[Glaucon]

http://www.zerohedge.com/news/2014-10-23...long-enoug

from zerohedge.com:



she admits, "I am an alcoholic and I have HIV," she tells the BBC. "That's under control." So what is the cause of most if not all consternation in the final days of Dupree's life? "I was sick and I didn't worry about paying back the debt." As a result, Dupree defaulted on her loan, and since she turned 65 she has had money withheld from her Social Security benefits.

"Just recently I received a notification that they are going to garnish my wages because I am still working," says Dupree, who works 30 hours a week as a substance abuse counsellor.

The debt in question: Dupree owes $16,000 in student loans she acquired in 1971 and 1972.

Is this the future that awaits the majority of people who graduated now-days in made-up studies?

[DannyAlberta]

^ no.

once this starts happening more and more and for more and more $$$, there will be a massive gov't bailout and usa taxpayers will be told to "suck it up".

[DarkTriad]

(10-23-2014 11:25 AM)Glaucon Wrote:  

http://www.zerohedge.com/news/2014-10-23...long-enoug

from zerohedge.com:



she admits, "I am an alcoholic and I have HIV," she tells the BBC. "That's under control." So what is the cause of most if not all consternation in the final days of Dupree's life? "I was sick and I didn't worry about paying back the debt." As a result, Dupree defaulted on her loan, and since she turned 65 she has had money withheld from her Social Security benefits.

"Just recently I received a notification that they are going to garnish my wages because I am still working," says Dupree, who works 30 hours a week as a substance abuse counsellor.

The debt in question: Dupree owes $16,000 in student loans she acquired in 1971 and 1972.

Is this the future that awaits the majority of people who graduated now-days in made-up studies?

Saw another big article on this recently. The student loan bubble apparently dwarfs the real estate bubble. A lot of these people are going to die still owing their student loans.

[WD-40]

It's Ashley Dupré's mom, lolzzoozzzolzz.

[The Beast1]

Clever how the feds are taking her social security money to pay down those loans.

Can the government seize her assets when she dies for not paying off student loans?

[tarquin]

She has HIV, is an alcoholic and is a substance abuse counselor. What?

[tarquin]

(10-23-2014 12:17 PM)frenchie Wrote:  

Clever how the feds are taking her social security money to pay down those loans.

Can the government seize her assets when she dies for not paying off student loans?

Yes, but any creditor can do that, not just the Feds. However, only government owned-debt can be paid back with social security garnishment.

[el mechanico]

(10-23-2014 12:17 PM)tarquin Wrote:  

She has HIV, is an alcoholic and is a substance abuse counselor. What?

double post

[el mechanico]

(10-23-2014 12:17 PM)tarquin Wrote:  

She has HIV, is an alcoholic and is a substance abuse counselor. What?

Experience

[AnonymousBosch]

(10-23-2014 11:30 AM)DannyAlberta Wrote:  

^ no.

once this starts happening more and more and for more and more $$$, there will be a massive gov't bailout and usa taxpayers will be told to "suck it up".

I doubt the American government can spare the trillion dollars that is the current student loan debt.

More likely, the worthless degrees of the overeducated current generation will become even more worthless and the coming generation will wise up and not take Beyoncé Studies.

[Simeon_Strangelight]

(10-23-2014 12:19 PM)tarquin Wrote:  

(10-23-2014 12:17 PM)frenchie Wrote:  

Clever how the feds are taking her social security money to pay down those loans.

Can the government seize her assets when she dies for not paying off student loans?

Yes, but any creditor can do that, not just the Feds. However, only government owned-debt can be paid back with social security garnishment.

Yes - and the government is usually the primary creditor. Student loan debts created via compound interest are the greatest asset collection tool ever devised, since the jobs are not there to repay the debt (for 90% of students), the cost of studies are completely overblown (partly due to ease of getting a student loan) and the debt cannot be eliminated legally. One trillion outstanding as of now - I estimate that 700 billion will not be repaid in full.

Pro tip: if a bank will not loan you the money without collateral, then they consider it a risk not worth taking - and neither should you. In rare cases - STEM studies at MIT, Ivy League - useful studies - the bank might give you a loan. If it does, then you can bet that your studies have a high likelihood of you being able to pay it back.

[DannyAlberta]

^ no question. the us gov't can't spare it.

but the federal gov't has guaranteed the lion's share of student debt. so when the next big catastrophic recession comes and a significant percentage of these go into default, I'm not actually sure what choice tax-payers will have. there will be massive forgiveness of the individual loans in default (although not the guarantees owed to the institutions themselves), meaning the debtors won't pay but the gov't will. the people who haven't defaulted will feel (justifiably) like suckers and demand their own forgiveness, which will be granted by politicians "compassionately" (read: in exchange for votes). about a trillion dollars later net from the treasury (read: taxpayer) a whole bunch of people will have obtained substantially discounted, albeit likely useless, degrees.

it's actually more of a bail-in situation than a bail-out the more i think about it.

we are only a decade or so behind in Canada in creating the same bubble, so i'm not trying to lord anything over my southern neigbours.

[armenia4ever]

Being in debt to the government is scary. It is the only time when owing money to a creditor can actually result in you going to jail or having your wages garnished. Hell, it makes the worst debt recovery agencies look like panda bear charities.

When the bubble bursts - which it will - there is either going to be alot of people going to jail or massive amounts of loan forgiveness which the taxpayers will of course cover.

[HeyPete]

WNB

[WalterBlack]

How the fuck can anybody have $16,000 in debt lying around from 40 years ago? Paying that back is only $400 year + interest...even somebody on minimum wage can afford that!

[Suits]

(10-23-2014 06:50 PM)WalterBlack Wrote:  

How the fuck can anybody have $16,000 in debt lying around from 40 years ago? Paying that back is only $400 year + interest...even somebody on minimum wage can afford that!

This is what happens when you only make the minimum payment.

[lurker]

The taxpayers should suck it up. More specifically, the older generations should be forced into covering the cost. That's what happens when you debt finance your own prosperity, drive up the cost of essential public goods by treating them as administrative employment centers, and (most crucially) destroy any domestic middle-class blue collar options through short-termism and offshoring.

[BortimusPrime]

You know, this is why in the 19th century England had gutters for these people to die in.

[Simeon_Strangelight]

(10-23-2014 06:48 PM)HeyPete Wrote:  

WNB

You really don't have to stress that you would not bang. If you are ready to bang this aging HIV carrying post-apocalyptic wall-mummy, then you are likely doing something wrong while being on the forum - heh.

Lowering your standards is all good and well, but if I had the option of fucking her or death, I would seriously consider the sweet embrace of the Grim Reaper.

[Feisbook Control]

(10-23-2014 12:17 PM)frenchie Wrote:  

Clever how the feds are taking her social security money to pay down those loans.

Can the government seize her assets when she dies for not paying off student loans?

What assets? I'm being serious.

My parents are fine, but they don't know many people, if any, who will die with anything to their names other than what's in their living room or garage, none of which are assets (i.e. things that generate cash flow), and much of which wouldn't even be worth trying to sell at auction it would be worth so little. What do you think that woman would get for her furniture, clothes, CDs, kitchen utensils, appliances, etc.? A few thousand? Maybe double it if she has a car. Okay, so the government is going to seize 10 grand, tops, which won't cover the 16 grand she owes, plus the costs of collecting it. More likely, it might not even be worth them going to the effort because they might only just come out ahead by the time they pay the wages of the people to collect it all and try to sell it off. Those people like the woman in the article are all going to be on reverse mortgages or the like, outright living off the government, or working until they drop. My father's closest friend used to have his own small business (which he ran badly and eventually closed). At the ripe old age of 63 or 64, the guy retrained as a geriatric nurse or some other sort of carer. He's a great guy, really nice, but he has nothing to his name and is going to have to work until he drops.

I can't remember the exact number, but the average household in the U.S. has a net worth of something like $50,000 or $100,000. That's enough to live off for what, 2-5 years? What if they live to be 80+?

I don't know exactly what's going to happen, whether it's bail-ins or bail-outs, soaking the rich, or anything else. There are many possibilities. What I do know though is that it's not going to be pretty. Furthermore, if you're a guy who has earnt a decent amount and also been frugal, and then prudently invested that money, even just for a ten year period, you're already way ahead of the curve. You already likely have a greater net worth than the average American. Here's the really important part: that makes you a target. You might not consider yourself rich, but it's all relative. In the land of the blind, the one-eyed man is king. In the land of the indebted, the debt-free with assets (even if modest) are targets.

As to the question of how that woman could not pay back $400/year, I know where all of the money likely went. Read between the lines. She has HIV. It went up her arm.

[Troll King]

^^^ This right here.

Also, what happens with the children? Now, I doubt this slag has any but who knows? But what about the rest in the middle class. One thing that has been bugging me lately is all the talk on the left about inheritance taxes and even abolishing inheritance. I saw a few commenters on Pandagon the other day talking about how they wish inheritance was illegal, one went all the way and the other said for anything over 100k, because they don't think it is fair that you can be born into a higher socio-economic class.

Part of me gets their anger. I am far from being born with a golden spoon stuck up my ass but I am far from lower class too.

Inheritance, for most of the lower upper classes on down has been one of the life anchors that has kept many families solvent and out of the streets, especially during harder economic times.

Grandma dies and everyone splits up the antiques, sells off an old car or two and then rents out or sells off the house and even after taxes and funeral costs and paying off debts that can still net 10k or more per child pretty easily. Now this assumes that they owned a house, which is the most valuable asset.

But I really do wonder how all this will work out with inheritance. If all of a sudden the children of boomers not only find out that they won't get a cash flow from their parents death but they may end up owing tens of thousands of dollars on top of what they already have in debt, and what they haven't made in their lifetimes due to boomer and genx policies, then I could see things getting really ugly here in a few decades.

I have known a couple of families to be split apart and never talk to each other again due to fucked up and badly written wills. What happens when the government is now considered the favorite sibling?

[DjembaDjemba]

The student debt bubble is more of an American problem, the other Anglo states (UK, Canada, not sure about OZ and NZ) subsidize higher education. Instead of students being on the hook down the line, the money is fronted outright by the government. It's a better system than what the US has.

We still pay for higher-ed here, but it's something to the tune of $2000 per semester.

[Feisbook Control]

(10-24-2014 05:50 PM)DjembaDjemba Wrote:  

The student debt bubble is more of an American problem, the other Anglo states (UK, Canada, not sure about OZ and NZ) subsidize higher education. Instead of students being on the hook down the line, the money is fronted outright by the government. It's a better system than what the US has.

We still pay for higher-ed here, but it's something to the tune of $2000 per semester.

Djemba: That's just rearranging the deck chairs on the Titanic though. If the degree is not worth anything, then it's not worth anything. The cost is still there and someone still pays for it. In some ways, it's even worse in the system you're talking about because at least in the U.S. system, there's some form of moral hazard that might eventually put people off saddling themselves with so much debt. In the system you're talking about, there is a drain on society. Either the students eventually end up paying for those degrees through their own taxes, or more likely, some other poor schmuck has to carry them through his. In the meantime, younger people who might have seen older people saddled with debt and reassess if such a thing is good or not continue to think that there is actually such a thing as a free lunch.

Troll: It may well come, but if it does, it will be an unmitigated disaster. It is a fundamental biological drive to want to provide resources to one's offspring to help them get ahead of the competition.

In the short term, some people would migrate or send their money offshore. This has been played out time and time again the world over where people in unstable countries in the developing world have sought refuge for themselves, or at least their money, in places perceived to be stable and governed by sensible laws. Usually, this has been places such as the US, UK, Switzerland, but there have been regional players also, such as Hong Kong or Singapore. I believe Dubai/UAE is trying to position itself in a similar way. Another option is for people to hoard precious metals.

Most people wouldn't be that smart in the short term in the West simply because they have no real direct experience with such circumstances, and because they still labour under the illusion that their countries are somehow different to what they perceive as third world governments. There are the first inklings of real paranoia, distrust and disillusionment, but most people still believe things are pretty good.

However, they would respond to the perverse incentives created by inheritance laws in another way. Obviously, there'd be no reason at all to try to store wealth. People would not defer consumption in order to build businesses or invest in those of others. In the (very) short term, it would be great. The government would point to all of the consumption occurring in the economy as wonderful news, evidence of the brilliance of its plans, and might even expand its reach. In the medium to long term, however, all of the momentum in the economy would change into stagnation, and then decline. The economy would become sclerotic, captured either by the government or its cronies. There would not be innovation, and the country, its institutions and its companies would become increasingly unable to compete economically on the world stage. Life would get harder. As this happened, all the usual effects would happen: growth in the black market, capital flight (despite attempts at capital controls), under the table use of other nations' currencies or smuggling of precious metals, and eventually emigration to greener pastures. At the same time, the government would double down on its programmes, and would become increasingly draconian in order to try to get people to comply. That would be a feedback loop that would eventually spiral out of control to who knows what: sabre rattling at neighbours, revolution, opportunistic invasion by another nation?

Every dog has its day, and every empire declines. As it turns its back on what led to its rise, America will decline like any other nation in history.