Originally Posted by Dude
There's minimal risk to the lender, because educational debt cannot be discharged in a bankruptcy. That makes this an attractive can't-miss investment opportunity. Any (minimal) risks can be offset by insurance and default swap purchases.

Plus, tuition can only go up!

Sound familiar?

You cannot properly apply the topography of a stock market, housing, credit, or tulip bubble to higher education.

Why?

Because it is not a commodity that can be traded and bid up.

There is some sort of inane illogical economic topography in higher education, but it is not that of a bubble.

This mechanism has already reversed for law school, which may or may not be a bellwether for the rest of the higher education system.

The decline in law school applications was caused by a recognition by an increasing number prospective law students that law school is not a good investment, partially due to an increase in actual transparency regarding employment prospects.

The supply of credit for law school remains effectively infinite.