“When you see a guy in a loan made in 2005 that is still in school, you throw that away,”

[Liberal_in_LA]

How student loan debt cheapens a college education

In the poor job market, investors in the debt bond market see recent college graduates as a bad bet
Matt Wirz writes for the Wall Street Journal that the bond vigilantes may not be sniffing any price inflation but players in the student debt market are deeply discounting the job prospects for recent college grads.

The assumed default rate on students loans has moved from 25% to 30% upward to between 30% and 40%. Failure to graduate is the most important factor in whether a graduate pays back a loan. Over 20% of Americans between the ages of 20 and 24 without a college degree are unemployed. The rate is 8% for those of the same age with degrees.

Investors also take a dim view of buying the ever increasing debt of a perpetual student. “When you see a guy in a loan made in 2005 that is still in school, you throw that away,” said investor Rubin Bahar, of Eagle Asset Management.

:wtf: :wow:

So what are the best bets when buying student debt? Technical schools. Students pay the least for their education with the potential to make good money after graduation in only a couple of years.

By that arithmetic, technical colleges come out on top, Mr. Ades said. “We’re in a skills based economy and what we need is more computer programmers, more ,” he said. “It’s less glamorous but it’s what we need.”


http://www.csmonitor.com/Business/Mises-Economics/2011/1115/How-student-loan-debt-cheapens-a-college-education

[abelenkpe]

1. One more reason to remove profit from education

and health care and retirement.

[pnwmom]

2. But not for-profit technical schools.

And even with a solid technical education at a good state university or non-profit college, there's no guarantee of a job. It took my nephew a year to find his first job, with an engineering degree from an excellent college.