So, doomsday forecasting became a thing to do because it's what people wanted; it's what brought in the $$$$. It's always the end of the world if the money's coming in. I sensed that a lot of that visceral anger in the agenda of ZH has gone by the wayside during my few years here.
here's my rant to add to all this discussion.
i am an economics professor, i taught at one of the UC campuses, and now i am back in Europe where i come from. one thing i can say after teaching at a UC - i would NOT send my kid there. classes are huge, professors are not very accessible, lots of work is dumped on teaching assistants, who are themselves learning by doing. this is caused by the "research ueber alles" attitude that the university has. when i was evaluated, guess how much space in the letter that went upstairs from my department was devoted to teaching? one fucking sentence, in what is a 1-2 page long single spaced letter. yes, that's it. promotion or merit increases could not be earned by excellent teaching - and you would not lose your job over lousy teaching either, unless you rape an undergrad.
i am not a macroeconomist, i do not teach Keynesian bs - in fact, i fail to understand just how the fuck they can teach this with straight face as a science. my contribution to making sure my students get something out of my classes they could use is that i try to teach them (a) how to work with data, including how to read the BS "statistics" we are fed; (b) i center my classes around the strategies businesses use - consulting i do definitely helps here.
How is it that you "fail to understand just how the fuck they can teach this with straight face as a science" when you yourself hold a freemasonic "degree" issued by the same disseminating gatekeepers of what we call "information" but which in reality is just memorized fabricated and redacted crap.
How do you know what you think you know? Be honest.
Do the math, its not rocket science.
here's what i know, believe in and teach: (a) people do constrained optimization, maximize their quality of life subject to budget and other constraints; (b) firms maximize profit, short-run or long-run, no matter what they say, they are trying to make money; (c) you cannot consume more than you produce; (d) if you think carefully, there is much more information behind the data than you can imagine. yes, i hold phd in economics, so what - i earned it, worked my way through it, have no student loan debt, cancelled all my credit card, this feels good.
"this feels good" - wow man, im sooo glad to hear that because at the end of the day i forgot to mention that this was all about you.
Ph.d: You earned it? Please define "earn". To me "earn" goes hand in hand with "integrity" and "respect"; both of which sprout from "honesty" which cannot exist in anyone's curriculum while reciting verbatim a bunch of memorized scripted crap to obtain a masonic pass, symbolized in a mortar on your head to represent the cementing process, to operate within their controlled environment. Really? you have a PhD and you havent figured THAT ONE out? Woah.
Id hate to wake up one day and realize I spent all that time and money, learning and repeating lies, in exchange for permission to have an income under strict controls by those who wrote the textbooks.
Once upon a time, if you could fix a truck, thats all that mattered.
In my case, I have had to analyze some pretty complex large dataset, found some new relationships in these data using fairly rigorous techniques. My follow-up work has impacted public policies in a certain sector of the economy in several countries, and helped bring more competition to certain markets.
You obviously know nothing about either Economics or Ph.D., so I will appreciate it if you could stick to commenting on the issues you do know something about, thank you.
you obviously are ignorant and i will comment about anything anytime anywhere. i dont care what you appreciate. oh but i forgot this is all about you.
How is it that you "fail to understand just how the fuck they can teach this with straight face as a science" when you yourself hold a freemasonic "degree" issued by the same disseminating gatekeepers of what we call "information" but which in reality is just memorized fabricated and redacted crap.
How do you know what you think you know? Be honest.
Do the math, its not rocket science.
According to your post you can't spell or punctuate either. Are you the Professor from Gilligan's Island?
I am not a Macroeconomist. Does this make my statement more credible, grammar Nazi?
"It's a damn poor mind that can think of only one way to spell a word!" -- Andrew Jackson
$10/hour is a big pay. people in china work for $10 a day
This is whay young people overwhelmingly voted for the clown. he will wash out the debt and they are too fuckin stupid to see the abysmal job he has done with this country.
Can't fix stupid with money.
Should anyone who does owe on these loans and is paying be in a hurry to finish paying it off? I think not, these loans will be "forgiven" and you'll be a chump.
The Fed will eventually buy these "assets" too, as the laundering bleaches the red out by packaging the assets as new derivatives called Forever Identured Slave Tranches (FIST). The Fist up ur ass securities will be worthless, but only in reality which counts not. The Fed will re-package them, in continuum, for future tax payors who won't recognize them; By that time, it will be called Society Hope Invigorating Trust fund, aka the Shit fund.
8 years of school down the drain and they still didn't get their degree in angry African lesbian studies with a minor in star wars culture psychology!
This topic is widely discussed, but what do you think the long term ramifications for this issue will be? Consumer confidence declines, across the board spending cuts, etc? Students realize that their brains are the one thing they own that can not be forclosed on.
So, all of America's newborn generations forthcoming will be born into indentured servitude of 'the state'.
NOTE OBAMA admin. has moved up the new student loan provisions to December 21st. Now requiring only 10% of your discretionary income to remain in compliance with your loan. Of course this was done to mittigate the parabolic default rate. TD please repost your article with thoughts.