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Student Loans, the Next Big Threat to the U.S. Economy? Student borrowing has reached a point where officials are comparing it to the mortgage crisis.

Student Loans, the Next Big Threat to the U.S. Economy? Student borrowing has reached a point where officials are comparing it to the mortgage crisis.

Outstanding student debt topped $1 trillion in the third quarter of 2013, and the share of loans delinquent 90 days or more rose to 11.8 percent, according to the Federal Reserve Bank of New York.

… the “very rapid rise in student loan debt over the last few years” can “actually have some pretty significant consequences to the economic outlook,” New York Fed President William Dudley told reporters in November. “People can have trouble with the student loan debt burden—unable to buy cars, unable to buy homes—and so it can really delay the cycle.”

Meanwhile, our national political and education leaders continue to tout that to get ahead economically you need a college degree, compounding the problem just like the real estate speculators, house flippers and unqualified buyers and unscrupulous lenders did to fuel the housing crisis. 

 

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