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Federal Student Loans Surpass $1 Trillion; Delinquency Rate Soars To All Time High

Tyler Durden's picture




 

There is a reason why US consumer revolving (credit card) credit growth is getting lower and lower and lower and at last check posted a mere 0.2% annual increase.

That reason is that as the NY Fed disclosed moments ago, federal student loans officially crossed the $1 trillion level for the first time ever. Notably: the quarterly student loan balance has increased every quarter without fail for the past 10 years!

And just to prove that while credit card balances are plunging due to more stringent bank repayment requirements, this is more than offset by borrowers shifting to student loans, where the delinquency rate on student loans is soaring and has just hit an all time high of 11.83%, an increase of almost 1% compared to last quarter. Even according to just the government lax definition of delinquency, a whopping $120 billion in student loans will be discharged. Thank you Uncle Sam for your epically lax lending standards in a world in
which it is increasingly becoming probably that up to all of the loans will end up in deliquency.

Full report here

 

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Thu, 11/14/2013 - 14:31 | 4154925 Kickaha
Kickaha's picture

OK, I'll say it again. 

Make the institution sign as guarantor of the student before issuing any student loans.  Because it is the school, not the student, who ends up with the money, it is only fair for them to guarantee the loan.

There, a one trillion dollar problem solved, or, perhaps more accurately, a soon-to-be several trillion dollar problem held to one trillion.

 

Thu, 11/14/2013 - 14:34 | 4154936 Say What Again
Say What Again's picture

Want an education?   Take that money from your student loan and buy a bunch of SPY & QQQ.

Thu, 11/14/2013 - 14:35 | 4154944 tsx500
tsx500's picture

and BTC

 

Thu, 11/14/2013 - 14:43 | 4154951 Say What Again
Say What Again's picture

PCLN too

What can possibly go wrong

 

Thu, 11/14/2013 - 15:21 | 4155134 onewayticket2
onewayticket2's picture

not only is SoFi accelerating their demise, but individuals are now writing their own loans to get yield....but only on the best, most creditworthy students.

 

TIMMMMBERRRRRRRRRRRR

Thu, 11/14/2013 - 15:59 | 4155286 jbvtme
jbvtme's picture

go to edX.org and take courses from mit and harvard.  it's free.

Thu, 11/14/2013 - 19:14 | 4155868 Tijuana Donkey Show
Tijuana Donkey Show's picture

But corporate America holds out, they want debt serfs who need to make payments on degrees. People without debt quit or leave when things get shitty. 

Thu, 11/14/2013 - 19:36 | 4155942 The Alarmist
The Alarmist's picture

This is how leftist politicians reward their loyal supporters in academia with the help of the money of decent middle-of-the-road Americans like yourselves.  You, of course, are expected to feel good because you were only trying to achieve the best future for your offspring while you helped sell them into slavery.

Thu, 11/14/2013 - 21:56 | 4156378 bunzbunzbunz
bunzbunzbunz's picture

i would have been a billionaire... :(

Thu, 11/14/2013 - 14:34 | 4154937 tsx500
tsx500's picture

this is all part of the 'great recovery' , right ?     forward ?  

Thu, 11/14/2013 - 14:40 | 4154956 jcaz
jcaz's picture

You think the school winds up with this money?   What do you think has been powering consumers for the last five years? 

Ah, Serfdom- hope you kids enjoy your Ipads.....

Thu, 11/14/2013 - 14:45 | 4154974 Surging Chaos
Surging Chaos's picture

The schools are definitely the ones that end up with the money. How else can they pay for multi-million dollar athletic budgets, luxurious new buildings, and seven-figure salaries for bureaucrats?

Thu, 11/14/2013 - 16:32 | 4155395 ATM
ATM's picture

I was just commenting to someone that all the construction I have seen going on across the country is either some educational institution or a hospital.

These are your bubbles.

Thu, 11/14/2013 - 16:51 | 4155462 Troll Magnet
Troll Magnet's picture

And prisons.  Lots and lots of prisons.

Thu, 11/14/2013 - 16:55 | 4155475 shitco.in
shitco.in's picture

And a lot of these tax free bond funds are holding the bonds that were sold to build these dorms.  They are ALL over the place just waiting to implode.

Example:

https://www.nuveen.com/cef/Product/Holdings.aspx?fundcode=NRK

Thu, 11/14/2013 - 15:10 | 4155097 Kickaha
Kickaha's picture

As for the students themselves:

Once a student receives his federal student loan award, the U.S. Department of Education sends the money directly to his school. The school will then apply the funds to his account for the cost of tuition, room and board, school administration related fees and class activity fees, such as lab fees. If the loan funds arrive after the beginning of the semester, the financial aid office will issue him a book voucher or credit to buy books and deduct this amount from his student loan proceeds once they arrive. The school then refunds any remaining loan proceeds to the student. There are no restrictions as to how he spends the money refunded to him from his student loans.

Read more: http://www.ehow.com/info_8109751_do-student-loans-come-restrictions.html#ixzz2keFB0kTP

 

Parents can apply for and receive Plus loans supposedly to help them put their kids through college, and there are little, if any, restrictions on those suckers.  So, the student and the parent can conspire to get a Plus loan and live off of that, and the student apparently gets the leftovers from the school.  Rather than boring people with the details, let's just say the schools are fully taken care of by these programs, and sometimes the kids and their parents, too.

The program "powers" the universities and makes the current expense bubble in college costs inevitable.

Fri, 11/15/2013 - 00:21 | 4156762 MopWater
MopWater's picture

Thats the exact situation my wife is in.  Took out loans to pay for education, took extra for the "disbursment" and lived on loans for 4 years or so.  That idea was common place and was actually promoted by the schools and their "financial advisors".

I cant tell you how many kids used that extra cash to go on spring break trips, buy gadgets, or just party...im only a few years removed so it couldnt have changed much.

Thu, 11/14/2013 - 15:08 | 4155083 BlueCheeseBandit
BlueCheeseBandit's picture

Totally agree that the schools should be on the hook for this money. They're the only ones benefitting from this system. Odious debt.

But the head nigger in charge won't reform this system unless it collapses on his watch. He's too busy picking the cotton for his Massas: fat old bitches with crusty cunts and no skills milking the education scam for all it's worth, kids be damned.

Thu, 11/14/2013 - 19:32 | 4155932 CH1
CH1's picture

Take the skin color shit elsewhere.

Thu, 11/14/2013 - 21:55 | 4156376 acetinker
acetinker's picture

Agree, but the particular kneegrow referenced is a pox on free humanity.

Thu, 11/14/2013 - 15:25 | 4155150 rubiconsolutions
rubiconsolutions's picture

We've had the ACA (Affordable Care Act), maybe it's time for the SNAFU (Students Not Actually Fucking Us) to get them off the taxpayers teat.

Thu, 11/14/2013 - 15:36 | 4155182 HardAssets
HardAssets's picture

Sue the institutions for breach of contract for the loan sums. They were supposed to provide an education, turned out tons of naive dummies - so obviously education wasn't provided.

Thu, 11/14/2013 - 16:52 | 4155463 libertus
libertus's picture

Nothing says collapse like numbers that large. Check our Oplerno.com they have a good model that lowers cost and actually creates an incentive to pay teachers more while lowering the cost. Its called a marketplace...

This is not going to end well for traditional higher education. It is over for all those tenured professors and high paid administrators. 

Thu, 11/14/2013 - 20:31 | 4156102 Ghostdog
Ghostdog's picture

Love the idea! Too bad the University dildo's wont

Fri, 11/15/2013 - 09:42 | 4157348 papaclop
papaclop's picture

Why does dildos get an apostrophe?

Thu, 11/14/2013 - 14:32 | 4154927 Lin S
Lin S's picture

Student loan bailouts will be next and unemployable Art History majors will cheer for the Emperor who thinks it up.

Thu, 11/14/2013 - 14:49 | 4154998 Groundhog Day
Groundhog Day's picture

My young naive cousin attends Seton Hall.  She gets a new laptop every two years and she thinks it's free. 

Thu, 11/14/2013 - 15:04 | 4155069 Lin S
Lin S's picture

Wow... just wow.  I wonder how many more like her are out there...  = (

Thu, 11/14/2013 - 23:13 | 4156587 jerry_theking_lawler
jerry_theking_lawler's picture

all of them

Thu, 11/14/2013 - 16:10 | 4155218 HardAssets
HardAssets's picture

I heard of a kid who uses his student loan money to buy $1500 ukuleles. One of them needed some work done on it, so he sent it to the maker. He bought another one to play around with while the first one was in the shop for a couple weeks. (He is not a professional muscian using the instrument to make a living in any way. )  After he got the first one back from the shop, he sold the 'spare' for $750 - - - a 50% loss in two weeks.

Wanna bet that the taxpayer will be somehow hit with at least part of the bill on that $1Trillion of loans ?  The banks never take the hit.

Thu, 11/14/2013 - 16:56 | 4155466 Troll Magnet
Troll Magnet's picture

Yeah but ukulele is a human right.

Thu, 11/14/2013 - 19:47 | 4155966 americanreality
americanreality's picture

Every two years?  How long has she been in school?  Sounds made up. 

Thu, 11/14/2013 - 15:08 | 4155070 Josey Whales
Josey Whales's picture

I have to admit, I'm part of that 11% default rate. Am I proud of it? No. Am I proud I got an overpriced Politcal Science degree? Not at all. Did I know any better as a fresh 18 year old teenager--lead and funneled to college to "further my prospective future?" No, I had no idea.

This is the most dangerous type of loan--overambitious teenagers ready to flee the nest and start fresh on their vision of the life--filled with nonsensical ambitions like "I'll graduate college and get a job as a "x" getting paid $xxx,xxx/year."  Hey kid, don't have money? That's okay, just sign here. Here hits the climax of the story--We witness the dreams of the college graduate sink down the pisser as the only available work for the carbon copy college graduate is as a barista at Starbucks, whipping up Pumpkin Spice lattes to sorority girls sporting 3XL frat shirts and yoga pants tucked into Ugg boots.

Reminds me of that terrible Nicholas cage movie "Ghost Rider". The devil tells Cage--"Just sign here" (Cage cuts his finger and a drop of blood hits the dotted line). "Oh, that'll do just fine".

Thu, 11/14/2013 - 15:32 | 4155175 Alpha Monkey
Alpha Monkey's picture

This is pretty much the same reason I'm against recruiting for the military in High Schools and Colleges.  Personally, I think it is equally criminal sign up youngins to "defend the country".

Thu, 11/14/2013 - 16:21 | 4155358 Josey Whales
Josey Whales's picture

Thank God I didn't follow that route--"Use your vigor and your young, narrowminded attraction to violence to defend yer country against dem people who hate us for our FREEDUMZ!"

Sadly enough though, I thought I wanted to graduate college to become an officer to "sacrafice for my country". How shitty would that have been? Got to college, get in debt, serve your country, die/become injured/obtain PTSD? I would have been the poster boy for the state.

Thu, 11/14/2013 - 15:35 | 4155179 codecode
codecode's picture

So, what actually happens when one defaults on a student loan? I know bankruptcy is not an option... Does the IRS come a knockin? Or do you just keep getting statements from the government the rest of your life?

Thu, 11/14/2013 - 16:02 | 4155301 Kickaha
Kickaha's picture

They officially default you, then you get stern letters and dunning calls, then you get suggestions as to how you can apply for various abatement programs (i.e - payments are suspended or lowered and you fall into negative amoritization), then the file is turned over to a collection agent, and eventually they have the right to sue your ass.  There is no defense, so they obtain a Judgment. After that, they can use Court writs to seize your assets and garnish your wages.

If you have a thick skin, no assets, and no job, you've got nothing to worry about, at least with regard to your student loan debt.

If the loan is federally guaranteed, they will seize your Social Security benefits, but if you are under 40 right now, you probably won't have to worry about that, either.

Thu, 11/14/2013 - 17:00 | 4155481 MachoMan
MachoMan's picture

A landmine for families moving forward...  one spouse has debt, the other doesn't...  have to separate all their assets and use impractical maneuvers to avoid creditors...

Thu, 11/14/2013 - 18:49 | 4155785 Edelweiss
Edelweiss's picture

I see that sort of situation on a regular basis at work.  One woman I know is about to marry a guy with a newly acquired PHd in chemistry, and 100k in debt.  Did I mention he makes $10/hr as a part-time worker, and is unable to find a job in his chosen (teaching) area?  Bright enough to earn a PHd, but too dumb to realize paying off that kind of debt is a monumental task when also trying to start a family, buy a house, etc. 

Thu, 11/14/2013 - 19:21 | 4155895 Tijuana Donkey Show
Tijuana Donkey Show's picture

Two words. Breaking Bad

Thu, 11/14/2013 - 23:16 | 4156594 jerry_theking_lawler
jerry_theking_lawler's picture

another word. tell the woman to get wise. find another lover with no debt and $10/hr job.

Thu, 11/14/2013 - 17:09 | 4155533 codecode
codecode's picture

Serious stuff... tough future for those involved

Thu, 11/14/2013 - 15:39 | 4155195 NOTaREALmerican
NOTaREALmerican's picture

Re:  overambitious teenagers ready to flee the nest and start fresh on their vision of the life

Adults screwing the children.   The adults kill the children in the sand box for oil,  get them into debt, demand they pay for the OldFart's free Medicare Motorscooters, & fill them with bullshit that all the children are above average.

Of course, each generation matures into adults doing the same thing.   Interesting society we have here.   

Thu, 11/14/2013 - 16:24 | 4155376 JuliaS
JuliaS's picture

Our old geezers are gonna compete with foreign geezers over the dwindling supplies of diapers and dentures. There'll be wars over this shit and who's better to send defending the turf than the young crop of indebted volunteers armed to the teeth with hi-tech gadgets.

Thu, 11/14/2013 - 16:01 | 4155293 RockyRacoon
RockyRacoon's picture

Politcal Science

We presume that you learned the definition of "oxymoron" while in attendance at your educational institution?

Thu, 11/14/2013 - 16:11 | 4155321 Josey Whales
Josey Whales's picture

Actually, I learned how to chug a beer and socialize--none of which should have cost me 18k in the hole. But yes, I see how "politcal" and "science" can be interpreted as a oxymoron

Thu, 11/14/2013 - 16:25 | 4155372 HardAssets
HardAssets's picture

Josey Whales - Well what gets to me is how freakin' clueless parents seem to be. Its understandable that many 18 year old kids have no idea what end is up . . . but their parents seem to be in the same boat. No guidance of their kids in terms of the options out there for them ?  A relative's kid will graduate from h.s. and wants to go into the medical field. Really ?  Ever heard of obummer 'care' ?  Are they aware that experienced docs are leaving the field because of the nightmares they see coming ?  Are they aware that they WILL need to get BIG loans if the kid makes it into medical or dental school ? (The odds are very slim for that)  Do they know that a pre-med (typically biology based) undergrad degree is worth very little ?

I guess kids need a 'tell it like it is uncle' to tell them when their head is stuck up their backside. The parents seem to be stuck in 'positive thinking' kum-baya mode, or something.

Thu, 11/14/2013 - 16:38 | 4155419 Josey Whales
Josey Whales's picture

@Hard assets--I agree. The flip side is my generation is starting to wake up. College enrollment is steadily decreasing, and college institutions are wrongly diagnosing the problem to "marketing failures". Hardly. People are just realizing "why the hell should I spend a lifetime of debt for a degree that will more than likely not even get me a job even related to my field?"

i like Schiff's take on the situation. his advice--graduate HS, live with your parents for 4 years and offer your services to a company of your chosing. Tell them "I'm willing to work for you at minimum wage and become trianed for over the years for x job." Within 4 years it would have taken the most studious of college grads to graduate, you've gained applicable skills, you've avoided copious amounts of debt, you've saved money by not paying rent, and saved cash from your job-- all the while possibly climbing the ladder. Within 4 years, you can have skills outmatched the college grad they can't compete with.

That's one alternative. Another? travel the world. Start up a makeshift business. Fail. Succeed. Do shit other college kids do--without going to college. We act like college is the only option, and it isn't.

Thu, 11/14/2013 - 16:53 | 4155454 HardAssets
HardAssets's picture

Josey Whales:  The worst part of it is that you just about cannot get a real classical liberal education in the 'schools' today. They are places for dumbing people down and indoctrination. A classsical education used to be common across America, but is only taught in private prep schools attended by the children of the so-called 'elites' today. Such an education includes the tools for learning how to learn which are part of the Trivium and include General Grammar (English grammar is only a small sub-set of that), Logic, and Rhetoric. Even those going into technical specialites only apply critical thinking skills to their narrow vocational specialties. So, its very common to find doctors, engineers, and scientists who are as dumb about the world as the general population, and easily fooled by propaganda. (Such as obummer voters in high tech industry regions.)

And the thing is, this classical education can be had by anyone who puts in the effort for themselves. You can do it on your own for little (or no) money.

If a kid & his parents spend big bucks today, they should insure that it will enable tihe kid to make a living and become independent.  Real education is an entirely different thing that you do for yourself over a lifetiime.

Best regards to you

Thu, 11/14/2013 - 17:22 | 4155568 scrappy
scrappy's picture

I am very glad you mentioned the Trivium.

http://www.triviumeducation.com/

The Quadrivium

http://www.triviumeducation.com/quadrivium-2/

[4] Arithmetic, [5] Geometry, [6] Music, and [7] Astronomy.

The Quadrivium (which pertains to Matter & Quantity)- the advanced four.

[4] ARITHMETIC —
Number in itself, which is a pure abstraction; that is, outside of space and time.

[5] GEOMETRY —
Number in space.

[6] MUSIC OR HARMONIC THEORY —
Number in time.

[7] ASTRONOMY —
Number in space and time.
a. Number
b. Geometry
c. Harmonics
d. Cosmology

Here are some books on my wish list ...

The Trivium

http://www.amazon.com/gp/product/0967967503/ref=ox_sc_sfl_title_2?ie=UTF...

The Quadrivium

http://www.amazon.com/gp/product/0802778135/ref=ox_sc_sfl_title_10?ie=UT...

Sciencia: Mathematics, Physics, Chemistry, Biology, and Astronomy for All

http://www.amazon.com/gp/product/0802778992/ref=ox_sc_sfl_title_1?ie=UTF...

Sacred Geometry

http://www.amazon.com/gp/product/1402765827/ref=ox_sc_sfl_title_9?ie=UTF...

 

 

Thu, 11/14/2013 - 20:37 | 4156125 HardAssets
HardAssets's picture

scrappy - yep, good stuff. I know that Trivium website.

 

For those who haven't already seen this - here's the whole story of why & how education was purposely dumbed downed in the U.S.  You can read the entire Underground History of American Education by John Taylor Gatto for free at this website. If you haven't yet read this it will blow your mind:

www.johntaylorgatto.com/chapters

 

Charlotte Iserbyt has also done work on this and has her book The Deliberate Dumbing Down of America

Gatto and Isberbyt can be found giving various audio and video interviews if you websearch their names.

Thu, 11/14/2013 - 19:23 | 4155903 Tijuana Donkey Show
Tijuana Donkey Show's picture

@HardAssets "doctors, engineers, and scientists who are as dumb about the world as the general population, and easily fooled by propaganda" Uhhhhhh, can you say big phama anyone?

Thu, 11/14/2013 - 20:42 | 4156090 HardAssets
HardAssets's picture

I know a good kid who decided to go on to grad school in micro-biology and gene research.  I'm not qualified to  evaluate or comment on the specifics, (did engineering at the undergrad level, finance later beyond that), but anything in that field that is financed and occurs at a major state university draws my suspicion. His fiancee is also a good kid. Undergrad degree in finance and going to work for one of the big money center banks as her first job. (Asked her a few questions about the general financial situation in the US and the world and its obvious they don't teach them squat in state universities. She's an A student. Never heard the term 'Austrian economics'.)  --- How do you bring up to young college graduates in light conversation "Well, did you know - its probably better working for the Mafia, they're not quite as destructive."  ?

Thu, 11/14/2013 - 16:34 | 4155401 ATM
ATM's picture

It won't be student loan bailouts It iwll be student loan investor bailouts. All those student loan CDO losses will be backstopped by the public or haven't you learned anything?

Thu, 11/14/2013 - 14:32 | 4154929 firstdivision
firstdivision's picture

Until they start letting bad debt go bad, jobs will never return and student debt will keep inflating unsustainably.

Thu, 11/14/2013 - 14:33 | 4154935 Lin S
Lin S's picture

How can jobs ever return without first leaving China?

Thu, 11/14/2013 - 14:41 | 4154960 Say What Again
Say What Again's picture

Is this a trick question.

Are you trying to flush out those wacky tea-bag republicans with strong opinions?

Thu, 11/14/2013 - 17:14 | 4155545 yogibear
yogibear's picture

The Fed is trying to do that by devaluing the US dollar. When those in US the make less than in China ( In cheaper US dollars) then they'll know they were successful.

Thu, 11/14/2013 - 14:52 | 4155013 Groundhog Day
Groundhog Day's picture

Hence the road to serfdom.....according to plan.  When they can't pay, you and i will bail them out but the government gets to hound them until they die or pay it back.  It's a beautiful plan for world dominition!

Pinky and the brain

Thu, 11/14/2013 - 16:36 | 4155406 HardAssets
HardAssets's picture

Its all 'bad debt'.

These f*kers stole 98% of peoples earnings & savings for a century through inflation of the currency. They then taxed and interest rate raped what was left of that paltry sum. They hit up the taxpayers for bailouts on their bad derivative gambling debts (too big to fail), reamed many homeowners by foreclosing on houses they didn't own paper on, and charge mafia interest rates on credit cards.

What they 'loaned' was fabricated from nothing with a few keystrokes out of thin air.

Henry Ford said : " If people understood how money and the banking system worked, there would be a revolution before morning."

Thu, 11/14/2013 - 14:33 | 4154933 q99x2
q99x2's picture

Student's have a moral obligation not to pay bank debt. They know that is the best way to fight financial terrorism.

Thu, 11/14/2013 - 14:42 | 4154965 Say What Again
Say What Again's picture

"Student's have a moral obligation"

Its been a while since you walked around a college campuss.

 

Thu, 11/14/2013 - 16:02 | 4155300 RockyRacoon
RockyRacoon's picture

True.  If morals had been an issue the students wouldn't owe that debt in the first place.

Thu, 11/14/2013 - 17:19 | 4155561 yogibear
yogibear's picture

What do kid know at 18? The high schools are even pushing college. The "College experience".

Built on lies and assumptions.

They just dump the debt on the kids.

Thu, 11/14/2013 - 17:09 | 4155527 MachoMan
MachoMan's picture

Debtors have a duty to honor their promise to repay, especially when they receive the benefit of their bargain.  Now, it may turn out that what they got wasn't as valuable as they expected, but that's just sour grapes.  Now, if you were recruited by fraud...  then maybe you have an argument...  but I think you'd be the exception rather than the rule...  the rule is that college is an awesome oasis once you turn into a legal adult where you get to drag your dick through plenty of things...  do drugs...  and figure out how long you can possibly go without washing your sheets or how long leftovers last in the refrigerator.  Once the bill comes due for the vacation, people lash out at everyone but themselves....

Moral obligation is really, really tricky here.

Thu, 11/14/2013 - 14:34 | 4154938 toe
toe's picture

yellen 2014 "never saw that coming" 

Thu, 11/14/2013 - 14:55 | 4155035 Groundhog Day
Groundhog Day's picture

After listening to her speak for the first time, i can see why she was hand picked.  She is to slow and stupid to know whats going on around her and perhaps it will be hard to roll out the guillotines when she says i didn;t see this coming

Thu, 11/14/2013 - 16:04 | 4155305 RockyRacoon
RockyRacoon's picture

A dollar for each sentence begun with, "So....", would go a long way toward retiring the national debt.

Sounds like a college sophomore.  Just add a slight valley-girl inflection.

Thu, 11/14/2013 - 16:37 | 4155414 ATM
ATM's picture

So.....When the hell did that start? So.... I missed it but now cannot stand it. WTF? Did they all get tired of saying "like" 6 times every sentence?

 

Thu, 11/14/2013 - 14:34 | 4154941 EscapeKey
EscapeKey's picture

Bullish. More prospective employees for Corrections Corp of America.

Thu, 11/14/2013 - 14:35 | 4154943 orangegeek
orangegeek's picture

Too funny. 

 

Walmart reported shit results and the stock is up 0.4%.

 

Dow is up, S&P is up.

 

Who gives a fuck about debt - keep piliing it up!!!!!

Thu, 11/14/2013 - 14:41 | 4154962 RaceToTheBottom
RaceToTheBottom's picture

Debt is virtually Profits!!!!

Thu, 11/14/2013 - 15:48 | 4155236 Bunga Bunga
Bunga Bunga's picture

Nothing can fuck up this murket anymore.

Thu, 11/14/2013 - 16:38 | 4155420 ATM
ATM's picture

It's bizarro market. Bad is good and good is bad. It all goes to the Fed actions. Anything that causes them to print even moar is good and anything that looks like they can slow is very, very bad.

Thu, 11/14/2013 - 14:41 | 4154950 hedgeless_horseman
hedgeless_horseman's picture

 

 

We cannot say we have not been clearly warned...

 

 Exodus 22:25

“If you lend money to any of my people with you who is poor, you shall not be like a moneylender to him, and you shall not exact interest from him.

 Deuteronomy 23:19

“You shall not charge interest on loans to your brother, interest on money, interest on food, interest on anything that is lent for interest.

 Ezekiel 18:8

Does not lend at interest or take any profit, withholds his hand from injustice, executes true justice between man and man,

 Ezekiel 18:13

Lends at interest, and takes profit; shall he then live? He shall not live. He has done all these abominations; he shall surely die; his blood shall be upon himself.

 Leviticus 25:37

You shall not lend him your money at interest, nor give him your food for profit.

 Luke 6:35

But love your enemies, and do good, and lend, expecting nothing in return, and your reward will be great, and you will be sons of the Most High, for he is kind to the ungrateful and the evil.

 Proverbs 22:7

The rich rules over the poor, and the borrower is the slave of the lender.

 Proverbs 28:8

Whoever multiplies his wealth by interest and profit gathers it for him who is generous to the poor.

Thu, 11/14/2013 - 14:45 | 4154975 john39
john39's picture

look at the world today for all the proof you need of the wisdom contained therein.

Thu, 11/14/2013 - 15:02 | 4155060 madcows
madcows's picture

I told my neighbor lady next door to put her head out the window and get a refill.

Wisdom is inversley proportional to fat, and we've got a lot of fat here in merica.

Thu, 11/14/2013 - 14:48 | 4154988 Say What Again
Say What Again's picture

Jammie D  1:01

"That's why I'm richer than you."

Thu, 11/14/2013 - 14:48 | 4154990 eclectic syncretist
eclectic syncretist's picture

We were warned, we just didn't learn. SOS.

Thu, 11/14/2013 - 14:52 | 4155017 NOTaREALmerican
NOTaREALmerican's picture

Just another turbine wearin' Muslim who hate Merica, and the troops.

Thu, 11/14/2013 - 15:06 | 4155077 forwardho
forwardho's picture

How did our culture come to forget that which was known to be true 2000+ years ago?

Thu, 11/14/2013 - 15:14 | 4155105 hedgeless_horseman
hedgeless_horseman's picture

 

 

I have not forgotten.

You have not forgotten.

John39 has not forgotten.

There are others, too.

Thu, 11/14/2013 - 19:35 | 4155936 Tijuana Donkey Show
Tijuana Donkey Show's picture

I'm confused? Didn't the "Chosen ones" write and follow the Old Testament? Am I missing something here?

Thu, 11/14/2013 - 15:25 | 4155149 Alpha Monkey
Alpha Monkey's picture

Because somehow regulating peoples sexual habits, building grandiose temples, and proselytizing became more important that the actual teachings of the wisdom... 

I have a suspicion it has something to do with money....

Thu, 11/14/2013 - 16:51 | 4155461 WOAR
WOAR's picture

Indeed. It's never the idea that's wrong, it's how people implement it. Communism would work, if you weren't forced into it and volunteered instead. Capitalism would work, if people didn't steal and cheat. Religion would work, if people weren't God damned lunatics who lose sight of the forest for the trees.

Thu, 11/14/2013 - 15:30 | 4155167 NOTaREALmerican
NOTaREALmerican's picture

Re:  How did our culture come

It's been a scam based world forever.   Being an atheist I have no illusions about the Bible being "influenced" by the guy-in-the-sky, but there's obviously lots of wisdom written down in there.    You'd think that some of first people to figure out how to write would have taken the time to put some useful information in there (still amazing they left out the dinosaurs tho..)

(But anyway…) regardless, the sociopaths are simply higher evolved humans.  People complete by creating bullshit used to manipulate the lessor evolved dumbasses.   Even if the bible had step-by-step guidelines for identifying and killing sociopaths it wouldn’t help because the sociopaths would create bullshit showing the guidelines were incorrect AND the dumbasses would believe them.  

The only way to keep the sociopaths from eating the dumbasses alive is by keeping the sociopaths fighting with each other or having a strong nearby enemy causing the sociopaths to need the dumbasses as protection from the enemy.    The US has neither condition.

Thu, 11/14/2013 - 17:20 | 4155554 MachoMan
MachoMan's picture

In order to keep the power hungry at bay (I don't use the word sociopath because it requires a proper diagnosis and only applies to an incredibly small amount of the population, despite changing the criteria to fit a broader range) the plebs must ALWAYS play with fire...  there has to be enough of an agreement, born from collective bargaining, to keep the plebs heads above water.  However, that agreement must be enforced both by collective vigilence AND by watchmen.  The problem, of course, is who watches the watchmen?  Inevitably, the regulator becomes corrupted...  and the agreement eventually broken...  sparking another period of collective bargaining.  And so the cycle goes.

In short, the institution we require to protect our agreement must be large enough to keep the power hungry at bay, but at the same time limited enough not to consume us...  it's a tight rope humans can never walk for very long.

Thu, 11/14/2013 - 15:52 | 4155255 Radical Marijuana
Radical Marijuana's picture

Back at you with more classic Biblical Bullshit, hedgeless-horseman:

"The love of money is the root of all evil"

--- (1 Timothy 6:10);

“The stranger that is within thee shall get up above thee very high; and thou shall come down very low. He shall lend to thee, and thou shall not lend to him; he shall be the head, and thou shall be the tail”

--- Deut. 28:44-45;

“It's the same fatal bite of that old Serpent the Devil and Satan which deceiveth the whole World”

--- Rev. 12:9;

Usury (in the original sense of any interest) is scripturally and doctrinally forbidden in many religions. The word Usury in Hebrew is "nesek" and it means “BITING” as from a serpent.

Judaism forbade a Jew to lend at interest to another Jew. While Jewish law forbids the charging of interest to another Jew, Jews were not forbidden to charge interest on transactions to non-Jews. Throughout history, the interest attached to loans by Jews to non-Jews is widely considered to have been a central issue in causing a perception of usury, and contributing to a climate of anti-Semitism. Allegations of usury have been one factor leading to forceful confiscations of property and discrimination against Jews in business practice.

The most recent Catholic teaching on usury is by Pope Benedict XIV in his Vix Pervenit from 1745 which strictly forbids the practice, though given the modern day Catholic Church's own bank and investments in the banking industry, the prohibition has to be regarded as a dead letter:

http://revisionistreview.blogspot.ca/2013/01/youtube-michael-hoffman-talks-about.html

Historian Michael Hoffman gives a talk concerning his thesis "Usury in Christendom: The Mortal Sin that Was and Now is Not."

... Another Crazy Christian presenting interesting history regarding the Catholic Church and the monetary system. However, his "solutions" appear to me as extreme forms of the false fundamental dichotomy dogmas.

(Meanwhile, that usury is still actively forbidden by those who believe in the Islamic faith is the main reason why there is an increasing clash of cultures, with the false flag started war on terror developed to drive those geopolitical events.)

Young people in America are BORN INTO A DEBT SLAVERY SYSTEM, which has crossed the threshold into obvious DEBT INSANITY DURING THEIR LIFE TIME. A few of them may inherit significant wealth, but the vast majority are terminally screwed by the system around them, far worse than most of them are able to comprehend. The history of that happening was the history of the Anglo-American (Zionist) empire's rise, and apparent fall, as I plagiarize in several different passages repeated below:

England’s King Edward VI (1547-1553) outlawed usury by Parliamentary decree. His reign was cut short because he opposed the moneylenders. Later King James was murdered and King Charles I was beheaded and finally, the private Bank of England was chartered in 1694. After the Battle of Waterloo, the Rothschilds managed to take ownership of the Bank of England from its former private owners. After 1913 the international bankers were able to recapture control over the American government, and have been consolidating that control ever since. Student loans now manifest as the most morally offensive of the results of that process, whereby the methods of organized crime were able to take over control of the public money supply to benefit private interests. As G. Edward Griffin summarized the situation regarding the Fed: it is a cartel operating against the public interest, as the supreme instrument of American usury, with the IRS acting as the collector. It generates unfair taxes through inflation and bail outs, it encourages war, it deliberately destabilizes the economy, it discourages private capital formation, and it cannot be fully audited. THAT SYSTEM IS WHAT AMERICAN YOUTH ARE BORN INTO!

Under today’s usury system, new debt always exceeds the new money no matter how much or how little is borrowed, the total debt increasingly outstrips the amount of money available to pay the debt. The people can never, ever get out of debt! THE ONLY WAY TO GET AHEAD INDIVIDUALLY IS TO GO DEEPER INTO DEBT, WHICH IS WHAT INDIVIDUAL YOUNG AMERICANS "DECIDE" TO DO, ALTHOUGH VERY FEW OF THEM UNDERSTAND THE BIGGER PICTURE. Since they are stuck inside a monetary system that allows a tiny private sector clique to control everything (business, government, military, non-profits, schools, families, etc.) by putting everyone else in debt, we have been living in financial dictatorship for a long time. Previously, that has been a relatively soft dictatorship, operating through public relations shows, however, it is getting ready to transform into a democidal martial law dictatorship. Not only can the money powers steal trillions from the masses to hand over to themselves, but they can suck the military into conquering poor countries that are not subject to their usury vortex system, build Homeland Security to spy on Americans, and have the CIA assassinate US citizens. There is no question that full-blown fascism is planned for the supposed land of the free as the globalized ruling classes try to move Americans into the banksters' consolidated global system.

FOR THE VAST MAJORITY OF YOUNG PEOPLE IN AMERICAN TODAY, THE CONSEQUENCES OF THE PAST ARE RUSHING FASTER TOWARDS DESTROYING THEIR FUTURE. Following the saying that AS ABOVE, SO BELOW & AS WITHIN, SO WITHOUT, everything that the Anglo-American (Zionist) empire has been doing all over the world to other people is now being more and more done, OR WILL BE DONE, to young Americans:

Parasitism, practised through taxation and usury, involved a constantly increasing centralisation of the instruments of government, and a growing strain upon this government, as the prey became more impoverished by the drain and showed signs of restiveness. The evolution of this centralised society was as logical as every other work of nature. When force reached the stage where it expressed itself exclusively through money the governing class ceased to be chosen because they were valiant or eloquent, artistic, learned or devout, and were selected solely because they had the faculty of acquiring and keeping wealth. American history has repeated, faster than any previous, the process whereby the original top carnivores degenerated into become parasites, as they became too successful at turning their prey into Zombie Sheeple, and their controlled opposition of Black Sheep, who are various kinds of reactionary revolutionaries, who do good analysis of the problems, but then end by proposing their preferred "solutions" of going backwards to some old-fashioned religions or ideologies, which are all based on versions of assertions that everyone should become better Sheeple.

This is the largest, plainest instance history presents of the social parasitic process by which a moneyed interest within the State, usurping the reins of government, makes for imperial expansion in order to fasten economic suckers into foreign bodies so as to drain them of their wealth in order to support domestic luxury, which then eventually spirals back home, to do similar things there, in a repeating toroidal loop. The elements of political tribute is now absent or quite subsidiary, and the crudest forms of slavery have disappeared. Some elements of more genuine and disinterested government serve to qualify and mask the distinctively parasitic nature, but nature is not mocked: the laws which, operative throughout nature, doom the parasite to atrophy, decay, and final extinction, are not evaded by nations any more than by individual organisms. In the greater complexity of the postmodern processes, the endeavour to escape the parasitic reaction by rendering some real but quite unequal and inadequate services to "the host," may retard but cannot finally avert the natural consequences of this degeneration due to the fundamental nature of triumphant "success" of these kinds of force backed frauds.

Effectively Privatized Imperialism is a depraved choice of national life, imposed by self-seeking interests which appeal to the lusts of quantitative acquisitiveness and of forceful domination surviving in a nation from early centuries of animal struggle for existence. Its adoption as a policy implies a deliberate renunciation of that cultivation of the higher inner qualities which for a nation as for an individual constitutes the ascendency of reason over brute impulse. It is the besetting sin of all successful States ...

As the saying goes, "The fish rots from the head down." America has been systematically destroyed by the international bankers, and the widespread rot throughout the system now results from more than a Century of their triumphs. America is like a family which has suffered a home invasion, where a gang of criminals have moved in, and taken control over what the priorities of the family have become. Young Americans grow up inside that system, and have no practical choices other that to continue to live within it, which means their best individual "choice" is to go deeper into debt, no matter how insane that is, as will later manifest more madly.

Thu, 11/14/2013 - 16:21 | 4154954 RaceToTheBottom
RaceToTheBottom's picture

 

Conventional wisdom:

To get a good job, you need a good education.

Reality:

To get a bad job, you are getting a great education.

Thu, 11/14/2013 - 14:42 | 4154963 Surging Chaos
Surging Chaos's picture

The conclusion to the student loan bubble is actually really obvious. Yellen will obviously go full retard with QE, which means that the Fed buying student loans won't be out of the question when we need another excuse to open the floodgates to MOAR.

Thu, 11/14/2013 - 15:28 | 4155160 SWCroaker
SWCroaker's picture

Pretty sure this already happens.  Gov backs the student loans; lenders hand out the cash, wait for graduation and default, pile on 400% increase in principal due to delinquency, *then* go hat in hand to the ultimate backstop (gov).   Find me the line item in the Federal Budget for making whole the banks that lent to deadbeat students.    You can't.   So the only remaining source of funds used to make the lenders whole must be coming from .... the Fed.  Shell game via the Treasury, funny accounting within Sally Mae, I'm pretty sure there is un-admitted QEasing taking place to support the pretense that is Student Lending.

Thu, 11/14/2013 - 14:42 | 4154964 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

A beautiful (and better educated) De-re-leveraging ...

The Ewok will save us.

 

Fri, 11/15/2013 - 12:48 | 4158049 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Yikes!

Thu, 11/14/2013 - 14:43 | 4154968 jubber
jubber's picture

Gold smacked down $10 since the speech...sigh

Thu, 11/14/2013 - 14:44 | 4154971 Seasmoke
Seasmoke's picture

Ahhh....the benefits of being 77YO in this economy

Thu, 11/14/2013 - 14:59 | 4155050 madcows
madcows's picture

gonna really bite when the government can't borrow any more money to give you free medicare/ss cuz us poor middle class folks certainly haven't got enough to pay for their promises.

your best hope is that the death panels get you before you starve to death.

Thu, 11/14/2013 - 14:45 | 4154973 joego1
joego1's picture

If the school can't place the student in a job they should help cover the loan default.

Thu, 11/14/2013 - 14:54 | 4155010 H H Henry P P P...
H H Henry P P P Paulson's picture

Yes, and if that happens the students will finally be able to get a job with their Bachelor's in Historical Hungarian Cabinet Making

Thu, 11/14/2013 - 15:15 | 4155054 hedgeless_horseman
hedgeless_horseman's picture

 

 

...the students will finally be able to get a job with their Bachelor's in Historical Hungarian Cabinet Making

They should be so lucky!

Some of that Hungarian work is quite nice...

Alas, a good cabinet maker does not often come from a university, but from an internship with a master craftsman, although, this school looks interesting.

Thu, 11/14/2013 - 17:27 | 4155588 MachoMan
MachoMan's picture

If the school can't place the student in a job they should help cover the loan default.

If the industry was forced to compete and didn't expect to be bailed out, you might find some voluntarily promise this...  the fact that no one innovates in this regard ought to speak volumes.

I've got a client that got an undergrad degree in business and decided against grad school and opted for flight school...  they'll put him teaching classes after he graduates to get extra seat time and they'll hook him up with a network of employers after that...  might not pay what he dreams, but it's a start...

The apprenticeship system will rise as will localism...  just the natural ebb and flow of things.

Thu, 11/14/2013 - 14:46 | 4154977 ebworthen
ebworthen's picture

If I could claim bankruptcy and leave them holding the bag I'd take out a loan to get a PhD in Economics just to spite them.

Thu, 11/14/2013 - 14:50 | 4155002 FieldingMellish
FieldingMellish's picture

"There are no bubbles."

"If a bubble forms, we will see it."

"Godzilla is largely a fictional creature... probably."

Thu, 11/14/2013 - 14:52 | 4155018 Bastiat
Bastiat's picture

Loan forgiveness in exchange for national service--next up?

Thu, 11/14/2013 - 15:15 | 4155116 Alpha Monkey
Alpha Monkey's picture

It already exists.

Thu, 11/14/2013 - 15:34 | 4155176 Prime Rib
Prime Rib's picture

Yes, this is available from National Health Services for medical graduates working in or willing to relocate to under-served areas. Remember Northern Exposure? The Doc was working off his medical school loans. This is still going on and quite helpful to those who have acquired expensive advanced degrees - cash payment every two years of up to $60,000 - for a commitment of five years employment. Tax-free.  

Thu, 11/14/2013 - 23:09 | 4156576 novictim
novictim's picture

ah..hem.  No physician with half a brain would take one of those BS "pay off your loan" deals...the numbers just don't add up.

Thu, 11/14/2013 - 14:53 | 4155020 Strider52
Strider52's picture

I know a few people that have student loans, and use the money for food, drugs, new toys, etc. They have absolutely NO intention of EVER paying it back. One guy is now doing time in the Phoenix Parallel-bar hotel, but not for student loans.

Thu, 11/14/2013 - 15:55 | 4155270 centerline
centerline's picture

Student loans are being used to buy more time.  Food, bills, etc.  and debt for the system.  The default rate is going to get really ugly.

Thu, 11/14/2013 - 21:34 | 4156302 americanreality
americanreality's picture

You have a few friends in this situation and they all share their intimate financial details with you?  I'm not buying it. You are trying to push the idea that the college loan disaster is all about students milking the system for drugs and toys. The loan problem is due to jobs not paying enough to cover all your bills in addition to $300+ a month in student loans. I'm sure there are people abusing it like any other situation but the majority of these loan problems are due to stagnant wages and the continuing rise in rent, food, gas, insurance, etc.  Just another symptom of the larger problem of how our financial system is nearing the end.  I get sick of reading these phony, recurring posts about "my friends, my cousins, my coworkers, whatever, are  taking out massive student loans for hookers and blow and claiming they don't intend to pay it back.  

Thu, 11/14/2013 - 14:54 | 4155028 halfawake
halfawake's picture

< I should still make student loan payments

< I should not

Thu, 11/14/2013 - 15:02 | 4155063 NOTaREALmerican
NOTaREALmerican's picture

Re;    I should not

It's easy for us OldFarts and NearOldFarts to offer advice on what you should do.   But, in reality, if you don't make the payments you'll be punished.    There's a debt based world and there's (basically) off-the-grid.   

The debt based world offers you the potential to live in the top 20% (or better) and be a member of the "winning" class.    Most of the OldFarts on here are in the top 10% and made it here in the debt based world.   If you don't pay, be prepared for the punishment.  AND, if you've got the guts to not pay, you might as well leave the country and move to Australia.     If you're going to take the risk of living off the grid, you might as well take the risk of starting over. 

Thu, 11/14/2013 - 15:09 | 4155093 halfawake
halfawake's picture

Agreed. I got suckered (albeit as a teenager) - I am able to pay, so as long as I can I plan on being a man of my word, either way. The world lacks too many honest people. Two wrongs don't make a right. But once I'm out... I'm out. This system can bite me.

Thu, 11/14/2013 - 15:13 | 4155107 NOTaREALmerican
NOTaREALmerican's picture

Re:  so as long as I can I plan on being a man of my word

Sounds like you may have had "mis-informed" parents too.  Oh well,  lots of us had.    The good thing is that you can blame them for not bring you up as a sociopath. 

(j/k, well,  not really, sadly)

Thu, 11/14/2013 - 15:52 | 4155258 halfawake
halfawake's picture

Indeed. My mom sat right there as the loan officer suckered us into a 20k+ first year. I don't blame her at all - her generation was sold on the college->house->retirement by any means necessary (implictly->moar debt). As is mine. But I know what I'll be telling my children (college is optional, and certainly not worthy of debt serfdom for any amount of time), so not all is lost.

Thu, 11/14/2013 - 14:55 | 4155036 Alcoholic Nativ...
Alcoholic Native American's picture

I got over 30k and haven't made a single payment, I didn't even graduate. They can't dock my pay though cause I make well below the poverty line.  

Someone made a very bad investment on me.  

Thu, 11/14/2013 - 15:56 | 4155275 corporatewhore
corporatewhore's picture

is that due to the state you live in or is that in the federal law?  i thought they could tap anything including social security  .  Garnishment limited by state law.

Thu, 11/14/2013 - 21:43 | 4156337 americanreality
americanreality's picture

Hmm.  It sounds like you are not, as a lying idiot once said, "a man of your word". /s  

I'm in the same boat.  Its hard living in the crooked system, its hard living outside of the crooked system. Might as well opt out and not support the insanity.  That takes courage. Playing along is putting your tail down between your legs, covering your genitals, and submitting.    

Thu, 11/14/2013 - 14:57 | 4155041 NOTaREALmerican
NOTaREALmerican's picture

Personally,  I think it's good that students aren't paying.   It shows more and more of them are learning it's a screw or be screwed society.

The OldFarts pretend their Medicare isn't welfare, the students pretend their loans aren't loans, the Red Team pretends Big-MIC isn't welfare, the Blue Team pretends more debt "helps the children".... 

Duplicity,  ask for it by name!

Thu, 11/14/2013 - 15:06 | 4155075 MustacheCashStash
MustacheCashStash's picture

Yellen:  These aren't the bubbles you're looking for.

Market: These aren't the bubbles we're looking for.

Thu, 11/14/2013 - 15:19 | 4155118 Jack Burton
Jack Burton's picture

Because there is largely nothing for a new High School Graduate to do upon being proclaimed "educated" by the state run schools, their options are now highly limited. Work is now a word that means minimum wage, part time and zero benefit for the average High School Graduate. Note: When I graduated many years back, a portion of kids moved into trainee programs at factories, mines and mills. Some went straight to the shop floors. Others took 1 or 2 years technical school and found industrial work or light manufacturing work. Pay was decent and benefits scetchy but in some places they at lease existed. Todays kids can not go that route, all that work is overseas in cheap labor nations being done on contract for US corporations. The military was our second option, and my choice. Four years got you a few months of post bootcamp training and then off to war or defensive cold war deployments. Six years got you a two year technical education and four years in a deployed unit, this was my choice. This option is there, but only in a limited number of cases, the raw numbers of troops is way down over cold war standards. Today's kids find the military a very good option if they can get in. BUT, the real "game in town" is to take over half of all High School kids and track then into universities that allow them to pick from hundreds of degree paths, many of totally dubious value. A fraction of these kids become elites in medicine, law, corporate management, but in raw numbers, this has not changed since I was born. The rest of the college kids are picking up worthless degrees at huge expense. It really is a government program to get these youth off the streets and into debt for decades. Debt slave creation if you will, a double win for the establishment.

These debt slave kids often have the time of their lives in school, I know I have kids and had kids in college. Keeping them on a real path to professional education is hard, if not impossible. Drugs, boose, sex and social media. It consumes the less bright crowd. When they graduate they become a vast problem. Expecting high paid work as the colleges promised, they find instead the same service jobs the Hgh School Grads already have.

When America ended it's productive and manufacturing sectors, it left only Government, war, medical services, and more educators as the only jobs in town.

Here is an example in our local school district. See what you think. Due to budget cuts we have four day school from K-12. Teachers work Monday through Thursday with 3 day weekends every weekend. They have a Fall Break, then Thanksgiving Break, then Christmas Break, Teachers conventions, and Spring Break at Easter. All in all they can't be working even half a year. We taxpayers on the other hand are soaked in order to provide these folks with Teachers Pensions and matching funds to a 401K plus they get full Social Security and retire early on enormous incomes.

Fuck what a really fucke up game. Don't get me going on the Higher Education Systems. The University of Minnesota has professors who teach 3 times a week for two hours or less at a lecture. What a joke, and these guys get massive pay, while the university uses underpaid assistants to do all the work. Firing squads are in order for these folks!

Thu, 11/14/2013 - 16:06 | 4155312 centerline
centerline's picture

Thanks for the post JB.  I am sickened by the whole thing as well.  The school systems are terminal.  They no longer give a shit about kids.  It is all about self preservation.  Heck, there are private institutions that outright prey on people.

What really sucks is that on the way down these assholes are going to cause so much pain to so many people.

Unfortunately these systems are going to have to crash and burn.  They are beyond repair.

Can't tell you how many times I have thought about trying to start something up in the educational realm.  I really think there is a place for something new that simply does what the school systems are failing to do.  Right now may not be the time.  But, I think once the current system finally crashes, the time will be here for such things.  The private sector will rise again.  But only after the public sector goes tits up - which it will, under it's own weight.

 

 

Thu, 11/14/2013 - 16:49 | 4155453 JuliaS
JuliaS's picture

Schools are businesses and should be recognized as such. They're not social institutions, communities or enlightenment centres.

They get money and provide a service. It's an investment return proposition. Schools used to be the source of knowledge back in the ages where printed literature was scarce and communication limited. Schools provided training and mental structure necessary for factory jobs. The school day is still structured to emulate assembly line shift work with bells, breaks etc.

School creates an industrial worker. That's it in a nutshell. The warning bell should've been rinning the moment the first automobile job went overseas dedacdes. We've had 3-generations worth of advance warning - a chance to restructure, but we did nothing.

Now the only option, the way I see it, is to take the kids out of school and tell them not to waste their goddamn time - do the minimal education demanded by the state and then drive the rest of the way. I'm hoping I'll have the time to transfer my skills to my kids and give them sufficient structure and discipline to be able to pursue interests of their own.

Don't know what the "winning formula" is going to be in the following year, but I'm sure as hell that it is not what is being taught. School is a waste of time. I went through public education all the way. I've later met people that ended up exactly where I was having taught themselves and I honestly envy them. I look back at whatever little time I wasted as a kid and regret every minute of it.

I teach my kids the value of time. Nothing's more important than time.

Thu, 11/14/2013 - 15:17 | 4155124 corporatewhore
corporatewhore's picture

seems to me that everyone has figured out that we're going to collapse so why not just get it while the shit is still held together with velcro and crazyglue

Thu, 11/14/2013 - 16:12 | 4155330 RockyRacoon
RockyRacoon's picture

Velcro and crazyglue are actually pretty effective adhesives.  I'd say it's a weak magnetic attraction with a helluva hurricane about to blow.

Thu, 11/14/2013 - 15:19 | 4155131 youngman
youngman's picture

Makes one wonder how much of this economy is this ghost money keeping it up...these loans will never be paid back...so that money goes poof...but it bought books...rent...food...real items....with fake money....and what will these kids do when the reality hits....no more ghost money to spend...ask their parents first I guess...then steal

Thu, 11/14/2013 - 15:25 | 4155151 CheapBastard
CheapBastard's picture

Print moar money.

Thu, 11/14/2013 - 17:00 | 4155497 22winmag
22winmag's picture

Student loan suicides... don't make the news very often.

Thu, 11/14/2013 - 17:03 | 4155513 Elliptico
Elliptico's picture

As if by magic....

"By the time I came out of UCLA, I was somehow at $140,000 in student-loan debt. "

http://prospect.org/article/40-year-slump

Thu, 11/14/2013 - 17:39 | 4155606 TrulyStupid
TrulyStupid's picture

Let's make a Trillion dollar coin  from the wind from Krugmans ass.... issue a refund to all the students.

Thu, 11/14/2013 - 18:34 | 4155638 corporatewhore
corporatewhore's picture

i just looked up what the FEDs can garnish out of your social security to make payments on the loan.  It is the lesser of 15% of your ss payment or the amount above $900 per month.  Of course you could risk this  but that would be stupid since you can utilize the income based repayment plan or hardship deferment.  Now if you have private loans, they are SOL as to garnishing Social Security benefits.  It can't be done without stupidity on the part of the bank if allowed to tap that account.  So I believe we have a case of very smart people or so stupid they're smart making full use of the matrix.  It is, however, a full blown membership in the almost Free Shit Army.

Thu, 11/14/2013 - 21:20 | 4156272 BlueCheeseBandit
BlueCheeseBandit's picture

Seriously tho, very quick and easy solution to this problem is to pass a law making loan originating schools co-signers to every loan they originate or have originated, with joint and several liability. End all the income based repayment, 30 year loan shit. 10 year repayment begins 6 months after graduation or drop out. If the student isn't paying in full, the school has to pick up the slack or it's on both credit reports and eventually defaults, where creditors can go after the assets of student or the school for their money. Who they gonna pick?

Make this law and I guarantee you lose most of the overcapacity in education overnight. And the survivors are suddenly able to find new and innovative ways to cut tuition, reduce enrollment to those with good prospects of completing their degree and getting a good job, make students career ready, and place students in good positions.

When responsibility is for the adults too, maybe American society can get back on track.

Thu, 11/14/2013 - 22:57 | 4156543 novictim
novictim's picture

Clearly, these kids need to stop borrowing money from the lenders and just ask their parents to pay the bills.

-Mitt Romney

Mon, 12/02/2013 - 04:21 | 4205872 Melody7773
Melody7773's picture

I think the whole point of getting a higher degree is lost. When it comes to education everything is related to money, big money to be more exact. I cannot find a single reason for student to want to study and want to do it well. I assume that the majority is expecting the student loan bubble to burst out like the housing segment did in 2007. And again the unemployment market will have no perspectives. So why exactly young people have to spend sleepless nights working on their dissertations (read how to write dissertations here) when they could be looking for some real job instead? 

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