Trillion dollars in student loan debt. Young people can't afford a house, family.

[achilles28]

The NYT published an article last week that stated the majority of jobs lost during the crash were decent-wage, middle class positions. And the majority of jobs created after the crash? Low paying, retail-level crap. It's not an apples-to-apples comparison.

Ignoring contingent effects, for a moment - even if student debt were wiped clean, there's no demand in the labor market for worthless liberal arts degrees (history, English lit, sociology, philosophy, women studies etc).

 

[hayman]

I don't see anyone addressing the real problem here - the College Scam. I just read that this past year's High School graduating class will have 70% of its members attend a 4-year college, with over 50% of these High School grads obtaining 4-year college degrees.

With these kind of #'s, a 4-year college degree has become the new High School diploma, since obtaining a 4-year degree no longer has the value it once had, since everyone is getting one. Can you spell Diploma Mill ?

On the flip side, these college (namely, private colleges) dupe these kids (and very often, their ignorant parents) into believing that attending their College/University and dropping $ 100K - $ 200K in a combination of tuition payments/loans is the right way to go.

The last poster is correct in stating that the jobs created nowadays are not high-paying jobs, but lower-paying jobs. This has been going on since 2000, under the Bush regime - he was famous for touting a low unemployment rate, but only creating $10 - $ 15/hour jobs, and allowing many of the high paying jobs to find their way overseas.

Bottom line is we have more College graduates than ever, fewer available higher paying jobs, and more debt being incurred by our youth. This all translates into a bleak economic picture for housing, jobs, growth, etc. I'm not saying not to go to college, but look at it from a business ROI standpoint only, and if you go, consider State colleges and paying cash if you can.

 

[badvestor]

Quote from hayman:



With these kind of #'s, a 4-year college degree has become the new High School diploma, since obtaining a 4-year degree no longer has the value it once had, since everyone is getting one. Can you spell Diploma Mill ?

.

All degrees are not equal. I'd have no issues taking a second mortgage on a house to send a kid to get a engineering degree from MIT. If the kid wanted to go to a Ivy league to do a liberal arts major, I'd say no money.

 

[morganist]

Quote from noob_trad3r:


When I was young, back in the days young people did not require a 100K work permit to get a job.

This is a very good comment. I have not thought of it that way before.

 

[hayman]

Quote from badvestor:

All degrees are not equal. I'd have no issues taking a second mortgage on a house to send a kid to get a engineering degree from MIT. If the kid wanted to go to a Ivy league to do a liberal arts major, I'd say no money.

I do think there are 2 exceptions to what I stated: 1) Going to a Top Tier 1 Private College (Harvard, Yale, Princeton, MIT, Stanford, etc.) can pay for itself in increased earnings (with the right major, of course) and 2) Going to a School because it's the only school offering a specialty degree in what you are interested in. And yes, some degrees are worth more than others - currently Engineering and Health-related majors are in demand.

 

[iprph90]

Quote from wilburbear:

Yes, we can prey on the vulnerable in this country (teenagers entering college), but we pay for it down the line.

Housing can't return to normal under these conditions, and student debt is still increasing.

To get back to the latter part of your premise- I have been thinking about this for a while now, as i have two kids in college. I am thankful that they are pursuing professional degrees and have accrued very little debt so far. As parents, we have decided to pay as much as we can for their education.

I mostly agree with you that the rising student debt will affect housing for many years to come. However, I think we have to redefine what normal means when it comes to the future of housing.

Also, the housing market is not a monolith. There will always be parts of this sector with a trend of robust growth. If you look at various international housing markets with sustained growth, it is obvious that land scarcity has a direct correlation to increased value. I suspect that the same case can made in this country.

But, when young adults already have a mortgage before starting their careers, the picture looks bleak. Add to this the declining birth rates, the death of baby boomers in the next 10-20 years, and more stringent immigration policies for now (even for educated professionals) well we might as well give up.

I tend to view myself as a recovering pessimist though, and even a pinhole of optimism can sometimes can lead you out of a dark forest.

 

[Zr1Trader]

If done right one can do it relatively cheap.

Get a head start senior year of highschool by getting some college general eds done for free. Then go to CC to finish the correct general ed credits to transfer into a better 4 year college for the last two years.

My GF did it with no scholarships ,lived at home with parents the first two years to save on room / board costs, worked summers and only had 15k in debt after the degree was completed.

When you send a kid to a 4 year school, most get euphoria living on their own and getting "free" financial aid checks to spend on room/board/food/books/tuition you can bet your right nut a lot of that money is going to alcohol, weed, tv. ipads, and xbox. I've seen it first hand .

My girlfriend worked at US Bank as a teller a while back and when the financial aid checks came for the year there was a line out the door to cash those checks for CASH to blow (not to deposit into their accounts). "Free" easy money in a college kids hands is dangerous. They have to earn it to understand its value.

Debt is slavery and it doesn't set in until the payments come due after graduation.

My kids aren't going to school until they have a detailed plan of exactly what their end goal is. Without the end goal in site then they change their major 3 times and end up wasting money not knowing what they want to do . They end up back at square one not knowing what they are going to do after graduation if they never had a clear goal in the first place.

Most kids in college seems to be "not sure exactly what they want to do yet" but they will "figure it out along the way", they say. These types do not deserve ANY financial aid until their "business plan" is in place.

 

[Zr1Trader]

"THERE are two kinds of knowledge. One is general, the other is specialized. General knowledge, no matter how great in quantity or variety it may be, is of but little use in the accumulation of money. The faculties of the great universities possess, in the aggregate, practically every form of general knowledge known to civilization. Most of the professors have but little or no money. They specialize on teaching knowledge, but they do not specialize on the organization, or the use of knowledge.

KNOWLEDGE will not attract money, unless it is organized, and intelligently directed, through practical PLANS OF ACTION, to the DEFINITE END of accumulation of money. Lack of understanding of this fact has been the source of confusion to millions of people who falsely believe that "knowledge is power." It is nothing of the sort! Knowledge is only potential power. It becomes power only when, and if, it is organized into definite plans of action, and directed to a definite end." - Napoleon Hill

 

[wilburbear]

Quote from hayman:

I don't see anyone addressing the real problem here - the College Scam. I just read that this past year's High School graduating class will have 70% of its members attend a 4-year college, with over 50% of these High School grads obtaining 4-year college degrees.

With these kind of #'s, a 4-year college degree has become the new High School diploma, since obtaining a 4-year degree no longer has the value it once had, since everyone is getting one. Can you spell Diploma Mill ?

On the flip side, these college (namely, private colleges) dupe these kids (and very often, their ignorant parents) into believing that attending their College/University and dropping $ 100K - $ 200K in a combination of tuition payments/loans is the right way to go.

The last poster is correct in stating that the jobs created nowadays are not high-paying jobs, but lower-paying jobs. This has been going on since 2000, under the Bush regime - he was famous for touting a low unemployment rate, but only creating $10 - $ 15/hour jobs, and allowing many of the high paying jobs to find their way overseas.

Bottom line is we have more College graduates than ever, fewer available higher paying jobs, and more debt being incurred by our youth. This all translates into a bleak economic picture for housing, jobs, growth, etc. I'm not saying not to go to college, but look at it from a business ROI standpoint only, and if you go, consider State colleges and paying cash if you can.

Friend of mine has a kid with a Masters in Forestry. Might have cost a hundred thousand dollars. The kid lives in a house with 5 other 20-somethings, and has a lawn mowing business.

You see, it would be different if a college could somehow guarantee a job placement, but that's impossible, and today's parents expect NOTHING from a college in terms of job placement. The kid is sleeping on a couch somewhere after graduation and the unfortunate parents are just numb.

Colleges know exactly what they are doing to young people.

 

[the1]

Not true at all. I've taken classes at our local college and many of them have been harder than 4-year university classes. 18 kids who spend their first 2 years at their local college are smart to avoid being saddled with 100k of debt at the age of 22. What a sad way to start your life.

Quote from Fah Q:

community college is crap though.