Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

Re:Student Loans a Lot Like the Subprime Mortgage Debacle, W... by avalys on Wednesday December 11, 2019 @03:25AM (#21760593)

You’re not comparing equivalent quantities. GDP is an annual figure (Gross Domestic Product), and you are comparing it to total outstanding debts that are paid off over decades.

Total asset value of the US economy is about $270T with about $150T in outstanding debt. So the relative proportions are not as extreme as you’re representing.

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Re:Student Loans a Lot Like the Subprime Mortgage Debacle, W... by apatters on Wednesday December 11, 2019 @03:29AM (#21760618)

I knew there would be some sort of issue with that comparison, thanks!

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Re:Student Loans a Lot Like the Subprime Mortgage Debacle, W... by the-dude on Wednesday December 11, 2019 @04:01AM (#21760764)

If the value disappears overnight, wouldn't it be fair to compare it to the yearly figures?

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Re:Student Loans a Lot Like the Subprime Mortgage Debacle, W... by ssivark on Wednesday December 11, 2019 @06:12AM (#21761431)

If it disappears "overnight", then would the right comparison be to daily GDP? which would increase the computed percentages by a factor of 365.

Clearly it is not sensible to compare two quantities with different dimensions of $ and $/time. It is like comparing distance (miles) to speed (miles/hr). Changing units to (meters/sec) doesn't change the absurdity in any way.

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Re:Student Loans a Lot Like the Subprime Mortgage Debacle, W... by the-dude on Wednesday December 11, 2019 @09:07AM (#21762405)

I run a business. If I had to 'write off' some asset today because it has proved to be worthless, it will affect the yearly report.

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