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No, the federal government does not profit off student loans
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Date: May 20th, 2013 6:41 PM Author: overrated razzle-dazzle den http://www.washingtonpost.com/blogs/wonkblog/wp/2013/05/20/no-the-federal-government-does-not-profit-off-student-loans/?print=1 (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237493) |
Date: May 20th, 2013 6:55 PM Author: Contagious Nursing Home Electric Furnace he acts like a "default" on a student loan is the same as a default on any other type of loan. makes a big deal about these loans being riskier than t-bills, pointing at the current default rate of 4% to 5%. but that's bullshit because they can't be discharged in bankruptcy and the government can garnish wages up to 20%, so there's little to no charge off expense. (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237531) |
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Date: May 20th, 2013 6:57 PM Author: cyan marvelous orchestra pit he also doesn't prove his point. he cites some discrepancy in methods being not reliable but doesn't tie it in to there not being a profit. (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237537) |
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Date: May 20th, 2013 7:00 PM Author: Contagious Nursing Home Electric Furnace and no mention of the profits recorded by STU and SLM over the last 5 years on their enormous FFELP loan portfolios. if they were making billions, why wouldn't the government? (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237548) |
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Date: May 20th, 2013 7:01 PM Author: bat-shit-crazy volcanic crater (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237556) |
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Date: May 20th, 2013 7:03 PM Author: ocher startled trailer park pisswyrm gov was still guaranteeing the defaults (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237566) |
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Date: May 20th, 2013 7:05 PM Author: Contagious Nursing Home Electric Furnace there's not much difference in a federal guarantee versus non-discharge-ability and wage garnishment. the only true student loan defaults are when the person dies, like in these cases:
http://www.huffingtonpost.com/c-cryn-johannsen/student-loan-debt-suicides_b_1638972.html |
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Date: May 20th, 2013 7:06 PM Author: ocher startled trailer park pisswyrm the difference is getting a $20k check from the gov when the kids defaults v. having to chase his ass for the next 30 years - the servicing costs on the latter are substantial (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237580) |
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Date: May 20th, 2013 7:10 PM Author: Contagious Nursing Home Electric Furnace ok, but this difference is insignificant. even if you lopped off 10% of the profits those lenders made they still make billions. (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237609) |
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Date: May 20th, 2013 7:12 PM Author: Chocolate Hilarious Legal Warrant Tanning Salon "the servicing costs on the latter are substantial"
And tacked onto the non-dischargeable loan. |
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Date: May 20th, 2013 7:36 PM Author: bat-shit-crazy volcanic crater (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237757) |
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Date: May 20th, 2013 7:00 PM Author: Henna embarrassed to the bone business firm doctorate this is a dumb accounting gimmick.
it assumes student loans come from treasury inlays. one could just easily argue they come from fed taxes in which case all interest is govt profit |
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Date: May 20th, 2013 7:11 PM Author: ocher startled trailer park pisswyrm even if the taxes are $0 cost, you need to take into account interest cost in determining a WACC for the Treasury (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237615) |
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Date: May 20th, 2013 7:16 PM Author: Henna embarrassed to the bone business firm doctorate I have a HELOC that charges 5% interest and I lend out to lendingclub at 12%. If instead, I lended out at 3%, less than the HELOC rate, I would still be making a profit. My ability to lend to lendingclub is tied to my salary, not the HELOC.
Unless this implies the government is flat broke and basically playing arbitrage between Treasuries and student loans. |
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Date: May 20th, 2013 7:12 PM Author: Chocolate Hilarious Legal Warrant Tanning Salon "And because they’re below the market rate, that costs the federal government money."
This is fucking retarded.
There would be an opportunity cost, but that's not what people are talking about. |
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Date: May 20th, 2013 7:36 PM Author: Learning disabled fantasy-prone laser beams Solid boomer flame (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237756) |
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Date: May 20th, 2013 8:11 PM Author: silver laughsome dilemma macaca Shocking that KIKE is sucking the dixk of the Feds. (http://www.autoadmit.com/thread.php?thread_id=2261420&forum_id=2#23237925) |