Here is how the student debt bubble operates:
#1. College education has increased by 300% in 30 years;
#2. Potential students borrow a pile to somehow get that dreaded degree;
#3. The student takes out loans and more loans and more loans until he or she is drowning in debt, but is convinced that upon graduation;
#4. But economic reality suggests that there are few jobs, huge numbers of "graduates" and massive mill stones of debt around their necks.
#5. The Department of Education hires several "Collection Agencies" or "Guarantors" who are paid millions in bonuses by ensuring a debtor is immersed in austerity for the remainder of his adult life, paying off a mortgage due to the loans taken out to better himself.
Bloomberg did an excellent piece recently (see below)
http://www.bloomberg.com/news/2012-05-15/taxpayers-fund-454-000-pay-for-collector-chasing-student-loans.html
Anyone in the student loan debt trap reading this will get very angry. These are the main "guaranty" agencies:
https://www.salliemae.com/
http://www.ecmc.org/topic/manageDefault.html
Of course the next big change in the pipeline is a DOUBLING of interest rates on loans, which the Republicans want to increase in July.
http://www.bloomberg.com/news/2012-05-31/republican-leaders-offer-options-for-student-loan-subsidy.html
This would be disastrous for OMOTS with loans taken out to "educate" himself.
And the student loan bubble will surely BURST!
