I am very confused with this one. Can someone explain what President Obama is thinking here?
Beyond the obvious of buying votes?
While making a speech to college students yesterday Obama said allowing interest rates to double this summer would hurt more than 7 million students, costing the average student $1,000 and amounting to a “tax hike” for those students and their families.
A tax hike? You have got to be kidding me. Where did I go wrong? I was brought up to believe that one should work hard to pay off his or her debts at all cost. A loan agreement was meant to be a legal contract between two parties, borrower and lender, with specified terms of interest and repayment entered into freely by both parties. If I agree to borrow money at said terms how is it a “tax hike” when the more onerous terms of that contract kick in? When did the government become an interested party in a contract between borrower and lender?
Ok so the terms of the freely entered into loan are now a tax hike and the terms of the original contract are null and void by virtue of the government. So as an investor why would I lend to Sally when the repayment of my principal and interest for that matter is subject to the whims of government? Young Americans will be freed from the terms of their loans but who will take the loss but the end investor. Please remember it is a zero sum game. Now if the investor or market will not lend who does that leave but the government and where do you think they will go to get that money? If no one is lending we have much bigger problems than student loans.
Is it possible that individuals may have borrowed more than they could chew? Call me old fashion but is it wise for individuals to do that? Are there not alternatives to Notre Dame? All the old war stories of people walking both ways to school with no shoes uphill, both ways. I have even been told stories of folks working a job or even two while they went to school. People have been rumored to go to community college for two years and then onto University. Isn’t it better to work hard for what you have than to live via a sense of entitlements? State School has worked out well for me.
I am not sure where I went wrong but it seems rather crazy to me. Let me get back to work and save for my four wonderful children to go to college without the help of their Uncle Sam.
onepercentorbust 