Watch Out for the Growing Student Loan Bubble

22 May

The amount of student loan debt in this country is approaching crisis levels. In fact, student loans could very well be the next big bubble to burst.

While we’re right to praise the merits of education and the value of learning, it’s smart to ask – what about the cost?

The total amount of student debt is second only to mortgages in terms of the highest amounts of consumer debt out there. It is more than credit cards and auto loans.

Last year there were 44 million student loan borrowers, with $1.3 trillion in outstanding debt. The average student borrower in 2016 had $37,000 in debt, which is up more than 70 percent from a decade ago. Some 5 percent of borrowers owe more than $100,000!

On top of that, in Q4 2016 the student loan delinquency rate was 11.2 percent, the highest of all debt types. More than one in 10 borrowers are 90 or more days late on their payments, and an astounding 3,000 borrowers default on their loans every day.Move to Trash

The easy flow of student loan money was ushered in primarily by two Democrat presidents (Clinton and Obama). Perhaps unsurprisingly, we’ve seen tuition costs since outpace all other commodity prices.

So, what does it all mean? It means student loan debt is out of control and parents needs to think long and hard before taking out loans for their children’s education. They could be paying for it for decades.

What’s to come of Health Care?

15 May

We’re about four months into President Trump’s first term and Obamacare lingers. But for how long? The president says the Affordable Care Act (Obamacare’s official name) will collapse on its own, that it’s a terminally ill patient with limited time who was declined treatment by Congress. Now, most people aren’t on Obamacare plans. Those who [...]

Retail’s New Pricing Battle

8 May

Not only are we losing retailers at an amazing clip, but it seems free market pricing is going by the wayside too. That’s because online retailers are using our data against us. Where consumers would use the web to compare prices between companies, web vs. brick-and-mortar stores and so on, now online retailers are shopping [...]

Brick-and-Mortar Stores in U.S. Closing Rapidly

1 May

News about the retail industry tends to crop up around the holidays, but if you look around, you’ll notice there is a lot going on with retail stores across the country – as in, a lot of them are closing. Almost 3,000 store closings have been announced so far this year, and we’re already outpacing [...]

Despite its Faults, the U.S. Still Leads the Way

24 Apr

The U.S. isn’t perfect – no country is. We have our issues at home and abroad. That said, some would have you think we’re in decline. But for all its imperfections, our country continues to dominate the global economy by a wide margin. Exhibit A is the fact that the U.S. accounted for 24.3 percent [...]

The Untold Story of the Income Gap

17 Apr

So much of the talk lately is about the income gap – that incomes for the rich are rising much faster than for the poor. Well, wages have risen fast for the top 1 percent of earners for decades. It’s the haves vs. the have nots playing out in chart form:   However, a new [...]

Sentiment vs. Technicals

10 Apr

We’re not supposed to discuss politics at parties. Well, we may want to exclude politics from our investments too. The fact is, markets have performed much better under Democratic presidents than Republican ones. That seems to defy conventional thinking because Republicans are often thought of as pro-business, while Democrats are seen as proponents of labor [...]

Leaving the Stock Market Party? No Need to Rush

3 Apr

The stock market continues to rise. We’re hitting records regularly in this long-running bull market. But at some point, the party will end. And when it does, many portfolios could tumble. It begs the question – when is it time to get out? It’s similar to when you’re at a great New Year’s Eve party. [...]

A Seismic Financial Regulation Shift is on the Horizon

27 Mar

We hear quite a bit about the Supreme Court and President Trump’s potential affect on it. Beyond nominating Justice Neil Gorsuch, the president could end up nominating more, especially if he wins a second term. But there’s another venerable institution that could be hugely impacted by President Trump – the Federal Reserve Board of Governors. [...]

In Every Border Battle, There are Winners and Losers

20 Mar

One of the most controversial parts of President Trump’s proposed economic policy platform is his plan for the border adjustment tax. You’ve probably heard about it – he wants to add additional tariffs on all imports to the U.S. If nothing more, it follows his “America First” economic philosophy. After all, we want to be [...]