A Bloomberg headline reads "Bankers Warn Fed of Farm, Student Loan Bubbles Echoing Subprime." (Warning: may be behind a paywall.) Can I say, "duh"? Can I say, "I told you so"? Sure I can. See here (for farmland) and here (for student loans).
Speculative bubbles have always existed in market economies. Government actions have always had economic ramifications. However, it's particularly unfortunate to realize that current federal actions are likely contributing to the creation of not one but at least two speculative bubbles.
FWIW, I have little sympathy for avaricious farmers who irrationally stoke the price of farmland. I have much more sympathy for students who don't perceive the risks of incurring nondischargeable student loans. Sympathies aside, I am particularly concerned about the effects on American taxpayers when these bubbles burst. Bailouts, anyone?
Speculative bubbles have always existed in market economies. Government actions have always had economic ramifications. However, it's particularly unfortunate to realize that current federal actions are likely contributing to the creation of not one but at least two speculative bubbles.
FWIW, I have little sympathy for avaricious farmers who irrationally stoke the price of farmland. I have much more sympathy for students who don't perceive the risks of incurring nondischargeable student loans. Sympathies aside, I am particularly concerned about the effects on American taxpayers when these bubbles burst. Bailouts, anyone?
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