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Student Loan Debt Slaves In Perpetuity - A True Story Of "Bankruptcy Hell"

Tyler Durden's picture




 

The numeric implications as well as the magnitude of the student loan bubble have been discussed extensively before. Yet just like most people's eyes gloss over when they hear billions, trillions or quadrillions, so seeing the exponential chart of Federal Student debt merely brings up memories of a math lesson from high school, or at best, makes one think of statistics. And as we all know statistics are faceless, nameless and can never apply to anyone else. It is the individual case studies that have the most impact. Which is why we would like to introduce you to Devin and Sarah Stang - student loan debt slaves in perpetuity.

First, for those who are still unfamiliar with the brush strokes, here is the big picture, courtesy of AP:

The Federal Reserve Bank of New York estimates 37 million Americans have student loan debt, totaling $870 billion. The average balance is around $23,000 (though that partly reflects a relatively small number of very large balances; the median is $12,800). Only 39 percent are paying down balances. An estimated 5.4 million borrowers have at least one student loan account past due.

 

Roughly 85 percent of outstanding student loan debt is owed to the federal government. The remaining 15 percent that's counted as private student debt is owed to various non-federal lenders, ranging from banks to loan companies like Sallie Mae Corp. to non-profits and state-affiliated agencies (under the Durbin bill, loans from any government-funded entity still wouldn't be dischargeable, only those from truly private lenders).

 

Generally, it's these private loans that bring borrowers to the door of bankruptcy lawyers like Barrett. Private student loans often lack the protections of federal ones, and have rates that typically start higher and can shoot up. A recent survey of bankruptcy attorneys found 81 percent reporting more clients with student debt in recent years, and roughly half reporting a significant increase.

And, also by way of background to those unfamiliar, student debt has a very peculiar feature:

Virtually any other kind of debt — including medical bills, mortgage, credit cards and car loans, even gambling losses— can be discharged in bankruptcy, allowing the "honest but unlucky" a chance to restore their footing through an arduous restructuring overseen by a court. 

 

But under a 2005 law passed by Congress to protect lenders, private student loans fall under the same nearly-impossible-to-clear category as child support payments and criminal fines.

 

"It's a huge part of why the younger generations are here now," said the Stangs' bankruptcy lawyer, Matthew Barrett, whose busy office in Amherst, west of Cleveland, belies stories about the improving economy. He estimates half his clients have problems with student debt.

It is very ironic is that despite all the rhetoric, the president has said absolutely nothing about mitigating this particular provision of bankruptcy law: the one which makes student debt the most expensive form of payment: one which is literally like the proverbial gift that keeps on giving. Or in this case taking.

To advocates for student borrowers, the law is infuriating, counter-productive and — if intended to ensure lenders would be willing to make loans to students— demonstrably unnecessary. They see changing it as among the most effective, and least costly, ways to help those most seriously burdened by student debt, without giving a break to those for whom it's manageable.

 

Yet despite a voluble national conversation on student debt, the issue has gotten comparatively little attention.

 

At stops in three swing states this week, President Barack Obama is calling on Congress to head off a scheduled doubling in federal Stafford loan rates, from 3.4 percent to 6.8 percent. Changing that law could save more than 7 million new borrowers on average $1,000 a year, according to the White House. But this across-the-board benefit for current college students would do nothing for older borrowers already in trouble.

 

Acting without Congress, the Obama administration has implemented a series of protections for those pressed to pay back federal loans, such as income-based repayment and a public-service loan forgiveness program — steps lauded by advocates for borrowers.

 

However, the president appears never to have directly addressed a proposal by Sen. Richard Durbin, D-Illinois, to overturn the 2005 law on private loans. Treasury Secretary Timothy Geithner recently told Durbin the dischargeability proposal had "some merit" and that the administration wanted to work with him to expand the protections it has implemented for federal student loans into the private market. Regardless, the bill has little chance of passing the divided Congress in an election year.

Which brings us to the topic at hand: case study A.

The misfortunes that brought schoolteachers Devin and Sarah Stang and their four young children to bankruptcy — and the loss of their house and a car in the process — were their own unique story.

 

They bought the house at just the wrong time. There were heavy medical expenses when, at five months pregnant, she delivered stillborn twins. And their money woes go back further: When Sarah's college softball team pressured her to drop classes she wanted to take, she quit, lost her scholarship and had to make up the difference with loans. Devin, too, borrowed to get a master's degree. Then they struggled amid school layoffs near their Sandusky, Ohio, home.

 

Now, the Stangs just want a truly clean slate, financially. But even the ordeal of bankruptcy won't give it to them, and the reason is a common one: Much of their debt comes from private student loans.

...Which as noted above, will virtually never go away. So who is the biggest winner? Why bankruptcy lawyers of course, who as it so happens all the time, do nothing but provide false hope...

Generally, it's these private loans that bring borrowers to the door of bankruptcy lawyers like Barrett. Private student loans often lack the protections of federal ones, and have rates that typically start higher and can shoot up. A recent survey of bankruptcy attorneys found 81 percent reporting more clients with student debt in recent years, and roughly half reporting a significant increase.

 

Barrett says he's seeing more recent college graduates who couldn't get a job after graduation or who, if they did, faced garnishment of entry-level wages.

 

Before the 2005 law passed, lenders would "try to work with (borrowers) on a payment plan," Barrett says. "They had the threat, if we don't make it so this person can afford to live and eat and get to work and dress for work, then they're going to file for a bankruptcy plan and we're going to get hit.

 

"Now, they'll hit you with a garnishment — and if you can't make ends meet, tough."

 

Private lenders haven't always enjoyed a spot at the front of the line of bankruptcy creditors.

It wasn't always like that:

Private lenders haven't always enjoyed a spot at the front of the line of bankruptcy creditors.

Until 1976, all education loans were dischargeable in bankruptcy. That year Congress began requiring borrowers to wait at least five years before they could discharge federal student loans. Since 1998, borrowers have been unable ever to discharge federal student loans, and in 2005 the then-Republican-controlled Congress made private loans almost impossible to discharge. Essentially, borrowers must prove they can't repay and will never be able to, but the standard is vague. And litigating in bankruptcy court may be impossible financially for someone in those circumstances.

 

With federal loans, the concern was that making it too easy to walk away from debts would put taxpayer dollars at risk.

 

With private loans, the lender protections were justified by fears that otherwise lenders wouldn't extend students the capital they needed to cover tuition bills. Student loans offer no security or collateral. Lenders are betting on a borrower's education to produce future earnings. Put differently, a bank can repossess your car but not your brain.

 

Changing the law "would force our members to raise borrower rates or elevate their already strict underwriting standards and essentially make it harder to make the loans," said a spokeswoman for the Education Finance Council, which represents nonprofit and state-based providers of non-federal loans, in a statement issued on behalf of president Vince Sampson. A Moody's report also suggested younger student borrowers might be especially tempted by an easier bankruptcy filing, not appreciating the long-term credit damage.

 

But such arguments swim upstream against a lot of historical data.

 

Before 1976, when student loans were dischargeable in bankruptcy, there's little evidence borrowers abused the practice. A federal study from that time estimated less than 1 percent of all matured student loans were discharged in bankruptcy.

Of course, before 1976 there was not 30 years of excessive easing resulting in unprecedented dislocation from fair value for all asset prices, driven purely by nothing but cheap money, and people access to it.

Which brings us back to the Stangs:

"I wasn't raised to say, 'I'll go file bankruptcy,'" said Devin Stang, who is 41. The family's student debt totals $25,000 in federal loans and about $37,000 in private ones, much of it from taking required continuing education credits to keep up their teaching licenses and job prospects at a time of widespread layoffs.

 

Surrendering one of their two cars in bankruptcy will limit the Stangs' work options, Barrett says. And digging out will be even harder because, even after their other debts are clear, the private student lenders could garnishee up to 25 percent of wages.

 

If they could discharge their private loans in the same manner as credit card debts, "away we'd go on our lives," Stang said.

 

There's also little evidence that changing the law would affect the availability of private student loans. In fact, private student lending was expanding rapidly before 2005, when the loans were dischargeable. Then Congress awarded lenders stronger collection powers — but private student lending fell by two-thirds in just a few years, coinciding with the broader credit crunch.

 

A leading financial aid expert, Mark Kantrowitz of the website Finaid.org, doesn't buy the lenders' argument. He says changing the law might slightly increase fees, but lenders make their decisions based on credit scores and macro-economic factors.

Of course, one can say that one has to live the consequences of one's actions, and it is not like the Stangs did not make a mistake. But then the argument would also migrate to the consequences of pervasive bank failures and the fact that unlike the Stangs, banks did get preferential terms for all their losses and shortfalls. And of course that would be true.

And at the end of the day, America has always been about second chances. Perhaps the Stangs, and all those others who took a bet on their biggest asset: themselves, and failed the first time around, deserve a second chance?

Even if changing the law did make private loans disappear, some advocates think that wouldn't be so bad.

 

In fact, new lending has already fallen sharply recently, and it hasn't kept people out of college; enrollment is way up. Students who might have gotten private loans five years ago, but can't now, are apparently choosing less expensive schools or borrowing more of what they need from the federal government, which accounts for more than 90 percent of new loan volume now.

 

A study by the Project on Student Debt, a foundation-supported research group, found that half of students who took out private loans in 2007-2008 failed to borrow their maximum eligibility in federal Stafford loans. Those students could have — and almost certainly should have — borrowed more from Washington first (undergraduates can cumulatively borrow up to $31,000 in federal Stafford loans, and in some cases, as much as $57,500). Now, they're doing so.

Yet nothing will happen. Why? Because that ultimate enabler of the status quo - America's higher learning system itself, is dependent on perpetuating the status quo. Because if loans are harder to come by, college tuitions would tumble, and the very fabric holding the lie that is modern socio-economic surreality, would implode:

Finally, if the spigot of private loans cut off, it might temper college cost increases. Colleges would find it harder to get away with charging more than what students can borrow from the government.

Indeed one can dream... Or return to reality, where unfortunately nothing changes, and millions and millions of Americans are converted each year into that most sublime form of debt slave: the one that can't just pick up and walk away from it all. The very definition of slavery.

"There's a special circle of bankruptcy hell for these kinds of debts," said Rich Williams, higher education advocate with the group US PIRG, which lobbies on student loan issues. "It's not that students are asking for extra protections. We're asking for the same protections entitled to every other form of consumer debt."

And so it continues in the once great USA, where countless people are converted not only into perpetual debt slaves but have to brave the various circles of debt hell simply to comply with a self-image imposed on them by a superficial society that demands one buys stuff one doesn't need, with money one doesn't have to impress people one doesn't like.

Truly the American dream, pardon nightmare, lives on.

 

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Thu, 04/26/2012 - 18:28 | 2378406 Thunder_Downunder
Thunder_Downunder's picture

Pretty crazy rate of interest (6.8%) for a debt that cannot be discharged... Not exactly free market pricing, more like bottom feeding...

 

...aside from the immorality associated with the concept of undischargeable debt.

 

 

Thu, 04/26/2012 - 18:27 | 2378409 skipjack
skipjack's picture

When I graduated from Duke University(many moons ago), my tuition room and board were approx. $4500 for my senior year, engineering school.  I paid for that degree with landscaping jobs in the summertime, and working in the bookstore during the school year.  Is there any job a 20 year old can do to do the same thing I and all of my contemporaries did 40 years ago ?  Full ride at Duke these days is close to 60k per year - it's impossible.  Tuition/board need to be cut by 90% to be affordable in the same way as it was for me.

 

  It's disgusting what schools are doing, and they all deserve to fail.

Thu, 04/26/2012 - 18:38 | 2378447 Bob Sacamano
Bob Sacamano's picture

It would seem to me if you can not afford to go to Duke, you may want to consider not going to Duke.   But that's just me. 

Thu, 04/26/2012 - 18:54 | 2378494 Svener
Svener's picture

Yes there is. Not much different from when you trackers.

Thu, 04/26/2012 - 19:17 | 2378556 BORT
BORT's picture

 

Wednesday, November 2, 2011

 

From 1975 to 2005, the cost of attending public universities in the U.S. tripled. Benjamin Ginsberg argues that much of the increased cost can be attributed to administrative bloat.

Since the 1970s, Ginsberg notes, the number of administrative staffers has risen  by 235 percent, while the number of faculty and students has increased by only about 50 percent.

Some administrators do so little that they “could be kidnapped by space aliens and it would be weeks or even months before his or her absence from campus was noticed,” Ginsberg writes.

He also says the increase in administrators is taking universities away from their fundamental academic purpose, and doing students a disservice.

 

Benjamin Ginsberg

Benjamin Ginsberg , Ph.D. is the David Bernstein Professor of Political Science, is Chair of Governmental Studies and the Center for Advanced Governmental Studies of Advanced Academic Programs at Johns Hopkins University. He is the author of numerous books on American government and politics including: Downsizing Democracy, The Fatal Embrace; Embattled Democracy; Democrats Return to Power; Politics by Other Means, The Captive Public; Do Elections Matter?; American Government: Freedom and Power; The Consequences of Consent; and Poliscide. Most recently, Ginsberg has authored The American Lie: Government by the People and other Political Fables, and co-authored Presidential Power: Unchecked and Unbalanced. The textbook he co-authors with Theodore J. Lowi is the most widely used American government textbook in the country.

Thu, 04/26/2012 - 18:34 | 2378427 Spigot
Spigot's picture

I put 4 years of my life into the US military in exchange for 4 years of college tuition. Went to a school that was good, but not 5 figure annual tuition. Got my B. I would advise any well young person to consider that as a course. Also got a 2 yr equiv training in technology field while in. so, almost a two-fer.

Thu, 04/26/2012 - 20:13 | 2378706 dolph9
dolph9's picture

Yeah, volunteer for a massive bureaucracy that either sends you to the desert halfway across the world to lose your arms or your mind defending Israel, Halliburton, and Goldman Sachs, and, if you manage to come back in one piece, tries to do its best to send you back out again.

Real smart.

Thu, 04/26/2012 - 21:45 | 2378925 sof_hannibal
sof_hannibal's picture

show me other options... ok, just put me on welfare... the factories are closed... the student loans make you debt slaves... mc donalds ain't no way to support a family... so... construction is done...

don't blame the masses who join (the military) to better themselves... this is largely due to lack of options; they maybe blind sided with other BS-- like believing in some greater cause, but it comes down to one thing $$$ money...

they break the system... and that's the only option for some people... I guess, just put them on welfare... anyway less than one percent of the population serve... I am doctor in the military, I did it because of money $$$... and don't tell me I shouldn't want/ deserve a good education...
I am far smarter than those like G.W. Bush... he gets to go to Yale, high on coke-- why? because he was born into the right family... and my IQ can run circles around him, but it's junior college and basket weaving degree for me... fuck that... nepotism... Show me the options... military service will pay for your degree... you don't need to be a trust fund baby to equal the playing field.

Thu, 04/26/2012 - 21:37 | 2378908 sof_hannibal
sof_hannibal's picture

spigot-- that is one reason I believe in military service... however it may be: the wars are a joke, the generals are clueless, the senators are even more clueless, and american patriotism is a lie...

BUT show me another organization like the military in the US that gives kids/ adults a chance to better themselves and earn their keep (without nepotism; without having a genious IQ; a sports scholarship; or a perfect family life, etc.)... there are many pitfalls to stay trapped (in the service and end up a PTSD disability write off), but the path is clear to some extent (to use the system wisely)... do some time, build a resume, get some training, learn how not be a little whiny bitch, and get the GI bill... use the BI bill to improve your lot in life and so on..

there isn't (there is no other organization like it in the US); and quite frankly, the military isn't for everybody... the US needs more organizations -- where we can invest in the younger generations... pay for play... invest in the future... ain't gonna happen, but worth the thought...

Thu, 04/26/2012 - 22:57 | 2379085 Spigot
Spigot's picture

It helped me become an adult, learn discipline, deal with authority, work at things and with people that were disagreeable, etc. I agree with what you have written. And, yes, the assholes like Halliburton and the oil oligarchy suck. But as you say, nothing like a few years in the .MIL to round out a life.

Thu, 04/26/2012 - 18:35 | 2378434 GeorgeNY
GeorgeNY's picture

The oligarchs have won. Not a single post here even thinks about the possibility that we would want to have an educated population for reasons other than merely "creating workers." It all veers from sanctimonious bullshit to smug self-satisfaction I might say schadenfreude but would probably be called a Nazi. Basically everyine thinks that college is just trade school with frats. We have entirely bought into the system nothing has value unless it can be sold in a market. Survival is the baseline and everything else is merely luxury meant for only the deserving rich or elites. You are all pawns and in your deification of the market are really the ones who have lost your freedom. 

The problem is not the loans. the problem is that it costs $50-60,000 a year at a private institution to get a degree.Snigger all you want but there IS a value to education that promote the public good beyond merely providing workers for industry. 

You fault these young kids for pursuing soemthing which they are told will help them in the long run? Where all around them it appears that people with educations are better off than those without (Of course 20 years ago the costs were a fraction of what they are now).

What are they to dream about? What are they to reach for? To smugly sit back and watch everyone else fail? What should they train to do? Let me guess? They should do exactly what you did becuase you all were so freaking prescient that you knew at 16 or 17 the future of the word economy and your place in it for the next 50 years.

Oh and for the record. I went to an elite school. I was smarter than everyone else in my class in hhigh chool and got into the best school I could. My father was a steelworker and we managed to pay for all of it including graduate school. Yes I had loans but back then it was not too bad. And yes my life is better for it. I could sit back and be the angry bastard talking about hw dumb kids are today and no one takes respopnsibility like I did and yadayada. But you know what pisses me off is that I can see that had I been born today I would never have had those chances. I would never have been able to have done what I do now. How is that fair to this generation? How does that make this a better country?

Thu, 04/26/2012 - 18:53 | 2378495 Thunder_Downunder
Thunder_Downunder's picture

Crazy huh?

 

How did people get so spun around in their thinking... nothing more pitiful than the slave that binds himself...

Thu, 04/26/2012 - 20:01 | 2378673 Lednbrass
Lednbrass's picture

I dont see many saying it a trade school with frats. Trade school grads get jobs they can actually make a living on.  My kid wants to go to college for engineering, Im trying to convince him to go to a 2 year school and get certified as a machinist or welder first so he has an actual saleable skill first that he can at least partially work his way through on and make half decent money.

While I agree that the cost has gotten ridiculous and its not possible to work your way through as I and many others did (at least not as quickly) I have no sympathy for Victim Studies majors or some of the other high priced and useless majors out there. There are people who spend their lives in school and dont come out until their late 20's with advanced degrees in utterly useless bullshit without ever having worked a job, I just cant feel sorry for them.

They make a choice and have to deal with the consequences. Advanced education is not a right.

Fri, 04/27/2012 - 08:25 | 2379646 Catullus
Catullus's picture

The loans are causing tuition to go up. Maybe you can have the professors driving the M3s in the parking lot of Whole Foods explain how the student loans made their lifestyles more affordable.

Or maybe that professor can tell you why he/she commands a salary and pension greater than your steelworker father.

Thu, 04/26/2012 - 18:35 | 2378435 GeorgeNY
GeorgeNY's picture

The oligarchs have won. Not a single post here even thinks about the possibility that we would want to have an educated population for reasons other than merely "creating workers." It all veers from sanctimonious bullshit to smug self-satisfaction I might say schadenfreude but would probably be called a Nazi. Basically everyine thinks that college is just trade school with frats. We have entirely bought into the system nothing has value unless it can be sold in a market. Survival is the baseline and everything else is merely luxury meant for only the deserving rich or elites. You are all pawns and in your deification of the market are really the ones who have lost your freedom. 

The problem is not the loans. the problem is that it costs $50-60,000 a year at a private institution to get a degree.Snigger all you want but there IS a value to education that promote the public good beyond merely providing workers for industry. 

You fault these young kids for pursuing soemthing which they are told will help them in the long run? Where all around them it appears that people with educations are better off than those without (Of course 20 years ago the costs were a fraction of what they are now).

What are they to dream about? What are they to reach for? To smugly sit back and watch everyone else fail? What should they train to do? Let me guess? They should do exactly what you did becuase you all were so freaking prescient that you knew at 16 or 17 the future of the word economy and your place in it for the next 50 years.

Oh and for the record. I went to an elite school. I was smarter than everyone else in my class in hhigh chool and got into the best school I could. My father was a steelworker and we managed to pay for all of it including graduate school. Yes I had loans but back then it was not too bad. And yes my life is better for it. I could sit back and be the angry bastard talking about hw dumb kids are today and no one takes respopnsibility like I did and yadayada. But you know what pisses me off is that I can see that had I been born today I would never have had those chances. I would never have been able to have done what I do now. How is that fair to this generation? How does that make this a better country?

Thu, 04/26/2012 - 18:43 | 2378461 Spigot
Spigot's picture

So, you were born in a place and time where this opportunity to an good education, and a father's union pay could put you through school. So, you did. And it worked for you.

And today's student does not live in such a world. But they are trying to pretend that they do, much to their own detriment.

An education does not always come from a class room. Books and online materials abound. The only thing needed is the application of one's attention. And these things are virtually free.

The extention of childhood is not well rewarded these days.

Thu, 04/26/2012 - 19:06 | 2378525 GeorgeNY
GeorgeNY's picture

Bravo on your embrace of the change you see around you.

I am sure that you will find a way to dominate those who were not as smart as you and not able to "do it themselves."

You have no idea what I am talking about. 

 

 

 

Thu, 04/26/2012 - 19:42 | 2378621 maggiemayok
maggiemayok's picture

I have a fancy degree and am real smart... I done lots of gubment reports for folks in uniforms about the costs of fixing military equipment.  I even told people in a five sided building somewhere east of here that cost overruns could be tracked and curtailed, uh, I mean, kertaled. 

I still prefer my kid shoe horses for a living. 

Thu, 04/26/2012 - 20:09 | 2378697 Lednbrass
Lednbrass's picture

Oh I suspect he gets you quite clearly. You dont seem to think its possible that you can be understood and disagreed with, this is an error.

He is quite correct that much in terms of general education can be found for free.  I didnt read Plato, Socrates, Nietzsche, Shakespeare, etc. and a ton of other works considered classics because they were assigned in school (well, a little Shakespeare was), I read them because I was curious and they are all considered great minds. You dont necessarily need a professor for that.

Thu, 04/26/2012 - 21:22 | 2378884 sof_hannibal
sof_hannibal's picture

Lednbrass, great, read the classics, but then what? How does one pay the bills? Conversely, here is a quote… the moral is, don’t believe the hype… and the reality is— that's all the younger generations has (is hype, a gutted, joke, service economy, rotting cities, like Detriot, hot air (derivatives), become a celeb on youtube, ship the slave labor to China, and then back to the US eventually-- disagree and end up in the gulag)… welcome to the moder world...

Personally, I don’t blame them, they came up in a broken system… that is going to get worse… we should just all be in finance, maybe? Funny money for everybody:

“You keep it going man, you keep those books rolling,

You pick up those books your going to read
And not remember and you roll man.
You get that a sociate degree, okay,
Then you get your bachelors, then you get your masters
Then you get your master's masters,
Then you get your doctron,
You go man, then when everybody says quit
You show them those degree man, when
Everybody says hey, your not working,
Your not making in money,
You say look at my degrees and you look at my life,
Yeah i'm 52, so what, hate all you want,
But i'm smart, i'm so smart, and i'm in school,
And these guys are out here making
Money all these ways, and i'm spended mine to be smart.
You know why?
Because when i die, buddy, you know
What going to keep me warm, that right, those degrees…”

-Kayne West (that narcissistic mother fucker is richer than you, and he probably didn’t read the classics, are you jealous?)… gay fish sticks, bitches…

Thu, 04/26/2012 - 23:06 | 2379107 Spigot
Spigot's picture

George, your projection of liberal angst is impressive. No where did I say I was into "dominating" anyone, that's coming from inside the cesspool of you mind, dude. I take a more wholistic view: its the god damn environment you live in. Use your own head. Stop believing lies. If you find you got screwed because you believed in lies...stop believing in lies. If you find your self being driven off of a cliff in a school bus with all your friends, dude you'd better bail NOW. You're a fucking adult. Make your own choices. If you chose to stay on the school bus then you are going over the side.

And whatever choices we make we can all still figure out how to do things differently

Thu, 04/26/2012 - 21:09 | 2378856 sof_hannibal
sof_hannibal's picture

I agree with you, but there's an exception…

Spigot, it's fine that you figured out the game (as did I-- I could say honestly it was because I am so insightful keen/ hardworking/ or I could say it is because I got lucky/ or probably it's a little of both); but there are so many others (especially the younger generations-- who are just being played... I think it's heartless to except that they should be so cynical of system/ environment/ country/ world-- that largely is fucked, and not because of them (or not yet anyway)... that is [the current system] is fucking them back to feudalism and peasantry (end result if we go all out no gov); or complete communism/ corporate socialism-- if we stay on this path)...

garbage in/ garbage out; as they say... have fun blaming it on lack of morals and single parent households... and drugs

Thu, 04/26/2012 - 20:59 | 2378832 sof_hannibal
sof_hannibal's picture

get rich or dying trying... I picture a snaking eating it's tail... or as someone commented here on ZH recently-- in ref. to the lack of retail invesors-- the system for whatever reason is killing the host...

there will be nothing left for the parasites eventually...human nature, survival of the fittest until be all we all go up in smoke?

Thu, 04/26/2012 - 18:37 | 2378440 Spigot
Spigot's picture

The #1 screw up that freshman collegiate students do, which destroys their education path, is take on credit card debt. 40-50% drop out within the first year due to crushing credit cards debt payments.

But I suppose that could be called an education.

Thu, 04/26/2012 - 18:37 | 2378444 Diet Coke and F...
Diet Coke and Floozies's picture

Dudes, WTF happened to your country?

Thu, 04/26/2012 - 18:45 | 2378467 Spigot
Spigot's picture

It changed, like everything else. The present and future belong to the learners.

Thu, 04/26/2012 - 19:05 | 2378523 BORT
BORT's picture

Entropy is a Bitch

Thu, 04/26/2012 - 18:39 | 2378450 GrinandBearit
GrinandBearit's picture

There are plenty of ways to screw these banks/banksters... but you gotta have a plan. 

Credit cards can purchase lots of white and yellow barbarous rocks.  After that you can float the debt for 1-2 years using balance transfers to 0% interest CCs.  

There are other things I am doing, but I do not want to blow my cover -lol

Thu, 04/26/2012 - 18:44 | 2378465 lemonobrien
lemonobrien's picture

i don't think any of these students should get relief; i paid off my student loans with no help. make them do chain gain labor at minimum wage. they were stupid enough to pay for a degree in art history/english lit expecting a real job afterwards.

Thu, 04/26/2012 - 19:14 | 2378544 1eyedman
1eyedman's picture

its not about the current batch..its the future borrowers.   lenders should not get favored status of non-dischargeable loans that will be insured by the fed govt.  

the problem is lenders/banks get to lend, have the loans gauranteed by the govt, and never face a writeoff due to b/k.  if they are non-recourse and govt backed, the rates should be like t-bills.

they should not be govt gauranteed and lenders should lend at mkt rate and be just the same as all other consumer debt. the law, as usual, is being written to the benefit of banks at the expense of taxpayers and risk borne by borrowers.

Thu, 04/26/2012 - 19:43 | 2378622 lemonobrien
lemonobrien's picture

people are going to school b/c there are no jobs; and the for profit schools (DEvry/Phonix) are robbing the system blind.

 

stop student aid, and watch the price of college plummet in a couple of years, due to lack of students.

Thu, 04/26/2012 - 19:23 | 2378577 Vince Clortho
Vince Clortho's picture

I paid off all my student loans too.

Cost of going to college today is outrageous.

Don't blame the kid who are trying to succeed.

Focus on the parasitic leeches that structured this whole freaking abomination.

 

Thu, 04/26/2012 - 18:50 | 2378481 Svener
Svener's picture

Simple don't borrow so much. Graduated three years ago (5) yrs of college. Worked all the way through, didn't buy anything unnecessary. Graduated with 17k in debt; will be paid off early next year. I saw the way so many borrowed to the hilt and did not even try to be frugal. Then they complain about poor me and my terrible student loans. No, party less and work more. I know it can be done, I did it

Thu, 04/26/2012 - 18:59 | 2378507 dwdollar
dwdollar's picture

What's your degree and where do you work? Just curious.

Thu, 04/26/2012 - 19:00 | 2378512 Atomizer
Atomizer's picture

If you Bitchez's decide to withhold tuition payment, we'll just withhold your pension/Social Security obligations from you. If you really want to play hardball with us.... We'll just add a predetermined surcharge to your free health care plan.

Oh the irony. How about just paying your fucking bills and live within your means. My first wife was up to her eyeballs in student loan debt. What does she do? Embezzled from her employer. The funny part, she did it twice and landed in prison for a long time. Have no idea of she stills owes on her student loan, but I think she is still paying off both employers. She still owes me $36K in child support.

True story.

 

Thu, 04/26/2012 - 22:54 | 2379081 JLee2027
JLee2027's picture

Why in the world do you want to enslave someone in child support?  And that's what it is - involuntary indentured servitude that never ends.  You have a choice. You can accept partial payment, have them pay something else (like college tuition), or forgive it.  Why do you want to her in "control" because that's what it is - you are the master making her a slave.  She went under so much money pressure she broke the law?  That's evil and you are part of it - and also responsible. 

Don't you understand that the draconion child support system has nothing to do with the children and everything to do with destroying families and creating slaves?  You should thank God every day you never saw the other side.

 

 

 

Thu, 04/26/2012 - 19:04 | 2378521 BORT
BORT's picture

The real visibility on this issue comes, (as it did with Housing with resets of Arm's) in about 4-5 years after the ramp up in student loans.  So this fall, when the 2008 entrant has exhausted their 6 month grace period; that payments have to commence.  What else hits at the same time, election, debt ceiling increase, etc. etc.  The hell with the ides of March, Beware the ides of October.  (Hunt for Red October??)

Thu, 04/26/2012 - 19:07 | 2378529 bozzor
bozzor's picture

In a few years, MIT's initiative should take a huge chunk out of education expenses - depending on how employers view the certification procedure. But it looks fairly promising at this early stage...

http://mitx.mit.edu/

Thu, 04/26/2012 - 19:07 | 2378530 dwdollar
dwdollar's picture

Some of these comments are down right idiotic.

Obama is going to forgive 1 Trillion in student debt and buy his votes?

Give me a fucking break. First of all, he doesn't have to buy any votes. His masters make them up and they decide who 'wins' and who 'loses'. Secondly, to liberate someone from debt is to effectively grant them more freedom. How much freedom has been granted to any American lately?

Thu, 04/26/2012 - 19:19 | 2378566 economicmorphine
economicmorphine's picture

Obama doesn't have to buy votes, but I'm pretty sure he doesn't know that.

Thu, 04/26/2012 - 19:07 | 2378531 babylon15
babylon15's picture

Most of these students were naive and didn't understand the amount of money they were borrowing.  Indeed, many of them were lied to about the economy - "the economy is bad but you're not average, you'll find a good job if you go to a good school" they were often told.  Well, it was a lie.  For most people who went to college after 2002, a degree was not a good investment.

But, it's in your personal interests to protect them rather than blame them.  Politicians will surely capitalize on youth's frustration with a system that has totally failed them.  Look at France, the young people overwhelming voted for a totalitarian extremist who came in 3rd and wanted a 100% tax rate on income above 300k.

People have to protect the weak and vulnerable to prevent evil from becoming strong. The Hitlers of the world come to power because they divide and conquer.  These young people are trying hard to be part of the middle class and it's not happening.  So you can get angry at them, and blame them, or you can realize that you are actually a have, not a have not, and do something to make a better system.

Thu, 04/26/2012 - 19:30 | 2378584 economicmorphine
economicmorphine's picture

-

Thu, 04/26/2012 - 19:19 | 2378563 Vince Clortho
Vince Clortho's picture

I'm going back to school.

Thu, 04/26/2012 - 21:09 | 2378858 dark pools of soros
dark pools of soros's picture

where the pussy is still young and dumb

Thu, 04/26/2012 - 21:53 | 2378946 sof_hannibal
sof_hannibal's picture

hell yeah... college pussy all around, while the world ends in a slow painful death... love it... party like a rock star

Thu, 04/26/2012 - 19:19 | 2378565 yogibear
yogibear's picture

Total (Tuition, books, dorm, etc) college costs have jumped to over $25,000/yr at some state colleges. Watch the debt slavery increase now. Either the very poor/illegals get a free college education or very wealthy can afford one now. 

 

 

 

Thu, 04/26/2012 - 19:29 | 2378585 bankonzhongguo
bankonzhongguo's picture

Here's a "solution."

Next time you get a collection letter or lawsuit on your debt, make a note of who exactly is handling the matter - as in the name and location of the collection agent or lawyer giving you a hard time.  Ask to meet with them face to face.

Rather than paying legal fees to extend and pretend, search these specific people out and shoot them twice in the head at close range.  You can do it at their home or office.  Try to do it without getting caught.  If you have a terminal medical condition and they are still chasing you for medical debt, give of yourself and take a few out on behalf of the rest of humanity.  Besides, you'll get better medical treatment in jail than by your wits on the street.

After a few hundred of these types of people are made news at 11, things might change.

Good luck to everybody.

 

Thu, 04/26/2012 - 19:31 | 2378592 economicmorphine
economicmorphine's picture

If a few hundred of these types of people made the news at 11, we'd be building debtors prisons.  I'm all for your idea.  It would put people to work and get deadbeats off the streets.

Thu, 04/26/2012 - 20:52 | 2378799 Zgangsta
Zgangsta's picture
THE MAN
Fact of the matter, Muley, after
what them dusters done to the land,
the tenant system don't work no more.
It don't even break even, much less
show a profit. One man on a tractor
can handle twelve or fourteen of
these places. You just pay him a
wage and take *all* the crop.

MULEY
But we couldn't *do* on any less'n
what our share is now.
(Looking around)
The chillun ain't gettin' enough to
eat as it is, and they're so ragged
we'd be shamed if ever'body else's
chillun wasn't the same way.

THE MAN
(irritably)
I can't help that. All I know is I
got my orders. They told me to tell
you you got to get off, and that's
what I'm telling you.

Muley stands in anger. The two younger men pattern after
him.

MULEY
You mean get off my own land?

THE MAN
Now don't go blaming me. It ain't
*my* fault.

SON
Whose fault is it?

THE MAN
You know who owns the land--the
Shawnee Land and Cattle Company.

MULEY
Who's the Shawnee Land and Cattle
Comp'ny?

THE MAN
It ain't nobody. It's a company.

SON
They got a pres'dent, ain't they?
They got somebody that knows what a
shotgun's for, ain't they?

THE MAN
But it ain't *his* fault, because
the *bank* tells him what to do.

SON
(angrily)
All right. Where's the bank?

THE MAN
(fretfully)
Tulsa. But what's the use of picking
on him? He ain't anything but the
manager, and half crazy hisself,
trying to keep up with his orders
from the east!

MULEY
(bewildered)
Then who *do* we shoot?

THE MAN
(stepping on the
starter)
Brother, I don't know. If I did I'd
tell you. But I just don't know
*who's* to blame!
Thu, 04/26/2012 - 19:30 | 2378590 Rockmann
Rockmann's picture

Parents are just as at fault in some respects. Student loans always amount to way more than what is required, so the students get a "rebate" for a spring break fling or who knows what else. My friends daughter received a refund check for $3,200 and she blew it within a couple of weeks. This is on top of the other checks she has received the previous four years which probably amount to $10-15K Problem with the "rebates" they give you, if you try to put it back on the loan, then the student loan payments start at the point you start making payments.

I started making payments when I received the first statement when my daughter was a Freshmen, even though I was not required to do so. No interest accrued as I always made more than the interest and added to principle. I made sure all rebate checks were put back on the loans as they were sent to me and not her, to reduce the principle. After 4 years she owed $24K, whereas her friends were $50K+ 

The other "fun" thing is that parents have to personally sign and screw their credit if the kid doesn't pay. I have six dings on my credit report because of a single late payment on my daughters loans that she failed to make after graduation. Since they were six seperate loans, but lumped into one payment, they all get reported as seperate late payments. Banks win here because late payments screw your FICO so they can nail you for even more. I took over the payments for my daughter so I don't have to go through that nightmare again.

So lesson learned here for parents:

  • Start making payments early on the student loan to keep the interest from accruing
  • Put all rebate checks back into the loan and tell your kid its not free money 
  • If you signed as a parent, make the payments yourself or your credit will be screwed
  • Educate them on the cost of the loans and credit card debt (credit cards are given out like candy at colleges) 

Best of luck to you young parents, this is going to be a nightmare for both you and your kids. Especially when they get out of school and can't find a job. 

 

 

 

Thu, 04/26/2012 - 21:13 | 2378867 dark pools of soros
dark pools of soros's picture

I take it you don't let her watch the Kardashians

Thu, 04/26/2012 - 21:56 | 2378951 sof_hannibal
sof_hannibal's picture

Kim Kardashian = such a hard working, business genius; if only I could be half as smart and half as hardworking... maybe I wouldn't have so much student debt (insert SARC)... I just want to be famous and competent... for NOTHING and at NOTHING... bling bling, get paid.

Thu, 04/26/2012 - 19:33 | 2378599 theTribster
theTribster's picture

He doesn't plan on fixing anything unless he can get massive political mileage from it and even then it is likely a lie or misrepresentation of reality. The presidential, congressional and the judicial branch are all completely corrupt and unfunctional as it relates to actually doing 'the right' things - I don't think they could if they wanted to at this point.

Obama is the slickest lier I've ever seen, he makes Clinton look like an amatuer. I don't think he has said an honest thing since he took office, it is actually incredible that a president could lie as much as he does. Congress is no better and the supreme pinheads over at the judicial branch are using the Constitution as they toilet paper! 

As far as I'm concerned, prison for all 535, maybe a couple good ones (Paul, Kaptor) but not many. Rand Paul just voted for the 50billion to the oil companies in the form of subsidies, I don't like him regardless of his logic! The bottom line is that our entire governement needs to be fired and replaced pronto. After they are fired we should seize their assets and put each one through trial, guilty is treason of the highest order. Sentence execution should happen publicly except it isn't good for the kids to see.

The fact that he isn't addressing the core of the issue makes it pretty clear what his intentions are, use it for political gains then, in the end, after he is elected he will do the opposite and allow the banks to further screw our kids and ruin the future of the country.

Reading and writing this stuff makes my blood boil, they really should be in prison - all of them! (I'm not TOTALLY sure about Ron Paul, he was about as vocal as a blade of grass - he shows NO fight as can be evidenced through this campaign - Ron who?). Sure, blame the press but that isn't fair - he knew he would have to fight really hard to have any chance, instead he has sold everyone out to make sure his son is taken care of and not abused. Frankly, they probably threatened him...

Republicans = Democrats = Liers, Cheats, Theives and visa-vie illegal wars - Murderers. Scumbag pinheads. Nancy Pilosi went from a net worth in 2008 of 11 million to a net worth last year of 36 million. No wonder shw loves obama. This is a woman that can't articulate a complete sentence, has ZERO skills but is worth 36 million dollars! Her false teeth will likely fall out one day as she spews her venomous lies, hopefully in front of the whole country/world.

Thu, 04/26/2012 - 19:49 | 2378643 dark pools of soros
dark pools of soros's picture

Firing them will just lead to new puppets attached to the money strings

Usury will forever chain freedom

Thu, 04/26/2012 - 19:40 | 2378615 honestann
honestann's picture

End fiat money and fractional reserve practices... and this problem and hundreds of other problems instantly vanish.  POOF.

Thu, 04/26/2012 - 19:50 | 2378644 no cnbc cretin
no cnbc cretin's picture

Not that simple!

Thu, 04/26/2012 - 22:18 | 2379005 ebworthen
ebworthen's picture

You have a point.

Too much money sloshing around has artificially inflated the cost of everything, and we are selectively deflating sectors that have had all the blood squeezed out of them while continuing to inflate others.

 

Thu, 04/26/2012 - 19:43 | 2378624 dark pools of soros
dark pools of soros's picture

Screw the Stangs and the hope they rode in on.

Don't they know having a family is only for the privileged or the poor? They are now safely in one of those categories

Thu, 04/26/2012 - 19:46 | 2378629 economicmorphine
economicmorphine's picture

You don't have to play along, people.  You want to play along.  You want to believe in Santa Claus.  You want to believe that you can get through life studying and never working.  Hell, you're not content with one degree.  You keep getting more.  You collect them like baseball cards.  You sit across from a banker and an educator and they're selling you clear blue sky and you're lapping it up like honey from the hive.

You're terminally stupid and you deserve to get screwed. Really.  

College can't fix that.

Thu, 04/26/2012 - 19:45 | 2378630 SeanJKerrigan
Thu, 04/26/2012 - 20:02 | 2378651 sof_hannibal
sof_hannibal's picture

and here's my thought... every president since Nixon (not Carter, I guess), can go fuck themselves for ruining this country... this includes all of them... Obama = go fuck yourself; Mitt = you rich Mormon private equity mother fucker = you get drunk and have gay sex while high on crack... and be barred from the Mormon heaven 4 ever...

I don't care about/ or for social security, disability, Medical, Medicad, and so on (unemployment benefits = rewarded fort sitting on your ass [and watch what happens if/ when they stop some of these gov trasnfers at the end of summer-- I don't think they will-- we live in a well fare nation (corporate socialism for the rich bankers/ CEOs and min payouts to the most poor); placate the masses, so they don't rise up]);

but it is apparent to me that the US stopped investing in the younger generations a long time ago... bring back work programs (WPA/ conservation corps-- invest in the youth, before they (the jobless generations for young peoples) revolt and all these leaders (good riddance actually) are hanging from the gallows) = French revolution bitchez; and give out things like GI bills for stuff (service) other than serving in the military only; or the 8 people in the peace corps (JFK RIP)... Our society (US) comes down to basically 3 maximums = get lucky, get rich (be a celeb or invent the next hot app or when the lotto, etc.), be lucky, and you’re born rich, OR-- it's learned helplessness/ expect a free lunch from the gov...

Thu, 04/26/2012 - 19:55 | 2378632 sof_hannibal
sof_hannibal's picture

tip of the ice berg... one of the number one factors in social collapse is disenfranchised youth... you got the lower SES unable find jobs; and now the middle class with 100k loans for a poly sci degree can't find jobs either... utter chaos (I see coming)...

these young adults should invest in some guns, close their bank accounts, and go fuck up sallie mae... luckily for me, I sold my soul to my uncle sugar for my debt transfer some time ago... undergrad and grad paid for... I am pretty much miserable, but whatever, if you can't beat them, joining them, right? but I feel for the younger ones coming up (some of this is gen Y baby'ness/ entitlement; but a lot of it-- is not)... there just aren't that many career opportunities in the US outside of things like finance, computes, health care, waiting tables...

for instance, my sister graduated in 2008 from a 1st tier law school and makes next to nothing with 200k debt in loans (from under grad/ grad)... she was sold the American dream (a pack of lies). She isn't married, doesn't have kids-- i.e. debt slave... ashamed what we have done to not only the poor, but those trying to better themselves (in the middle SES to lower middle SES)... more bail outs for the rich, until this whole fucking charade collapses! haha -- DOW 20k

Thu, 04/26/2012 - 19:46 | 2378634 rsnoble
rsnoble's picture

US shit pit.

Thu, 04/26/2012 - 19:48 | 2378638 Haole
Haole's picture

Jeff Berwick (The Dollar Vigilante) has predicted the possibility of student debt may be forgiven in the future.

 

For commensurate service in the military.

 

An "offer" like that from a present or future "administration" wouldn't surprise me in the least.

Thu, 04/26/2012 - 19:59 | 2378666 dark pools of soros
dark pools of soros's picture

North Korea has so much worth emulating

Thu, 04/26/2012 - 19:48 | 2378640 no cnbc cretin
no cnbc cretin's picture

Why are people still going to college, when the jobs are gone? It's like a big stupid supertanker, it takes a long time to stop.

The higher education system is also rigged, and a scam NOW!. When I went to college, I was still able to work my way through, and pay in cash.

Everyone needs to wake up, and realize the world is changing. Resource depletion is the root cause to all of this. Ecomonies run on cheap oil, not paper money.

Thu, 04/26/2012 - 20:04 | 2378675 dark pools of soros
dark pools of soros's picture

Growth based economies fueled by debt money leads to over population and pissing away of resources

And now for the weather...

Thu, 04/26/2012 - 20:03 | 2378679 sof_hannibal
sof_hannibal's picture

but what is their alternative? go off the grid

Thu, 04/26/2012 - 20:00 | 2378670 alfred b.
alfred b.'s picture

 

    One could say that the US has got a 15.6 trillion student loan itself which they don't intend to repay ...unless of course they can and probably eventually will, manufacture a 60% debasement of its currency!!

     Gee ...thanks bernnke.

Thu, 04/26/2012 - 20:07 | 2378692 sof_hannibal
sof_hannibal's picture

Berneke, you nervous, anxious, fidgety, academic, dumb fuck, you have never worked a real job, or knows nothing about how the real world works = see you in hell… but, you know, he’s just a puppet… just like Obama, just like Mitt; please, don’t believe any of these front men/ women matter… if Bernak was assassinated tomorrow, they would just replace him with another clone, and another clone, and so on…

Thu, 04/26/2012 - 20:05 | 2378685 SoNH80
SoNH80's picture

I DON'T LIKE TO USE ALL CAPS-- BUT, THIS MESSAGE IS FOR YOUNG PEOPLE ENTERING COLLEGE THIS YEAR, OR IN THE NEXT FEW YEARS. DON'T BORROW A SINGLE DOLLAR FOR SCHOOL.  YES, EVEN FOR ENGINEERING (THE INDIANS, CANADIANS, AND CHINESE GO TO SCHOOL FOR FREE, BASICALLY, AND THEY COME HERE BY THE THOUSANDS TO WORK IN THAT FIELD.  DO YOU WANT TO BE HOBBLED BY $120-200k IN DEBT UNLIKE THEM?)  THE ECONOMY HAS SHIT THE BED, I REPEAT, DON'T BORROW A SINGLE DOLLAR IN STUDENT LOANS.

Thu, 04/26/2012 - 20:12 | 2378703 The trend is yo...
The trend is your friend's picture

The students that come here for their masters degree, or come to study medicine or engineering often pay in cash because they already have money.  They decide to stay because they like the lifestyle and way of life.  In the past few years though that trend is now changing and many are actually going back.  An education from here leads to a much higher quality of life in thier respective countries

Thu, 04/26/2012 - 20:22 | 2378732 SoNH80
SoNH80's picture

Glad to hear that a swell time was had by all, and lifestyle accoutrements provided for, but the party is over, and the host, Uncle Sam, has vomited all over himself and has collapsed in the corner.... and his girlfriend, Britannia, has torn her mini skirt and is zonked out on benzos, moaning about her lost car keys....

Thu, 04/26/2012 - 20:54 | 2378808 sof_hannibal
sof_hannibal's picture

it ain't over till it's over... a bucket of fiat for a loaf of bread

Thu, 04/26/2012 - 20:56 | 2378814 ebworthen
ebworthen's picture

Bravo.

You are right, students should not take out one dime of a loan.

Problem is, they and their Parents are sold the old lines about income and job security and that they will make so much money the loans won't be a problem.  Kind of like all the people who were sold homes or equity lines of credit and told that values would go up to the moon along with the economy.

Thu, 04/26/2012 - 20:06 | 2378690 The trend is yo...
The trend is your friend's picture

Unless your going to be a engineer, doctor, scientist.....don't bother going to college.  To take out 100k+ at schools like BU, NYU etc to study socialogy , psychology, history etc is an utter waste of money.  The next generation needs to work on critical thinking and realize that they should be self educating themselves.

Thu, 04/26/2012 - 20:35 | 2378753 SwingForce
SwingForce's picture

So instead of Titheing to a Church, the Feds will garnish 10% of these students paychecks IN PERTUITY. Since Interest, Late Charges, Special Fees will easily exceed 10%, it NEVER gets paid off. Is this what you want?

Thu, 04/26/2012 - 20:49 | 2378792 CURWAR2012
CURWAR2012's picture

And just think, loans are being taken out for provate ELEMENTARY school and HIGH school with the sales pitch that these students will get more "SCHOLARSHIPS" to "better" colleges.

"Thank you may I have another"

http://www.privatestudentloans.com/k-12-loans.php

Thu, 04/26/2012 - 20:52 | 2378797 hustler etiquette
hustler etiquette's picture

Before graduating high school I thought going to a large private unversity would lead to higher paying job opportunities.  Farking generational heist. I'm surviving the Diplomacaust.

Thu, 04/26/2012 - 20:58 | 2378825 ebworthen
ebworthen's picture

The only answer, after currency debasement and inflation, will be a debt jubilee.

This will come after the great war and millions have been dispensed of.

Meanwhile, bankers and government get their bonuses and pensions.

Thu, 04/26/2012 - 20:59 | 2378830 djsmps
djsmps's picture

I'm sorry...no sympathy here. I paid back my loan. If you can't pay back the average $23k, then maybe forego the new iPhones, iPads, and big screen TV's every year. If you can't pay back 23k, how can you ever think of buying a house?

Thu, 04/26/2012 - 21:08 | 2378851 Hyper Entropy
Hyper Entropy's picture

I paid off $115,000 in student loans in 5 years. It was on my mind almost everyday with the single purpose to pay it off as quickly as possible because I saw it as slavery. I took a big bite of the shit burger and did my period of indentured servitude. Now, it's all gone... 

 

BTW. I'm a licensed structural engineer.

Thu, 04/26/2012 - 21:13 | 2378869 SoNH80
SoNH80's picture

Smart.  Today, though, a young person relying on a highly-paid job to materialize right after graduation to pay down such loans would be risky in the extreme. Once you're on the deferment rat maze, things get hairy in a hurry.

Thu, 04/26/2012 - 21:23 | 2378886 Miffed Microbio...
Miffed Microbiologist's picture

Sarah honey, we need to have a talk. First of all you were pregnant with twins with 4 young children. Ok, now there is really only two options here. Either close your legs or get a tubal ligation. This is sheer ludicrous behavior. Yes, I know Angeline Jolie and Brad Pitt have a bundle of kids but they truly have an income stream to support them. I know it's fun to pretend to live that kind of fantasy but really honey it's time to grow up and face the real world not the phony one you see on TV. What you fail to grasp my dear is that children themselves are extraordinarily expensive. We had our 2 daughters in 90 and 93. Because the local public schools were producing knuckle draggers that couldn't walk and chew gum simultaneously we put them in Lutheran school K-12. This cost us about 100,000 per kid. We took out NO loans (1 grandma did help but deducted the money from our inheritance). Yes it was incredibly difficult and entailed working 2 jobs seven days a week. No we didn't buy a McMansion (though we qualified easily by our income) our cars were beaters we kept operating for 200k miles and we took no vacations. Our reward? We have incredible children that fully appreciate our sacrifice who have worked very hard at school and worked menial jobs their friend scoff at just to help us out. Plus we have minimal debt( besides our mortgage ) because of our frugality. Please, for your childrens sake,learn how to properly budget. And this "want a zero slate" thing? Dear, this is fantasy again. The world is not fair nor it will ever be. Geez, if I could go back to 1971 and buy gold like my dad told me to? But that is off topic. Best of luck!

Miffed:-)

Thu, 04/26/2012 - 22:08 | 2378974 sof_hannibal
sof_hannibal's picture

and that is why I am never getting married or having kids... I am getting paid, and going to tell the system to fuck itself.

NOT having kids (maybe adopt-- maybe adopt someday in the far future)... to give someone a chance that otherwise wouldn't... but if anyone wants to beat down this [current] system and fight back... it is pretty simple = get a job, if you can find one, don't get married, and save your money (and don't have kids)... it's not boring life-- especially if you are a male.

Thu, 04/26/2012 - 23:05 | 2379106 Miffed Microbio...
Miffed Microbiologist's picture

Unfortunately you are dead right about marriage. We calculate it costs us about 5000/ yr in taxes just for the "privilege" of being married. We have friends who are planning a divorce around retirement for financial reasons, we'll probably follow suit. Sad comment on these financial times but one has to protect oneself by any means possible. I truly do not want my girls to marry, today it is another form of debt slavery. Really makes me laugh to hear Gays lobbying so heavily for marriage. Maybe they should get the right and be enlightened.

Miffed:-)

Fri, 04/27/2012 - 01:10 | 2379300 Revert_Back_to_...
Revert_Back_to_1792_Act's picture

Having a large family is ludicrous behavior huh?  Wow.  How big was your family?  Aren't you glad that your Mom didn't take this option? Maybe the monetary and education system has changed?  Go get a McGuffey's 4th reader from 1853 or earlier.  Keep in mind, this was 4th grade material in 1953.  Look at the editions published since then.  Kids are products of their environment.

Maybe something is wrong here...

http://www.youtube.com/watch?v=gbTb6hscxPE

This lady worked for the DOE.  Listen to her.

http://www.youtube.com/watch?v=DDyDtYy2I0M

Couple others...  how did things get this way?  Did you help set it up this way?

I don't think Sarah did it.

http://www.youtube.com/watch?v=buiO1K_kRSg

http://www.youtube.com/watch?v=VJpUQ-6cZrE

 

Thu, 04/26/2012 - 21:31 | 2378900 innertrader
innertrader's picture

Has anyone noticed that ALL the socialist government sponsored / enforced / guaranteed loans end up BAD?  Do I see a pattern here? LOL  There was a time when it was just eating me up to watch as this country went down the tubes.  Finally, I got over it, now it has truly become fun to watch as this country self-destructs....  it's so predicable I'm now counting on it!  We truly have ONE hope left, but that is it!

Thu, 04/26/2012 - 21:44 | 2378920 Yes_Questions
Yes_Questions's picture

 

 

Breakthrough into the mainstream, "Wage Slave" shall not be.

I care not who makes laws.

Thu, 04/26/2012 - 21:51 | 2378938 fasTTcar
fasTTcar's picture

The problem is that people have no respect for money when they do not have to earn it.

I have 4 kids myself.  The oldest is 3 years away from "higher" education, but already realizes that it is expensive and before jumping in, she needs to figure out a direction.

We are planning on offering her an incentive for whatever schooling she wants.  We will pay the exact percentage of the costs that she gets in marks.  Get 80%, we pay 80%, she pays 20%.  Get 50%, she pays 50%.

Thu, 04/26/2012 - 22:12 | 2378973 Yes_Questions
Yes_Questions's picture

 

 

The problem is that people have no respect for money when they do not have to earn it.

 

Coupled with the problem that people who create money have no respect for people.

 

Then, there are problems.

 

Plural.

 

Blessings on the 4 and Buena Suerte!

Thu, 04/26/2012 - 22:23 | 2379007 sof_hannibal
sof_hannibal's picture

good comment: society today ~~ cheat and lie your way to the top... just don't get caught; steal what you can; hide your taxes overseas... mark to market all the way to MF global vaporizing bankruptcy... screw over the farmers-- they are stupid and suckers and should know better... keep your bonus-- you have earned it-- the system is totally not broken; lobby for tax payer bailouts, and lobby for lobbyist... life is good, no? I paid my loans off = I am so smart, other people are just poor and lazy; and must not have as good parents as me (which is their fault of course) Yes_Question, good point... straight to the bone... I plan on stealing your quote!

Thu, 04/26/2012 - 22:52 | 2379073 Yes_Questions
Yes_Questions's picture

... life is good, no? I paid my loans off = I am so smart, other people are just poor and lazy; and must not have as good parents as me (which is their fault of course)..

actually used to be right there.

steal it far and wide.

Thu, 04/26/2012 - 22:22 | 2379008 sof_hannibal
sof_hannibal's picture

-

Thu, 04/26/2012 - 21:51 | 2378939 gaoptimize
gaoptimize's picture

"When Sarah's college softball team pressured her to drop classes she wanted to take, she quit, lost her scholarship and had to make up the difference with loans."  Really?  I wonder if getting her off scholarship was the point, so it could be offered to the next talented highschool grad.  I wonder if Sarah will be bright enough to resent the system that enabled her poor decisions and work against it, rather than looking to it for more largess.

Thu, 04/26/2012 - 21:56 | 2378949 Decolat
Decolat's picture

Fuck this college debt shit, I'm paying my tuition as I go. 70 credit hours so far, spread over four years, as I can afford. NO DEBT. What's the big hurry, anyway? Rat race fools get what they deserve. 

 

 

Thu, 04/26/2012 - 22:10 | 2378980 WallowaMountainMan
WallowaMountainMan's picture

Always late to the post your comment to the blog party, i have a question. The bad news is that i forgot the question. The good news is that i forgot the question.

ok, ok....here it goes. what % of student loan applications were granted post the 2005 you can't bankrupt them law was passed vs. those granted prioriouslyish ?

i know its meaningless to the stupid should die for being stupid crowd, and to the hey this is an exception to reality crowd, and to everyone else, but i am just curious.

Thu, 04/26/2012 - 22:15 | 2378993 Yen Cross
Yen Cross's picture

 281 posts, says it all!  Just ask Bill Gates and Steve Jobs( ghost)!

Thu, 04/26/2012 - 22:28 | 2379023 mrpxsytin
mrpxsytin's picture

Thankfully, people learn from the mistakes of others. So I don't see this ever happening again in the future...................

Thu, 04/26/2012 - 22:34 | 2379028 gabadoo
gabadoo's picture

Since we are talking about debt enslavement into perpetuity, I got this nice notice from my accountant about a $432 assessment from the State of Florida for Unemployment Tax. I found the following link:

 http://dor.myflorida.com/dor/taxes/ut_faq.html 

http://dor.myflorida.com/dor/taxes/pdf/ut_fed_interest.pdf 

Essentially, the state owes the feds 1.7 billion, and us employers are now footing the bill for the INTEREST payment on debt. Of course I am paying the maximum rate of 5.4% since I am a sole proprietor. So, assuming the principle is never repaid, I can assume a nice continuous fee of 432 per year into perpetuity. So the FED, who loans this money through no effort or labor, now entangles states, and it is the producers and those who keep things running to pay the bills from their productive REAL labor. What a bunch of bs this is turning out to be.

Thu, 04/26/2012 - 22:34 | 2379031 FrankDrakman
FrankDrakman's picture

I question the part of the article that said a 1976 study showed fewer than 1% of student loans went into bankruptcy. I was in university in Canada from 1975 to 79, and even then, I was hearing about students who declared bankruptcy immediately after graduating so they wouldn't have to pay back student loans. (The great irony here is that I was an engineering student, one of the most expensive undergrad courses, and we were only paying $1,000 in tuition A YEAR. Even with books and board, the idea that you could rack up more tha 12 G's in debt for an BA/BS degree is pretty far-fetched, but people were using the bankruptcy scam here.) I can only imagine with the larger number of private universities in the US with their bigger price tags that this trend was accelerating in the late 70's.

Thu, 04/26/2012 - 22:46 | 2379055 michaelj007
michaelj007's picture

The real rub is the fact that the semi-private lenders (ie- sallie mae) still receive a GOV guaranty on up to 97% of the principal (I am not sure whether this includes accrued interest, penalties and fees also)... therefore, many of these lenders are receive an unfair risk premium... the debt is non-bankruptable, GOV guaranteed and there is no collateral to mark-to-market (ha ha!) or inspect or underwrite or anything.  You have to be 21 yrs old to legally indulge in alcohol and its consequences, but the debt dealers have free-reign on our youth once they turn 18.

Thu, 04/26/2012 - 22:50 | 2379065 exiledbear
exiledbear's picture

Sorry to be an intarweb nitpicker. Peonage, not slavery. Almost as bad as slavery. Outlawed in most civilized places.

Fri, 04/27/2012 - 00:54 | 2379265 Revert_Back_to_...
Revert_Back_to_1792_Act's picture

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

http://en.wikipedia.org/wiki/Capitol_Hill_Babysitting_Co-op

16 Tons - Tennessee Ernie Ford

http://www.youtube.com/watch?v=jIfu2A0ezq0

"The few who can understand the System (Cheque Money and Credits) will either be so interested in its profits, or so dependent on its favours, that there will be no opposition from that class. While on the other hand, the great body of people mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint and perhaps without even suspecting that the system is inimical (hostile, hurtful) to their interests.

From this web page.

http://www.relfe.com/plus_5_.html

Another interesting quote in red at bottom of this page.

http://www.gemworld.com/EdMandellHouse.htm

 

Thu, 04/26/2012 - 23:37 | 2379098 Yen Cross
Yen Cross's picture

 Off topic Tyler;  Any chance of "gaming "  BoJ vs Kampo and MoF?    My aud/jpy limit orders are getting STALE!

  Albeit that / CABLE trade is looking a bit stretched? Perhaps I should short SEK/NOK? ( Sweden/ Norway) ?   Nah ! No liquidity.

  Just like gbp/aud! Ker plunk she goes!

Thu, 04/26/2012 - 23:25 | 2379143 toomanyfakecons...
toomanyfakeconservatives's picture

Three words: Student Loan Suicides

Thu, 04/26/2012 - 23:42 | 2379175 VyseLegendaire
VyseLegendaire's picture

Amerique ; C'est la vie.

Thu, 04/26/2012 - 23:45 | 2379180 justsayin2u
justsayin2u's picture

My wife and I each had 13000 in student loan debt back in the early 80s and paid it off with no problems. Thats 31000 is todays dollars.  Bunch of whiners.

Thu, 04/26/2012 - 23:50 | 2379188 Yen Cross
Yen Cross's picture

 Good on ya!  Nice work!  is that 13000,  or 130K?  For simplicities sake?

Fri, 04/27/2012 - 00:27 | 2379250 Yes_Questions
Yes_Questions's picture

 

 

nice work indeed. 

Fri, 04/27/2012 - 00:42 | 2379252 Revert_Back_to_...
Revert_Back_to_1792_Act's picture

 

I met a nice young lady who was studying to be a dentist.  She was a student in the dental school where I had some dental work done.  I asked her if she was going to get any of the money I paid for the work I had done to go toward paying for her education.  She laughed and said no.  She then told me she would end up with a debt of over $250,000.00 when she graduated.  She considered herself fortunate because she was going to take over her Dad's existing practice and didn't have to invest as much to get started.  The school she was graduating from would be what I call a decent - but not super expensive or prestigious - University.

   It is unreal saddling a young doctor with a debt like this. I don't think that will reduce the costs of health care. There are a ton of other problems with putting someone like a doctor under this immense pressure to pay back a loan.  A debt like this could also cause them to loose their practice during an illness or bad times.   I know another doctor that retired rather than comply with all of the Federal requirements for record keeping.  Seems like all this legislation is hurting our medical system and making it more expensive, not helping it.  WHY?

Medical costs are outrageous.  It cost $80.00 to have a child with anesthesia and a short hospital stay in the 1950's.   There was no insurance because it was not needed.  We still had silver coin in circuation backing the dollar at that time.  Seems like we should go back to that monetary system.  I think this is where the problems started.

http://www.presidency.ucsb.edu/ws/?pid=27108

I am confused about this too.  It says "With federal loans, the concern was that making it too easy to walk away from debts would put taxpayer dollars at risk." - Wouldn't that really be "fractional reserve generated fiat dollars".  Where do 'taxpayers' come into the picture?  If the debt is discharged, how would they be repaying it?

According to the Constitution, we should have uniform laws on the subject of Bankruptcies.  A bankruptcy is supposed to be a bankruptcy.

 

 

Thu, 04/26/2012 - 23:51 | 2379191 SilverDoctors
SilverDoctors's picture

Unrelated to this thread but Tyler doesn't have it up yet: the House passed CISPA tonight in an unexpected last minute vote.  It's been nice reading Zerohedge.

http://www.silverdoctors.com/cispa-passes-house-in-unexpected-last-minut...

Thu, 04/26/2012 - 23:55 | 2379201 WAZZU80
WAZZU80's picture

As long as there are kids paying 50+K per year for 4-5 years to get jobs that pay <30K/year (if they can get one), the problem will continue to grow.  Time for parents to provide guidance that it is OK for kids to go to the local state school and to get a marketable degree.  We need more engineers and scientists and fewer lawyers and social workers!

Fri, 04/27/2012 - 00:00 | 2379211 Change-In-Trend
Change-In-Trend's picture

  • My short S&P 500 position remains in play but is currently underwater. Rather than add additional shorts into strength i decided to keep my position sizing in order to reduce any more exposure to higher prices. 

  • If we are due for a higher close on Friday i will exit my position at a loss and protect my capital.
  • The equity cycles are suggesting that a move down is now imminent.
  • 3 Dow bellwether stocks, Microsoft, Exxon Mobil and and Boeing are already showing signs of weakness.
  • Exxon Mobil is showing signs of peaking at a time cycle high with a very strong dominant trend and high statistical probability. (see attached)
    • The USD Dollar ETF (UUP) is poised to move higher.

    https://www.dropbox.com/sh/ip40fvw18u62s2s/ToZcF9tITd/27%20Apr%202012

    To subscribe to newsletter email:

    change.in.trend@gmail.com

     

    Fri, 04/27/2012 - 00:08 | 2379226 Yen Cross
    Yen Cross's picture

    Liquidate your position, and buy 2 shares of " MicroSoft"! 

    Fri, 04/27/2012 - 06:18 | 2379511 jomama
    jomama's picture

    If I had a company, I would name it "MacroHard".

    Fri, 04/27/2012 - 00:17 | 2379239 Arkadaba
    Arkadaba's picture

    And in Quebec students have been on strikes for a number of weeks now with very little mainstream coverage except in Canada and that has been somewhat muted (aside from references to broken glass). My sympathies lie with the students for a number of reasons. In any case the latest (from one point of view): 

    http://montreal.mediacoop.ca/story/semantic-strike/10652

    Another POV: 

    http://www.thestar.com/opinion/editorialopinion/article/1168096--tuition-hikes-student-strikes-and-lessons-in-applied-politics

    And another:

    http://www.theglobeandmail.com/news/politics/anger-mounting-over-quebec-student-boycott-crisis/article2414524

     

    Fri, 04/27/2012 - 02:46 | 2379365 headless blogger
    headless blogger's picture

    Some of the blame needs to be put on colleges too. Most are not putting out quality education. I returned to the University after years only to find A's being handed out like candy, Prof's not knowing their subject, and more interest in spending millions on Student union buildings and stadiums than the curriculum. Needless to say, I finally had enough after 6 quarters. It was a total waste of money and time. It is considered a good univeristy, too.

    You can graduate in something and not even be knowledgeable in your field. What good is that when you are looking for a job or trying to do the work at a new job?

    If they want to pass more laws, they should make it easy for students to sue the colleges if those colleges do not provide the training and knowledge they say they are going to give.

    On an aside, recently the University of Denver hosted two guests (at two different dates and times in April). One interview, by the Dean of International Studies, Christopher Hill, was with Condoleeza Rice and the other one was with Madeleine Albright. This is a shame that "higher education" is promoting a War criminal such as Rice, and a woman that is on record saying it was "worth it" for the U.S. actions in Iraq that killed 1/2 a million children.

    Another fact about "higher education" in the U.S.: Yale, Harvard, and Columbia (all of which are supposedly the TOP schools in the country) have produced most of the 9 Supreme court justices in our country. Also, those same colleges represent many of the Political and Banking classes. NOT that any of these people are having a hard time paying back their loans: they are all on the government payroll doles and most are making millions on the side through legalized Bribery and moving into private corporate jobs...or vice versa...where they are first in corporate halls and move into political positions. (Dickless Cheney as an example).

    Fri, 04/27/2012 - 02:56 | 2379369 chealy3
    chealy3's picture

    I dont see a "like" button

    Fri, 04/27/2012 - 02:55 | 2379370 chealy3
    chealy3's picture

    I dont see a "like" button

    Fri, 04/27/2012 - 02:56 | 2379371 headless blogger
    headless blogger's picture

    At the end of the day, all of this is going to culminate in one massive hellish REVOLUTION. And from past history we know that revolution does not always work in favor of the masses, although they will be driven to it when they have nothing left to lose. This will be a very hot day in hell for the self-elected Elites. All their gated communities, security systems, and bullies outfitted in the latest protective gear will not insure a damn thing for them!

    Fri, 04/27/2012 - 03:00 | 2379374 chealy3
    chealy3's picture

    talk is cheap

    Fri, 04/27/2012 - 03:14 | 2379383 chealy3
    chealy3's picture

    talk is free

    Fri, 04/27/2012 - 03:18 | 2379386 Chupacabra
    Chupacabra's picture

    Fucking whiny pieces of shit.  You spent 4 years getting drunk and stoned on someone else's dime and now you want the loan to be forgiven?  F U.  Should have done the smart thing and started a business instead of drinking and chasing ass for 4 years.  Not my probrem.

    Fri, 04/27/2012 - 03:26 | 2379392 chealy3
    chealy3's picture

    You missed the point.

    Fri, 04/27/2012 - 03:48 | 2379413 Chupacabra
    Chupacabra's picture

    What, that they can' t discharge their debt in bankruptcy like, say, a credit card bill?  With all due respect, fuck you, you missed the point,  Make your choices and live with the consequences.  Why do I owe you a free ride?  Lick my hairy bean bag.  And get a real job.

    Fri, 04/27/2012 - 03:53 | 2379423 chealy3
    chealy3's picture

    I have a real job, never asked for a free-ride.

    Fri, 04/27/2012 - 03:56 | 2379426 Chupacabra
    Chupacabra's picture

    What point did I miss, you fucking moron?

    Fri, 04/27/2012 - 03:59 | 2379433 chealy3
    chealy3's picture

    argumentive stament

    Fri, 04/27/2012 - 03:20 | 2379388 chealy3
    chealy3's picture

    Perpetuity, annutiy. I fear this is all a waste.  An aimless blog for people to bitch.  You want change, ask for change. And by ask I mean change. Not the kind that was promised too you, but the kind you want. 

    Fri, 04/27/2012 - 03:29 | 2379395 Yen Cross
    Yen Cross's picture

     Your " Family Crests" perpetual  Annuity ?

    Fri, 04/27/2012 - 03:56 | 2379428 Chupacabra
    Chupacabra's picture

    It's hopeless.  Go kill yourself.

    Fri, 04/27/2012 - 03:26 | 2379391 tahoebumsmith
    tahoebumsmith's picture

    I have teenagers...We talk about their future all the time.They understand the word HOODWINKED... My kids will avoid the system as much as possible... Here is what you don't wan't for your kids...

    http://www.youtube.com/watch?v=_ZkyKMomoyA

    Fri, 04/27/2012 - 03:51 | 2379417 Chupacabra
    Chupacabra's picture

    Chealy3 - DO NOT LOOK.  Your dopey world view may crumble.

    Fri, 04/27/2012 - 03:55 | 2379424 chealy3
    chealy3's picture

    Already Crumbled.

    Fri, 04/27/2012 - 03:33 | 2379400 chealy3
    chealy3's picture

    Hoodwink sounds German? Another miss. Avoid, agree you still lack a choice.

    Fri, 04/27/2012 - 03:49 | 2379414 Yen Cross
    Yen Cross's picture

     Easy There " Helter Skelter" Tyler Wanabe!

    Fri, 04/27/2012 - 03:52 | 2379420 chealy3
    chealy3's picture

    Not trying to be, only getting tired of watching and waiting seeing. Shame on me.

    Fri, 04/27/2012 - 03:43 | 2379406 AnAnonymous
    AnAnonymous's picture

    The whole question is whether family heritage will offset the student debt.

    For some US citizen families, it will. US citizen Bernanke's son is said to graduate with $400k, which are likely to be offset by the inheritance he'll receive.

    Promising pattern of things and true to Smithian economics.

    Time to know who can afford living in the US of A (and the other US citizen nations)

    The others, most coming from the middle class, will solve it the US citizen way, by emigrating and bringing US citizenism lights to backward people.

    New wave of colonization being triggered, US citizen style.

    Fri, 04/27/2012 - 03:49 | 2379415 chealy3
    chealy3's picture

    Hope is there, until it's not. Then.

    Fri, 04/27/2012 - 03:53 | 2379422 Chupacabra
    Chupacabra's picture

    Typical Chinese citizenism response.  No concept of family because you kill all first-born females and fuck your male cousins with your tiny pee-pees.  I would slap you for being so stupid, if I ever saw you on the street, but you all ROOK SAME.

    Fri, 04/27/2012 - 03:56 | 2379427 chealy3
    chealy3's picture

    Typical non-american response. 

    Fri, 04/27/2012 - 03:58 | 2379432 Chupacabra
    Chupacabra's picture

    Dude, you are not only a fucking idiot, but also a rookie.  Go post at HuffPo.  You don't know "An Anymous"'s schtick?  You suck so fucking much.

    Fri, 04/27/2012 - 04:02 | 2379437 chealy3
    chealy3's picture

    argumentive statement

    Fri, 04/27/2012 - 04:24 | 2379444 Chupacabra
    Chupacabra's picture

    ARGUMENTATIVE, not ARGUMENTIVE, you FUCKING MORON.  God, I hate having to live in a society where people like chelay3 can vote.  Fuck me.

    Fri, 04/27/2012 - 04:27 | 2379445 chealy3
    chealy3's picture

    U.S ofa.

    Fri, 04/27/2012 - 04:28 | 2379446 chealy3
    chealy3's picture

    U.S ofa.

    Fri, 04/27/2012 - 04:30 | 2379447 chealy3
    chealy3's picture

    Dow 13000

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