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The academic bubble is ready to burst while academics in their infinite wisdom tell us how they know how to run our society and civilization – don’t you find that strange? Looks like he hasn’t got his house in order, and yet, wants our entire country to be run like one giant college campus – really interesting. These same academics want to tell us how to vote, redistribute wealth, and how to think – well, I guess their day of reckoning is around the corner – and I fear what’s to come. Wouldn’t be pretty. No, I don’t want to be the one to say; “I told you so.” Sure, there are others with more social media followers who see the reality of the situation when the time comes to spread that slap on your face. Ok so let’s talk?
40% of student loans are in technical default (90 days behind with no other agreement to catch up on payments). That’s $583 billion in defaulted debt that we may never see paid. Trust me when I tell you that the college loan bubble has burst and is in extreme trouble. Why is this allowed to continue? Well, if it closes it will collapse academia, become a major problem for our federal government, add over 1/2 trillion to our $20 trillion national debt, and cause the wrath of millennials, Joe Democrat promised “free college for all” during the 2016 presidential election.
Still, by the time the election is over student loan debt will be $1.57 trillion, even though official figures claim only $1.2 trillion was actually the figure before the start of the 2015 academic year.
If you don’t see the magnitude of the problem, let’s talk about the auto industry for now. It turns out that the number of “subprime” auto loan defaults is at another all-time high of 4.5% – subprime meaning loans made to people without the ability to pay or with marginal credit ratings, perhaps lower- Coming from socioeconomic borrowers. Last time this happened the auto industry crashed and needed a huge bailout, and we are now reaching those same numbers – and realize it’s only 4.5% like the student loan problem and not 40-50% .
scared yet? Well, today is Halloween 2016, and I am, and no, there won’t be any good witch flying on her broomstick to win the next election to use hocus pocus to overcome this problem — in fact, both presidencies. are likely to see the auto loan problem as well as the student loan debt problem get worse – not to mention our stock market breaking all-time highs with record PE ratios and major stock market indices.
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