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A Modest Proposal: Students Refuse To Become Debt Slaves, Opt To Sell Equity In Their Future Wealth Instead

Tyler Durden's picture




 

The topic of the student loan bubble (and even its popping) has been digested to death on Zero Hedge. One topic that has been avoided however, is that of the student equity bubble, for the simple reason that until now the concept did not exist. That may change soon: as the Economist reports, some California students have a modest proposal to the symbiotic University-Banker net worth extraction mechanism - shove your debt. Instead, they will pay for their unaffordable education (except when funded with copious amounts of unserviceable and non-dischargable debt) with equity.

From the Economist:

Rather than charging tuition, they'd like public universities in California to take 5% of their salary for the first twenty years following graduation (for incomes between $30,000 and $200,000). Essentially, rather than taking on debt students would like to sell equity in their future earnings. This means students who make more money after graduation will subsidise lower-earning peers.

It only makes sense - with every firm now scrambling to go public, no matter how worthless, and take advantage of the latest raging excess liquidity bubble, even at the risk of flash crashing before the first trade is executed, why should individuals not be treated like corporations? And, taking it further, why not have the option of what capital structure one would grow into? Simple - because equity is associated with upside appreciation, while debt is much more focused on capital preservation. And while the American Dream teaches everyone, students especially, to believe they can achieve everything and anything in the USSA, but only if they get $100,000 in student debt first, everyone knows this isn't happening. Which is why there just happens to be a double standard when it comes to reinvesting other people's money. In essence: both university and bank would be exposed to unlimited downside, which as we all know, is a viable option only if the banks know they will be bailed out should things turn sour.

It is not clear if this will provide adequate revenue for the university. It also means the university bears more risk, because the tuition it will ultimately receive is uncertain. But the proposal will benefit some students and the principle is not so ridiculous. American universities already practice price discrimination based on parental income. The more money your parents have the larger your tuition bill; richer families already subsidise poorer ones. Why not price discriminate based on future income of the student rather than the current income of the parent?

 

It also means, in many cases, that degrees that command a higher value in the labour market, like engineering or computer science, will cost more than other degrees, like theatre arts. But if an engineering degree is worth more shouldn’t it cost more? If you think of a degree as an asset which pays dividends in future wages, the asset with a bigger expected pay-out should cost more. Faculty in high-value fields tend to get paid more. Perhaps some of that cost should be passed along to the students.

But think of the arbitrage over majors? One could have an equity funded double major in medicine and accounting, while taking out debt for those blue light special minors in sociology, psychology, English, and everything else actually taught in liberal universities.

Incentives would also change; maybe university departments would become more invested in producing sucessful graduates. But might this undermine the mission of American universities, which is (or is often assumed to be) to provide a well-rounded liberal arts education? If universities become more income focused, will low-yielding, but socially valuable fields like philosophy wind up short of resources? To some degree, the university-for-all model already undermines our idyllic version of university. As more of the population goes to university, and must pay for it, more esoteric subjects naturally become less popular.

 

A trickier concern may be what happens if this approach is not implemented everywhere? If you know you will study engineering and earn a high salary wouldn’t you then opt for a school with a fixed, up-front cost—assuming that means you’ll come out ahead? Then would all the talented engineers go to other universities and potentially undermine California schools?

So unfortunately, while this is a creative idea, its chance of success is zero. Especially since not only the student "equity" market is dead, but now JPMorgan, as we first noted 3 days ago, is quietly getting the hell out of Dodge University. Ironically, the best option for everyone involved is for the student loan bubble to pop and for college to be equitably priced. Alas, that will never happen as long as the Fed and the government are actively engaged in defining the price of money and the opportunity cost of declining to become a 22 year old leverage mule encumbered with enough debt to last a lifetime.

 

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Tue, 04/10/2012 - 16:01 | 2332509 RmcAZ
RmcAZ's picture

5% of what salary?

Tue, 04/10/2012 - 16:02 | 2332519 junkyardjack
junkyardjack's picture

I can't wait to walk to a bank and see "We Accept WIC Checks"

Tue, 04/10/2012 - 16:06 | 2332530 idea_hamster
idea_hamster's picture

students would like to sell equity

So is this going to get counted in that "Insider Selling/Buying" statistic?  I mean really -- talk about holding material non-public info during a period when you're off-loading your common on someone else!

As long as it's not tax-payer guaranteed, then fine -- but it will be.

Tue, 04/10/2012 - 16:12 | 2332597 SilverIsKing
SilverIsKing's picture

The primary difference between this idea and what is currently in place is the drop to 5% of salary from 100%.

 

Tue, 04/10/2012 - 16:43 | 2332679 Comay Mierda
Comay Mierda's picture

cant wait to see the banksters trading kids on the NYSE.  oh and the derivatives will be interesting.  want to buy a call option on a valedictorian? or a put on freshman skipping out on class to do drugs?

or pool these bitches up.  maybe they can sell shares and tranches on the Harvard class of 2012?

Now the banksters will literally own kids.  any parent out there that allows there kid to sell "equity" is fucking crazy.  this is a BIG sign of a breakdown in society

Tue, 04/10/2012 - 17:37 | 2332899 Peter Pan
Peter Pan's picture

How soon before kids are allowed to sell a kidney?

Tue, 04/10/2012 - 18:22 | 2332997 TheFourthStooge-ing
TheFourthStooge-ing's picture

Does the 5% include tips?

 

Tue, 04/10/2012 - 19:47 | 2333167 TheTmfreak
TheTmfreak's picture

Indentured servants anyone? I like how these assholes keep thinking they're "progressing" things but just keep rehashing the same fucking stupid ideas already resolved hundreds of years ago.

Tue, 04/10/2012 - 21:15 | 2333317 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

Universities are all about indoctrination. Who are we kidding. No progressive ideas here. Nothing but Marxism.

Tue, 04/10/2012 - 23:53 | 2333414 TruthInSunshine
TruthInSunshine's picture

It's very simple. As more and more people awaken to the notion of modern day debt slavery, the fractional reserve banking charlatans & snake oil pitchmen prime the pump in more creative and desperate ways in an effort to discourage people from opting out of debt slavery, which, if enough people did do, would slay the Ponzi economy built on a Pyramid of illusions we now have (and it's not that high of a percentage of people opting out of debt relative to the total population that would induce the collapse of the system).

 

Has anyone/everyone noticed how car dealerships, home builders, mortgage companies, credit card companies and other entities are dishing debt dope to even the deadbeats again?

They have to, in order for the Ponzi of an economic structure that is what fractional reserve banking (with bailed out, and soon to be bailed out again, wards of the state - sucking on the taxpayer teat - at the center of the scam) to Ponzi onward.

Here's just one example of how rotten to the core the Ponzi has become: 

FHA Reconsiders New Rule on Lending to Those With Debt

NEW YORK (MainStreet) -- The Federal Housing Administration has delayed, and will likely revamp a rule that says consumers with more than $1,000 in "collections debt" cannot get a federally backed mortgage. The FHA has put the rule on ice until July and is weighing changes to it as well, the agency reports.

If you read that article, are you surprised that the FHA, which is essentially a taxpayer backed guarantor of mortgage debt, and the world's largest mortgage guarantor (guaranteeing 36 million mortgages), is now under pressure to loan money to people with terrible credit scores, who not only have a wretched history of paying back past loans, but who currently (i.e. at the time they're applying for a mortgage) are in default in loans they had agreed to repay?

This is how the system eats itself. Fractional reserve banking can't perpetuate itself if larger batches of debt aren't issued and devoured by successive waves of greater numbers of people taking on greater amounts of debt (with already net negative worth taxpayers being put on the hook for the default risks - and the risk is more aking to an inevitability).

The refusal to take on greater amounts of debt on the part of larger participants in the economy, with trends such as this case of students at California colleges and universities, is how the fractional reserve banking Ponzi system is killed.

Bring it on. The sooner we get back to true supply/demand economics, true price discovery and equilibrium, the sooner we can shake off the fractional reserve banking charlatans and the parasites who they enable.

Tue, 04/10/2012 - 23:52 | 2333598 A Nanny Moose
A Nanny Moose's picture

Tulip bulbs have more brainpower, and a better memory of history.

Wed, 04/11/2012 - 00:25 | 2333019 oddjob
oddjob's picture

Never, but Hospitals will gladly take organs from your near dead body and profit with them.

Tue, 04/10/2012 - 18:54 | 2333055 Tim White
Tim White's picture

Too late!

Tue, 04/10/2012 - 19:16 | 2333106 booboo
Tue, 04/10/2012 - 18:22 | 2332998 Miffed Microbio...
Miffed Microbiologist's picture

Gosh, hard to guess the next step to all of this.....Hunger Games?

Tue, 04/10/2012 - 20:30 | 2333259 Trimmed Hedge
Trimmed Hedge's picture

"want to buy a call option on a valedictorian? or a put on freshman skipping out on class to do drugs?"

 

Hell, I'd write that put.. Ya never know...  ;)

Tue, 04/10/2012 - 16:30 | 2332692 theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

This is a fantastic idea. My masters degree in drama/feminism studies was something I undertook due to the most virtuous of moral principals: equality being the absolute moral right of all human beings. Someone who cynically decided that maths or engineering pays more so I'll do that has absolutely no right to take all the pie in the job market after graduation. Now I earn a good salary regulating small businesses for the government; yet I can't help looking at engineers, mathematicians, and worst of all speculators and entrepreneurs are earning for more. Any just society would seek to readdress the balance.

Tue, 04/10/2012 - 16:40 | 2332725 magpie
magpie's picture

Why, i'm even thinking of petitioning the EU parliament to lower all men's wages to women's. If there should be austerity, it should at least accomplish a noble goal. /sarc

Tue, 04/10/2012 - 16:46 | 2332748 Miffed Microbio...
Miffed Microbiologist's picture

Did you forget the /sarc ? You can't be serious.

Tue, 04/10/2012 - 17:08 | 2332826 smiler03
smiler03's picture

Sigh. No problem reeling in the suckers though I think you've pushed it too far too soon.

Tue, 04/10/2012 - 18:22 | 2333000 HelluvaEngineer
HelluvaEngineer's picture

I like to think of people in terms of how useful they would be on a deserted island.

Tue, 04/10/2012 - 18:53 | 2333054 Rainman
Rainman's picture

don't bother... I understand they're all edible

Tue, 04/10/2012 - 19:07 | 2333087 Offtheradar
Offtheradar's picture

People generally suck, me included.

Tue, 04/10/2012 - 22:40 | 2333451 ElvisDog
ElvisDog's picture

Ginger, Mary Ann, totally useful. Mrs. Howell, not so much.

Tue, 04/10/2012 - 19:06 | 2333080 Bobbyrib
Bobbyrib's picture

LOL, I agree with your point (it has to be sarcasm), except with including speculators with entrepreneurs. People that speculate and drive up the cost of living for everyone are scumbags.

Tue, 04/10/2012 - 20:03 | 2333198 Captain Planet
Captain Planet's picture

@MAXILOPEZ

this makes little sense on a lot of levels.....

exactly how does your advanced in degree in BS qualify you for a higher payscale?

regulate me all you want, I'm the one with an idea to transform local economies and reduce the number of families on food stamps. and I'm the one who is going to build it myself....and you think you should be earning more than me? how 'bout this, I'll buy you a drink.

Tue, 04/10/2012 - 21:17 | 2333324 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

CP, most who attend lesbian studies can't even pass introductory engineering courses.

Thu, 04/12/2012 - 10:11 | 2337614 Ura Bonehead
Ura Bonehead's picture

This is a fantastic idea. My masters degree in drama/feminism studies ....

Let me see..... 5% times.....  Times 20 years....  Yes, the equity on that degree path has to be worth, what?  $200 at least.

P.S.  I took a number of years of practical pass/fail lab work in 'female' studies while in college.  Is that the same thing???

Tue, 04/10/2012 - 19:06 | 2333081 CrashisOptimistic
CrashisOptimistic's picture

Who is going to fund TODAY's faculty salary waiting for this uncertain future cash flow to arrive?

Wed, 04/11/2012 - 02:05 | 2333748 Sokhmate
Sokhmate's picture

they fund themselves, of course. Or just quit facultying.

Wed, 05/23/2012 - 09:56 | 2454619 kall
kall's picture

Still, this is a controversial measure, it should take me a while to figure out it's real implications. There's a new trend of students studying online to avoid student loans, we should take the online environment into consideration in this kind of debates.

Tue, 04/10/2012 - 17:04 | 2332817 Arnold Ziffel
Arnold Ziffel's picture

Off Balance sheet equity I suspect.

 

However, Universities now have a stake in the game...or whomever loans the moolah instead of handing it to any warm body that they pull into the loan office no matter how lugubriously droll their chances of landing a job are.

Tue, 04/10/2012 - 16:19 | 2332636 SheepDog-One
SheepDog-One's picture

Its got to be a frightening proposal for the colleges themselves...it would mean their graduates would actually be qualified and would make money. We all know how thats been going for grads over the last few years...move back in with the folks and cross fingers for that Walmart job.

Tue, 04/10/2012 - 16:50 | 2332756 easypoints
easypoints's picture

Exactly. With all of your debtors paying 5% of 8.50 per hour, it's hard to stay in business. The useless degrees and the deploma-mills should quickly fall off the map. Creating qualified and productive graduates will actually be reflective of college revenue, rather than pumping out as many unsuspecting debt-slaves as possible.

Tue, 04/10/2012 - 17:16 | 2332772 Robot Traders Mom
Robot Traders Mom's picture

It makes sense on the surface if this is a contract with a university and they want to stand behind their education, but the Economist is the mouth for the Bilderbergs/Trilaterals, etc.

 

Surely this will turn into a casino.

Tue, 04/10/2012 - 17:48 | 2332921 Azwethinkweiz
Azwethinkweiz's picture

Altucher posted a blog the other day about going to business school, he wrote:

"Business school classes are junk. How do I know this? Because I took some. I stopped showing up at classes, I didn’t do the homework, I’d get a C- on the Final andwhat would my final grade be? B+. Why so high? Because business schools want you to have high grades so so you can get great jobs so they can advertise that all their students work at GoldmanSachs now. They wouldn’t want to say the opposite: that all their ex students now work at gas stations. So the actual education is BS."

Would it be any different? We'd have corporate sponsored schools pushing their graduates to work for the sponsor(s). Surely we could pump out a couple thousand kids to sign false mortage documents and push them from one side of the desk to the other and take a hefty six-figure salary in doing so to subsidize those who do work at the gas stations.

If it doesn't turn into a casino, it'll turn into a 3 ring circus.

Tue, 04/10/2012 - 19:54 | 2333184 aerojet
aerojet's picture

I learned this about B-schools pretty fast--it's not about the classes, it's about the connections!

Tue, 04/10/2012 - 17:27 | 2332883 dwayne elizando
dwayne elizando's picture

I'm waiting for the day when Wal-Mart, JP Morgan and McDonalds all merge to become McMorgan-Mart.

Tue, 04/10/2012 - 18:09 | 2332975 TheSilverJournal
TheSilverJournal's picture

The federal government has already done it and it's called wal mart. Food stamps are used in the wal mart grocery store (as well as social security and unemployment checks), obamacare at the pharmacy, and the wal mart bank, as all banks do now, only exist because they're fully supported by the government printing press.

Tue, 04/10/2012 - 18:52 | 2333052 krispkritter
krispkritter's picture

Most of the local Walmarts have McDonald's built right in and they take SNAP cards...

Tue, 04/10/2012 - 19:39 | 2333151 Willzyx
Willzyx's picture

You missed the big one.  There really aren't unemployment cheques anymore.  Rather prepaid debt cards issued by Chase

Tue, 04/10/2012 - 19:30 | 2333134 Ganja Jane
Ganja Jane's picture

This is nonsensical; WIC checks are deposited by the WIC approved merchant in their accounts like regular checks. Way back when food stamps were paper, approved merchants could deposit them into their business accounts like regular FRNs. I helped manage a little corner store that accepted these 15 years ago. Unless the bank is selling formula, milk, peanutbutter, beans, eggs and formula, I doubt participants will be able to deposit these for cash.

Tue, 04/10/2012 - 19:46 | 2333162 Chuck Walla
Chuck Walla's picture

At least this idea aligns the school's take with the interests of the students. maybe they might even get interested in teaching something useful. maybe...

Tue, 04/10/2012 - 16:07 | 2332554 dwdollar
dwdollar's picture

Exactly... that's why this will never work.

Tue, 04/10/2012 - 16:29 | 2332682 OpenEyes
OpenEyes's picture

I think the bigger reasont that this plan will never work is that it cuts out the banks!  If the school can 'sell' the 'education' directly to the student for a percentage of future earnings then the banks aren't getting their cut of the action.  The IRS won't be all that happy with it either since it'll be a no-brainer political move for a few congressturds to pass legislation to get that 5% skim to the schools as tax-deductable.   

Tue, 04/10/2012 - 16:56 | 2332794 Al Huxley
Al Huxley's picture

You're not thinking like a (Wall Street) banker.  This is a brand new (unregulated, undefined) market.  Consider the options for bundling the income streams, package them up like mortgages, create tiers based on majors, create futures markets to bet on salaries for different disciplines, resell the packages to European institutions, create 'subprime' markets, derivatives, options markets - the opportunities for a creative and amoral 'financial engineer' are virtually limitless.

Tue, 04/10/2012 - 19:48 | 2333168 Chuck Walla
Chuck Walla's picture

@ Al Huxley Christ, you're devious!  Do you work for Goldman?  If not, they should recruit you ASAP.

Tue, 04/10/2012 - 19:57 | 2333189 aerojet
aerojet's picture

Somehow, I don't think the suckers from last time are going to be in a buying mood this time around.

Tue, 04/10/2012 - 17:18 | 2332857 Bwahaha WAGFDSMB
Bwahaha WAGFDSMB's picture

It's been tried before, the reason it didn't work is that all the liberal arts majors opted in and the engineering majors opted out.

Tue, 04/10/2012 - 17:43 | 2332918 NumberNone
NumberNone's picture

Agreed.  Right now the US is an importer of skills like Engineers and Pharmacists.  US colleges cannot graduate enough US citizens to meet the employer demand.  I would love to see the US and it's colleges giving away education in these fields to US citizens.  Unfortunately a free education in these skillsets will most likely be met with crickets chirping from the same students demanding free educations.  . 

Tue, 04/10/2012 - 18:04 | 2332965 dwdollar
dwdollar's picture

LOL...

Tue, 04/10/2012 - 18:29 | 2333018 skipjack
skipjack's picture

"US colleges cannot graduate enough US citizens to meet the employer demand."

 

Was that sarcasm ?  Because I'm sure that STEM would attract a lot more folks if 1-they could find jobs and 2-they were paid better than the graduates from feminist(harpy) studies.  Just ask any CS major who's lost a job to India, China, etc, whether offshoring or via H1B.

Tue, 04/10/2012 - 20:26 | 2333253 PalladiumJockey
PalladiumJockey's picture

yeah---  I've decided anytime the market says there is a shortage, it means there will a flood of cheaper labor soon... sucks for everyone.  As the world market gets larger, each individual becomes more meaningless.

Tue, 04/10/2012 - 19:09 | 2333091 Bobbyrib
Bobbyrib's picture

I can't believe someone actually believes the BS American CEO's spew. LOL.

Wed, 04/11/2012 - 01:55 | 2333739 Savvy
Savvy's picture

When President Obama personally asked for Darin Wedel’s CV the unemployed engineer probably thought he had a job in the bag.

But more than two months since sending his CV to the White House Wedel is still out of work.  

The President requested the résumé during a live video call with Jennifer Wedel, who wanted to know why her husband had not been able to find a job for three years despite his skills as a semiconductor engineer...

http://www.dailymail.co.uk/news/article-2127446/Unemployed-engineer-told-Obama-send-resume-White-House-STILL-work-months-later.html#ixzz1rhyoDTfF

 

 

Wed, 04/11/2012 - 04:30 | 2333850 prole
prole's picture

A- Dude is a white male, and in today's USSA, that is employment poison "no white men need apply." esp for any federal job.

B- Job offers did actually pour in, but said white dude is extremely picky, only "north texas" jobs will be considered by said nabob. WTF? Obviously Scout here is not hungry. His family has already found a work-around anyway: his wife is working. So this is a problem which has already solved itself in this case.

So for the "new niggers" or white men in America, if you want to eat, just make sure you have good parents, or find a smart wife, your new pigmented overlords like to have nice looking white women around the office, but you aren't needed.

Tue, 04/10/2012 - 16:16 | 2332578 The Swedish Chef
The Swedish Chef's picture

Don´t be unfair, McDonalds does pay it´s employees...

Tue, 04/10/2012 - 16:46 | 2332749 The Disappointed
The Disappointed's picture

But the qualified applicant for the position @ McD's must be able to say 'Do you want fries with that?' in 10 different languages.

The Other Dave in SF (where all the swans are pink).

Tue, 04/10/2012 - 18:36 | 2333030 Stoploss
Stoploss's picture

Does Rosetta Stone have a disc for ghetto??

I don't go to fast food places because i can't understand what they are saying, and pig slop is more nutritious anyway.

However, i do speak pistola, and take that with a side of laser sighting.

Wed, 04/11/2012 - 04:31 | 2333852 prole
prole's picture

Just do what I do at McDonalds: peek inside and if it's Latinos working there you'll be fine, otherwise RUN Forest run!

Tue, 04/10/2012 - 16:14 | 2332591 Pool Shark
Pool Shark's picture

 

 

"Alas, that will never happen as long as the Fed and the government are actively engaged in defining the price of money and the opportunity cost of declining to become a 22 year old debt mule encumbered with enough debt to last 2 lifetimes." 

There, fixed that for you Tyler...

Tue, 04/10/2012 - 16:27 | 2332673 Ratscam
Ratscam's picture

That,s what FEMA camps are for.

Tue, 04/10/2012 - 16:48 | 2332763 The Disappointed
The Disappointed's picture

'Soylent Green is People!'.

The Other Dave in SF (where all the swans are pink)

Tue, 04/10/2012 - 16:19 | 2332641 battle axe
battle axe's picture

Why it will be the salary they will earn in the salt mines. The American dream RmcAZ.

Tue, 04/10/2012 - 16:23 | 2332650 Gully Foyle
Gully Foyle's picture

Isn't this the plot to in time? Except instead of selling off their future aging they sell of their future income.

Read Vinge's Rainbows End, much more interesting economics of a future society.

Tue, 04/10/2012 - 16:35 | 2332704 SunnyDD
SunnyDD's picture

Hehe, Just love it!

5% here, 5% there, next you know,

tata... It's 200% +  5% more.

 

 

Tue, 04/10/2012 - 16:44 | 2332740 Larry Dallas
Larry Dallas's picture

This is bullshit. Pure and simple. So now the risk is transferred in the "student cap stack" from debt to equity? Can the students BK the equity away or is it a tax?

This will never hold.

Tue, 04/10/2012 - 17:04 | 2332818 tgmur10
tgmur10's picture

5% of Nothing is still Nothing!! hehehehe

Tue, 04/10/2012 - 19:23 | 2333122 Jay Gould Esq.
Jay Gould Esq.'s picture

College degree ? Trifling value; the sole exception being those earned in the Sciences.

Pursue a lucrative, sought-after trade, and become a Master - e.g., plumbing - or, if the Armed Services pique your interest, consider the Coast Guard. Your future will be far more rewarding than living with your parents at age 30, with a B.A. in "Communications," working as a coffee jerk - pardon me, a "barista."

Tue, 04/10/2012 - 20:32 | 2333265 PalladiumJockey
PalladiumJockey's picture

Think again about science degrees.  The flood of foreign degrees in Science and Engineering is really driving those down as well.  Think about it: SEVEN BILLION PEOPLE on earth, and when companies can now pick and choose among them, who will they pick? Those that will work the most for the least.  Which usually can't be First Worlders right now.

Wed, 04/11/2012 - 14:33 | 2335318 PayneNita
PayneNita's picture

my classmate's sister makes $62 hourly on the laptop. She has been unemployed for 5 months but last month her pay check was $13843 just working on the laptop for a few hours. Read more on this web site ....  http://bit.ly/FPPP3j

Tue, 04/10/2012 - 16:01 | 2332514 bank guy in Brussels
bank guy in Brussels's picture

By the time this is sorted out, regular university 'degrees' will be nearly free via internet education.

Tue, 04/10/2012 - 16:05 | 2332539 Dr. Kenneth Noi...
Dr. Kenneth Noisewater's picture

Hell, a "degree" will morph into a series of XBox-style Achievements that you'll have available on your LinkedIn profile..  

Tue, 04/10/2012 - 16:07 | 2332553 SheepDog-One
SheepDog-One's picture

Already is. You can be 1,000x more 'educated' today in the right places on the internet than any college PHD got 20 years ago.

Tue, 04/10/2012 - 16:10 | 2332581 Spastica Rex
Spastica Rex's picture

Education isn't about education, it's about certification and licensing.

Tue, 04/10/2012 - 16:15 | 2332613 SheepDog-One
SheepDog-One's picture

Well, until the 'education' actually means youre ahead of other people without said education. Todays 'educations' are nothing more than a bunch of BS certified by a piece of paper. Big deal. Look at most of these educational degrees, theyre garbage, poli-sci and liberal arts nonsense. 

Tue, 04/10/2012 - 20:04 | 2333209 nmewn
nmewn's picture

To add to that, as I never tire of pointing out...it is a small minority of the highly degreed who have brought the majority to the precipice we face now.

Oh...if we could just find a few degreed intellectuals to lead us away from this new unforseen danger ;-)

Tue, 04/10/2012 - 16:15 | 2332618 Sudden Debt
Sudden Debt's picture

Sadly it is. Almost every big company was started by people who knew how to use their mind and who didn't need a certificate.
America was build by people like that. So was Europe.

Tue, 04/10/2012 - 17:59 | 2332957 Belarusian Bull
Belarusian Bull's picture

People with brain are terrorists.

Wed, 04/11/2012 - 04:36 | 2333854 prole
prole's picture

Did you have gold/property or were you crushed in your recent currency devaluation?

Or did you have local debt-- which would have been brilliant!

Tue, 04/10/2012 - 16:36 | 2332715 peekcrackers
peekcrackers's picture

You forgot brain washing

Tue, 04/10/2012 - 16:55 | 2332788 The Disappointed
The Disappointed's picture

To paraphrase 'The Fight Club':

'The first rule about brain washing is that you don't talk about brain washing'

Thanks for teaching me that, Tyler. I owe you big time for that favor.

The Other Dave In SF (where all of the swans are pink).

Tue, 04/10/2012 - 17:58 | 2332954 johnnynaps
johnnynaps's picture

And certification and licensing is about siphoning more from the unfortunate/jobless. $300 here for this cert, $500 there for that license. For such a free country, it fucking costs a ton just to be marketable and potentially land a job. And the kicker, obtaining a license can be achieved by any half-retarded scumbum.

Tue, 04/10/2012 - 18:20 | 2332989 Shizzmoney
Shizzmoney's picture

Right....it's just about being "qualified" enough for that corporate job that has shitty benefits and a median-to-low wage for those under 35.

But hey, let's just have put-options out on our kids.  Maybe sell off their balls so finally, bankers can have a pair.

Tue, 04/10/2012 - 18:33 | 2333023 TheFourthStooge-ing
TheFourthStooge-ing's picture

Spastica Rex said:

Education isn't about education, it's about certification and licensing.

Credential mills.

 

Tue, 04/10/2012 - 22:07 | 2333400 Dingleberry
Dingleberry's picture

Tru dat....I took an ethics course (online even) and it purported that the main reason we have education and accompanying licenses is to limit competition for jobs, and hence drive up wages in those fields.  I always thought it was for the "public good" that we did this. Boy was I wrong. Edumacation is a racket.

Tue, 04/10/2012 - 16:12 | 2332583 LongSoupLine
LongSoupLine's picture

 

 

exactly...ZH is a perfect example.  I've learned more here than with any of my degrees and its "professors".

Tue, 04/10/2012 - 16:46 | 2332727 Ratscam
Ratscam's picture

same here as a Wharton grad. Sorry to say dear alma matter.

Tue, 04/10/2012 - 22:10 | 2333403 Dingleberry
Dingleberry's picture

Much agreed. In fact, since I have been reading all these "alternative media" types, I am SO PISSED OFF that I did not get taught this shit in school. What did I go there for?  I used to think "fiat" meant a shitty Italian car. Thanks to the web, that term is now synonymous with the Fed.

Tue, 04/10/2012 - 16:14 | 2332607 navy62802
navy62802's picture

MITx is already moving in this direction.

Tue, 04/10/2012 - 16:47 | 2332751 sdmjake
sdmjake's picture

"A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects."

-Robert A. Heinlein

Tue, 04/10/2012 - 16:04 | 2332534 blunderdog
blunderdog's picture

Well that should help eliminate the quaint old notion that colleges are supposed to provide an EDUCATION, or that anyone who attended ever WANTED one.

Will it be the ant-farm future for us all?

Tue, 04/10/2012 - 16:28 | 2332676 CH1
CH1's picture

Without institutionalized "education," people will learn more and use it better... by FAR.

And, BTW, the usual sob story about the "underprivledged" kid is pure BS... does anyone really believe that the current system saves him? There were plenty of charity schools before "education" put them out of business.

Tue, 04/10/2012 - 17:48 | 2332928 blunderdog
blunderdog's picture

As long as we're getting rid of the bathwater, no one will miss the baby.

"Education" and "college" are only incidentally related, but it doesn't follow that institutions designed to educate cannot do it better than any random person who has knowledge or skills.

I suspect this is the sort of nuance that may require a good education to perceive, though, and most folks ain't got that.

Tue, 04/10/2012 - 18:07 | 2332969 CH1
CH1's picture

A good tutor is the best educator of all. There is no magic in a curriculum.

Education is easy: Read the books, listen to the lectures and find someone informed to ask when you have questions.

Oh... and PUT IT INTO PRACTICE. You don't really know until you DO.

Tue, 04/10/2012 - 18:33 | 2333024 blunderdog
blunderdog's picture

You're right, but a good tutor is incredibly rare. Teaching is a very difficult thing to do *well.*

The idea behind institutionalizing the process is the same as institutionalizing any other endeavor--your goal is to collect the people who do something well and have them repeat it consistently.

This is not to be confused with starting an "education industry" or a professional training center.  The goal of starting a business is to make money, not to carry out a given activity.

Tue, 04/10/2012 - 16:45 | 2332745 RafterManFMJ
RafterManFMJ's picture

I'm matriculating at ZeroHedge U - for free! 

I've already completed Gold/Silver/Lead 101

Thinking about Heirloom Seed Gardening and Rabbits for Meat this spring.

Tue, 04/10/2012 - 18:20 | 2332990 Amish Hacker
Amish Hacker's picture

Don't forget the class on boating safety. ZH-ers seem to be especially prone to boating accidents that result in the irrecoverable loss of precious metals.

Tue, 04/10/2012 - 20:23 | 2333245 Bobbyrib
Bobbyrib's picture

I just happen to look at Heirloom's website last night. If you "Google": "Heirloom seed reviews" you can see one guy who tried to contact them with questions and never received a response. That's a red flag for me.

Tue, 04/10/2012 - 16:04 | 2332537 PaperBear
PaperBear's picture

Equity rather than debt ? What a wonderful idea.

Tue, 04/10/2012 - 16:05 | 2332541 GMadScientist
GMadScientist's picture

Okay, but we get to have frequent shareholder meetings where we rip the bong out of your hand; strictly in the name of "protecting our investment", of course.

 

Tue, 04/10/2012 - 16:24 | 2332661 Oh regional Indian
Oh regional Indian's picture

+++++++++

ori

Tue, 04/10/2012 - 16:32 | 2332695 noob
noob's picture

GMadScientist. . . BWAHAHA

Tue, 04/10/2012 - 16:12 | 2332548 Sudden Debt
Sudden Debt's picture

Fine. Just write your name under "I hereby sell my soul to the devil" in blood.
And again under "and offer my first born to the highest bidder"

And now you can go to collage... Here's a beer bong to get you started...

Tue, 04/10/2012 - 16:13 | 2332606 junkyardjack
junkyardjack's picture

If you default, the bank will foreclose on you.  Didn't Goldman Sachs have a site dedicated to that, those guys are always on top of the curve I tells ya.

Tue, 04/10/2012 - 16:26 | 2332671 Gully Foyle
Gully Foyle's picture

Sudden Debt

Dude, you are talking about the SUBWAY character on a recent episode of Community.

Tue, 04/10/2012 - 16:06 | 2332551 Storm Bringer
Storm Bringer's picture

I am thinking that Harvard would like to have a 5% stake in Facebook.

 

Tue, 04/10/2012 - 16:19 | 2332635 adr
adr's picture

The interest on the Harvard endowment is enough to provide a free education to all who are accepted to Harvard every year. Harvard doesn't need to charge a tuition. Neither does any other Ivy league school. However they do need to keep up the appearance that you need to come from blue blood to even ever hope to attend Harvard. Brains can never be worth as much as lineage, that can never be allowed.

THE REIGN OF MONARCHS AND BANKERS FOREVER!!!!!!

Tue, 04/10/2012 - 17:27 | 2332876 Crack-up Boom
Crack-up Boom's picture

It's not just Harvard et al.  Most colleges are better endowed than Dolly Parton.  And, personally, I think the world would be a better place if fewer individuals earned "philosophy" degrees.  

Tue, 04/10/2012 - 19:51 | 2333174 Willzyx
Willzyx's picture

Ditto for the Catholic Church.  They have enough money to feed the hungry several times over

Wed, 04/11/2012 - 04:43 | 2333857 prole
prole's picture

Idiot.

Notice Will didn't say "The US .gov has enough money.... Or "Oprah has enough money...

Tue, 04/10/2012 - 20:24 | 2333175 Willzyx
Willzyx's picture

double

Tue, 04/10/2012 - 18:30 | 2333017 Amish Hacker
Amish Hacker's picture

Recently, Harvard got rid of a good chunk of that excess endowment by putting Larry Summers in charge of it.

Tue, 04/10/2012 - 21:20 | 2333331 mkkby
mkkby's picture

Stop posting this garbage on every other thread.  Who gives a shit how much money they have.  Does that mean they owe you a free education?

Tue, 04/10/2012 - 16:23 | 2332656 Manthong
Manthong's picture

Probably, but they don't need a stake in anything..

Proof positive that education is about money and power is that Harvard could provide 100% free tuition using less than the interest on their "endowment".

http://www.dailycampus.com/2.7438/harvard-endowment-should-mean-free-tuition-1.1057409

Duped whilst I was typing, but here's the link.

 

Tue, 04/10/2012 - 16:30 | 2332688 CH1
CH1's picture

Facebook will go the way of AOL... and the sooner the better.

Tue, 04/10/2012 - 21:19 | 2333326 chemystical
chemystical's picture

AOL didnt have the Defense Intelligence Agency (and the rest of the alphabet soup acronym depts) as intimate partners from day 1.

if you think that a competing technology is on the horizon (or will not quickly be co-opted into FB as soon as it appears), then you might be waiting for Studebaker to come back.

as long as they continue to play ball with Big Bro, FB is not at risk (at any point remotely beyond the ofrseeable future).  and as long as "they" = Big Bro, what else would you expect "they" to do?

Tue, 04/10/2012 - 16:07 | 2332555 ZippyBananaPants
ZippyBananaPants's picture

How about Alcoa estimates so fricking low that Bernanke could now sqeeze under them.

Oh, lets bring in the round table of idiots (on bloomberg) and jerk each other off over this fantastic beat!!

Tue, 04/10/2012 - 16:16 | 2332590 SheepDog-One
SheepDog-One's picture

Thats ok, over on CNBC the headline states Alcoa doesnt really mean anything now, 'no overall market bearing' I think it said....I guess they must be expecting a miss even with the highjump bar buried a foot under ground.

Tue, 04/10/2012 - 16:17 | 2332631 junkyardjack
junkyardjack's picture

Crisis averted, their up 4.5%.  Everyone can start buying again...

Tue, 04/10/2012 - 16:39 | 2332658 SheepDog-One
SheepDog-One's picture

AH well good for Alcoa, citing its never been better out there in the economy....well, theres goes everyones QE3 hopes out the window! Economy just fine!

Tue, 04/10/2012 - 16:08 | 2332557 HD
HD's picture

One must wonder why a "free" online university will never get accreditation...

Tue, 04/10/2012 - 16:11 | 2332584 Sudden Debt
Sudden Debt's picture

Or a free cereal box university...

Tue, 04/10/2012 - 16:16 | 2332620 HD
HD's picture

Lucky Charms University and Captain Crunch Community College are fine institutions I assure you.

Tue, 04/10/2012 - 16:11 | 2332585 Sudden Debt
Sudden Debt's picture

Or a free cereal box university...

Tue, 04/10/2012 - 16:32 | 2332698 CH1
CH1's picture

One must wonder why a "free" online university will never get accreditation...

So long as people bow down and worship the god of Certification, thus it will remain.

Wed, 04/11/2012 - 06:07 | 2333900 Chicken_Little
Chicken_Little's picture

mises.org would never get credited with anything except the truth. Free? Their knowledge is free.

Tue, 04/10/2012 - 16:08 | 2332561 SheepDog-One
SheepDog-One's picture

Looks like it will be a tough sell...it would be hard for even a bankster PHD to figure out how to leverage this 40X and bundle the derivatives.

Tue, 04/10/2012 - 16:08 | 2332562 The Swedish Chef
The Swedish Chef's picture

Student loans in Sweden actually work like this but instead it´s 4% and you pay until you either service the debt or retire. Hey, Americans, your country is gradually turning in to Sweden. 

Tue, 04/10/2012 - 16:13 | 2332604 Bam_Man
Bam_Man's picture

But without the free healthcare.

Tue, 04/10/2012 - 16:27 | 2332675 Gully Foyle
Gully Foyle's picture

Bam_Man

Or the hot Blondes.

Tue, 04/10/2012 - 17:09 | 2332835 The Disappointed
The Disappointed's picture

Most of the Swedish women I've ever seen were not good-looking. (At least they aren't as fat as American women, nor did they have so many tattoos).

FWIW

The Other Dave if SF (where all of the swans are pink and unimpressed with Swedish women)

Tue, 04/10/2012 - 19:36 | 2333142 edstar
edstar's picture

A variant of this system is in operation in Australia. Its debt (from the gov'ment) not equity. Repayments occu thru the tax system when you earn over $40k.

http://en.wikipedia.org/wiki/Tertiary_education_fees_in_Australia

Wed, 04/11/2012 - 02:15 | 2333765 Hobbleknee
Hobbleknee's picture

America has free health care and government spending on healthcare is greater than Sweden's. The difference is that in America, if you have money, you can get any treatment you want, but in Sweden, you can wait in line or be denied.

Wed, 04/11/2012 - 05:01 | 2333863 prole
prole's picture

America does not have free health care. You just stated something that is 100% a lie.

For American citizens, who have any assets or even any credit score, or are above feral, there is no free medical in the slightest. IF you are an illegal alien, or you are a feral citizen without assets, fixed address or the slightest concern over anything like "debts" if "debts" to you are some kind of joke, because you live on the street or welfare housing anyway, then yes, for you emergency room and hospital care will be free. I guess they show up at the hospital with no ID, or welfare 'free everything card,' but I don't really know how they scam it.

I doubt anyone who fits the above description is on ZH or ever heard of ZH.

Thu, 04/12/2012 - 08:57 | 2337329 Hobbleknee
Hobbleknee's picture

You said it's 100% lie, then you proceed to explain how people get if for free.

The truth is that there are free services in place, but you have to demand them.  It's not something they advertise, and of course most people think like you do.  I mean no disrespect.

Tue, 04/10/2012 - 16:21 | 2332651 LawsofPhysics
LawsofPhysics's picture

So can I be paid in Swiss francs?  sounds like a good thing.

Tue, 04/10/2012 - 16:43 | 2332737 The Swedish Chef
The Swedish Chef's picture

Why would USA turning in to Sweden change the currency to Swiss francs? Stop being such a stereotype and at least act like you know anything about the rest of the world...

Tue, 04/10/2012 - 17:38 | 2332902 NotApplicable
NotApplicable's picture

Hey, they're pretty close!

I find it hilarious that you've responded to this post with such a stereotypical Swedish character.

Tue, 04/10/2012 - 16:09 | 2332565 urbanelf
urbanelf's picture

But that would give colleges insentives to make their students productive.

Tue, 04/10/2012 - 16:13 | 2332598 dwdollar
dwdollar's picture

They'd have to stop being a degree farm and start being a partner in the process.

Tue, 04/10/2012 - 16:10 | 2332566 Sudden Debt
Sudden Debt's picture

They'll never do it... Because it would mean they would have to offer good education to make sure the students get good grades... Talk about risk on...

Tue, 04/10/2012 - 17:02 | 2332811 XitSam
XitSam's picture

Another reason: Schools would select only those likely to graduate and not be underachievers after graduation. 

Tue, 04/10/2012 - 17:16 | 2332854 Sudden Debt
Sudden Debt's picture

The 1% :)

Tue, 04/10/2012 - 16:10 | 2332572 insanelysane
insanelysane's picture

The higher education industry is going to change from 4yr degrees to shorter term training via internet that is priced to market.  It is no longer cost effective for a computer programmer to take astronomy 101, ancient greek history, and sociology in order to get a degree in programming.

Tue, 04/10/2012 - 16:19 | 2332634 LawsofPhysics
LawsofPhysics's picture

With many excellent and experienced workers being forced to work for less and longer, I am going to take the other side of that trade and bet that the 4-year experience will become an 8 year one.  In fact, look how long it takes the average doctor to get educated before they start practicing or making money.  Look at how specialized some fields have become, and how long engineers suffer before they make any real money.  You may be right about bullshit qualitative degrees where "success" is very subjective, but certainly not in the hard sciences.

Moreover, history is pretty clear on this.  When the SHTF and unemployment is going up, finding a job gets more complicated, not less.  Adding bullshit paperwork, adds jobs all by itself, look at the U.K.

This is all the result of man's failure to truly understand the consequences of exponential equations and the current eCONomic system's dependence on growth forever.

Tue, 04/10/2012 - 16:21 | 2332652 adr
adr's picture

You actually met a doctor that earned their degree? Instead of just being part of a quota. You can be a minority and miserably fail the MCAT and still make it into medical school. White male, forget it, even a 95% isn't good enough if there are more than 3 of you trying to get in.

Tue, 04/10/2012 - 16:30 | 2332694 Maghreb
Maghreb's picture

I heard another black dude saying the exact same thing yesterday. Those Indians are really kicking ass in med schools these days.........

Tue, 04/10/2012 - 20:42 | 2332728 1911A1
1911A1's picture

I call BS, personally knowing three white males and three white females currently in or just completing med. school at Wayne State University, University of Cincinnati, and Michigan State.  The graduating classes are not non-white-male.

You may want to rethink your beliefs based on the enrollment numbers for 2011:  https://www.aamc.org/download/160146/data/table31-enrll-race-sch-2011.pdf

Given the down votes for this post, it seems some ZH readers are unable to follow links.  60% of medical students in the U.S. in 2011 were white.

Do NOT follow this link or you will be banned from the site!