Posy from MyMoneyBlog.
The post shows graphs of the Education bubble compared to the housing bubble and the huge increase in healthcare costs.
Kind of interesting. Clearly all of these cost increases can be largely explained by the available of easy debt.
I commented on this before when we were looking for a neurosurgeon for dh's surgery. My MIL is crazy, so who knows, but she swore that a #1 surgeon in LA would only charge $10k for the surgery, and would even travel up north to do so. This was his fee - our insurance would cover the rest of the surgery and recovery. (HE didn't make us the same offer so lord knows if this is really true - she is on another planet sometimes). But, the whole thing sounded very weird to me. But then you think about it. For the last decade people haven't thought twice about cashing in their equity to afford the best doctors for any medical procedure, etc., etc. Heck, I know a pile of more lower class/lower middle class moms who have been getting boob jobs and tummy tucks. Price is no object when you have $100k equity at your disposal.
Suddenly the gravy train has run its course, and $10k cash in hand is better than the $30k that no one can afford?
OF course, the point of the post was that education is the BIGGEST bubble. By a mile!
Well, that isn't very surprising. Do we know very many people who have really considered the financial ramifications of their college choices? I personally feel like one in a million, with my own very practical approach to college. The prevailing attitude is that "It doesn't matter how much it cost - it will be worth it."
Isn't it amazing how wide reaching and devastating the affects of the debt bubble were? It's just mind boggling.
August 31st, 2010 at 04:55 pm 1283270121
Regarding the cosmetic surgeries, I think that is/was done far, far, far, far less here in the midwest. Doesn't mean some people take out equity loans; they just spent it otherwise-- sometimes on that college tuition for the kids. Feeds the monster, doesn't it?
August 31st, 2010 at 05:55 pm 1283273728
I am defeated by the college tuition issue. Reform needs to happen. In the 1970s and even part of the 80s, you could pay for an entire year of tuition by working full time in the summer. Now, that would never happen. I had to take on 40k in loans to finish my degree. This, and I worked full time, paid my own way AND paid at least $200 a month out of pocket directly to the school to keep the loan amount down. It's ridiculous.
I finally paid them off in 2009 (graduated in 2001). All of these folks with 100k in loans for English degrees? Well, that's really sad. College doesn't guarantee you a job, or a nice middle class life.
Now I have two children, and am dedicated to helping them through college so they can avoid all the heartache I went through. All the experts say I need to put away $400 a month per kid. Who has that kind of money?
August 31st, 2010 at 06:44 pm 1283276685
August 31st, 2010 at 06:56 pm 1283277387
Current tuition at same school = $2475 for 15 credit hours.
That is just insane!!!
August 31st, 2010 at 08:04 pm 1283281478
A house? An education? Pffft. Those are bubbles I have refused to partake in.
August 31st, 2010 at 08:19 pm 1283282394