Not sure why OP was being downvoted. I just bought a new truck, financed mostly with an auto loan. I couldn't remember or provide half the information required for the loan application and was told "don't worry about that." I still got approved.

Another story, I recently changed rental apartments. My "credit report" was a page I printed out from a consumer credit reporting site, where I could've changed any data.

My point being, all this loose validation seems very remiscnet of the easy money that was so common pre-Great Recession.

Not even in the same ball park as 2008. Auto loans are a lot easier to recover than a home loan. If you don't pay your auto loan they just come pick up the car. Then they get to resell the car again. This is completely different than a home loan in both value, and the process for the lender recover the collateral.

Home loans right now are still very tight. I had to provide more documentation for a simple refi with the same bank, than I had to provide in 2011 when I purchased the home. When I asked why, they responded that regulations have continued to tighten since them.

When dogs can get a 500k home loan and then sell the house a month later for 600k I might start believing we are back in 2008.

Same experience for me on a recent car purchase. Dealer didn't particularly want a down payment, which made me suspect that they are being comped on loan volume when financed through manufacturer, a choice I opted for because the % was 2 points lower than my bank.

Cheap money is vital to the economy. I know that the market is different in the EU but look at what is happening in Germany and Greece. You would not want that.

massive endemic fraud is not vital to the economy... although it is vital to destroying an economy.

Vital to an unstable, bubble prone economy. Long-term sustainability is not enhanced by cheap money. What we want is clever money.

Low wages? The US has among the highest wages on the planet. To go with nearly the highest GDP per capita and nearly the highest disposable income levels.

The US has higher wages than: the UK, Germany, France, Sweden, the Netherlands, Finland, Austria, Belgium, Spain, Portugal, Japan, Taiwan, South Korea.

True, but considering with that high income no education assistance, medical insurance, or job-loss insurance, you can easily half the average income and then see actual disposable income.

also "subprime financial products bundled together and resold as low-risk investments to massive institutions" combined with "moral hazard" of said institutions knowing they will be bailed out again by the taxpayers when the speculative bubble bursts.

also Student Debt cannot be forgiven in bankruptcy so you essentially have an entire generation of indentured servants who will never actually own property outright.

>also Student Debt cannot be forgiven in bankruptcy so you essentially have an entire generation of indentured servants who will never actually own property outright.

This is an issue, but can vanish with the stroke of a pen.

A pen being wielded by a man with no desire, or knowledge, or forethought, to do so.

You are forgetting that if large enough section of the population is wronged/backed into a corner, they are going to protest/rise/riot. It certainly seems to be heading that way...I would be seriously worried if I were one of these student loan companies that are giving loans to people with no prospect of getting paid back.

Student loans are now almost entirely held by the taxpayer.

More likely we'll see more forms of non-dischargable consumer debt. This is debt which is not discharged when someone declares bankruptcy.

Every time you hear a politician advocating more student loans (rather than more affordable higher ed), one of the reasons they do this is because student loans are non-dischargeable.

Think about someone who is 18 and takes on lots of debt. There would be very little reason not to declare bankruptcy, and just live off of wages for 5-7 years until the bankruptcy is cleared from his/her credit report.

With the housing crisis, most debtors also owned some equity in the house, which was a massive incentive not to foreclose, yet many still did.

But with consumer debt there is no downside. You can just choose not to pay it. The collections industry uses some marginally-illegal tactics to create personal embarrassment, but that's where it ends.

With an auto loan the car can be repossessed, but you can pay your rent using a credit card or buy a new TV every few months and if you fail to pay back the debt nobody is going to force you to give up those items. As with education, once the money has been used nothing the creditor does can take away the item, which is why the debt had to be made non-dischargeable.

I think we can look forward to a new class of non-dischargeable consumer debt which will initially be sold via lower interest rates, but will become the sort of debt that college campus credit card pushers will mainly be slinging.

There is really no political opposition to this anymore, now that both parties are so strongly aligned with the finance industry.

I'd also expect to see the credit report become something somewhat more like a "trust dossier" that would routinely be viewed by employers and other entities we all work with who do not typically view the data, and would include things like TSA precheck status, IRS timely filing information, immigration status, etc.

There's a reason debtors prisons used to exist, which is that the human optimism that can get us through great hardship can also tend to lead many humans to be overly optimistic about their ability to repay debt. It takes a very firm hand to create compliant borrowers. In the US, the older generation views missing a credit card payment as a really big (and embarrassing) deal, but the younger generation does not care as much about this.

The occupy movement was a backlash against the shackles of student debt, but was shut down relatively efficiently. The next iteration has fewer principled objectors but a lot more debt cynics who view consumer debt more as something to be exploited.

Defaulting isn't a big deal even to the banks. They can just price it into the product.

What would be interesting though would be credit offerings, cards for instance, that are not dischargable, but with better terms or interest rates.

My concern though is mandating classes of debt as non dischargable by law, banks wont necessarily pass the savings along to the customer, so the laws should allow certain types of debt to be dischargeable but subject to your agreement with the bank. So you get a non dischargeable card at 2 pts less than the normal one.

> Defaulting isn't a big deal even to the banks.

True, but the ceiling on the amount that can be loaned to a person is limited by the market-driven interest rate for packages of dischargeable debt.

> not dischargable, but with better terms or interest rates

Yes, I think we'd see aggressive refinancing offers and all sorts of other semi-dark patterns... which would be irrelevant to the 98% who don't declare bankruptcy, but likely quite life-changing to those who do.

There are debt forgiveness programs like PSLF that I expect to become wildly more popular in the future. We're only ever a Presidential election away from dramatic changes to student loan treatment.

And with that the risk of the permanent destruction of the market for student lending in the future, meaning college will go back to being a upper-class game.

There is no "market" for (undergraduate) student loan lending any longer, AFAIK. The whole shebang is run by the Department of Education.

If there wasn't so much student-loan money available, would there be more incentives for some colleges to reduce their costs and make their product more affordable.

Right now, colleges provide the service (education) and credential (degree). If independent third parties could provide believable credentials, there would be more incentives to find cheaper ways of delivering the services.

Exactly, I think another way of describing this is a bubble.

Does America really have low wages? Granted, the lack of a minimum wage is crazy, but the median household income is $56k. Compare that to £23k in the UK.

You are comparing pre-tax income (USA) and post-tax (UK)! You also mixed your units. TO use net-adjusted disposable income, USA has 41k USD and UK 28k USD. Also, you'd need to adjust for the benefits you get from your government/employer (Health insurance) for a fair comparison. While American workers earn more than UK workers, that does not necessarily imply that the total cost of employment for UK employers is lower than total cost of employment for USA employers. I don't have that data handy.

> you'd need to adjust for the benefits you get from your government/employer (Health insurance) for a fair comparison

Indeed. My out of pocket for medical care this year is $19k (and that's with one of the "gold" plans)

But how much is it compared to your salary? I pay 33% of my income just for Healthcare. Or well, government just takes it :)

I won't give exact numbers, but somewhere between 10% and 33%. :-)

But for a typical developer, that would be in the neighborhood of 20%.

Where? UK is 0-10% of taxable pay depending on how much you earn.

A lot of people don't have guaranteed retirement benefits, education is expensive and sickness can cost you a lot of money any time. When things go well you can live well in the US but things can go bad quickly.

That's also true in many other developed nations in regards to education, such as Canada, Japan and Britain, which have between moderately and very expensive education systems. Britain for example now has arguably the most expensive university costs:

https://www.theguardian.com/education/2015/nov/24/uk-has-hig...

"Britain has the world’s most expensive public university tuition fees, surpassing the average in US equivalent institutions. While student fees can be higher at many ivy league and other top colleges, the £9,000 annual charge for attending an English institution pushed the British average above the US’s public colleges for the first time, the Organisation for Economic Cooperation and Development said."

http://www.ft.com/intl/cms/s/0/62a1d4e0-9213-11e5-bd82-c1fb8...

Are suggesting that the US does not have a minimum wage?

I assumed so given all the comments I've read about people getting paid $2/hour. I stand corrected!

It is minimal, though: $7.25/hr federally.

Wages aren't doing so hot vs cost of living, and they're quite bad vs productivity. If we're better off than other developed nations, that's a dubious consolation.

We have a minimum wage. It's $7.25/hr at the Federal level, so that's the baseline.

I don't know why you're being downvoted, this is accurate.

The idea that this was ever downvoted at all is very strange. What is happening to HN?