Student Loan Debt Is Now as Big as the U.S. Junk Bond Market
To me, this is another implementation of the housing bubble:<p>- People see college graduates making a lot of money<p>- Politicians make it a priority to make it easier for people to get loans to go to college<p>- More people take out loans to go to college<p>- Colleges realize there is no downward pressure on price and raise tuition.<p>- Politicians continue to make it easy for people to go to college<p>- People take bigger loans to go to any school they wish<p>Until the music stops, things are sort of OK. People&#x27;s kids can go to any school they can get into, regardless of cost. Colleges can raise their tuition with no consequences.<p>Politically it&#x27;s a difficult problem, because the old solution of making more money available is getting out of hand, but what politician wants to stand up and tell people they can&#x27;t go to the college of their dreams just because they can&#x27;t afford it?<p>During the housing bubble, it was the cycle of &quot;people want to own a home&quot; =&gt; &quot;politicians say everyone should be able to own a home and make loans available&quot; =&gt; &quot;companies make money packaging up these loans&quot; =&gt; &quot;prices go up&quot; =&gt; &quot;people can&#x27;t afford homes&quot; =&gt; &quot;politicians make more money available&quot;. Until the music stops, everything is great -- everyone is making money, everyone is getting what they want. Then it unravels...