Contrast with the worldmhmeln_57March 18 2004, 07:29:29 UTC
The article compares an American Kid to a Japanese young person. the difference between the US and the rest of the world is that we have everything on a more inflated level. we charge more for all the services, but the money stays in the system. We have the most expensive education system, but we also have the highest salaries in the world. Europeans can't afford to have big cars, big houses, etc. Neither can the Japanese. While it is true that Americans live in debt, that debt is not at all bad. i am happy with my debt. my goal is to die with as much debt as possible. i wish i could prolong my student loans (i think i have a lot more than an average American Kid) till much later in life.
Another little statistic that was omitted in the article. Law School (and a business school) will put you in debt for 80 - 100K. However, the STARTING salary in tons of law firms is now 125K. Not too bad, eh. Maybe it PAYS OFF not to flip burgers and not to serve tables, and TAKE that internship, project, etc.
the problem, however is with the low-paying industries. That is where the youth, and sadly, America is hit hardest. Educated civil service employees, such as teachers, public defenders and prosecutors are so underpaid, that many people can't afford to go in there. Which takes away the pool of knowledge and intelligence from those fields. That, in the long-term will be a disaster, with financiers, programmers and lawyers getting a lot of money (and a lot of "applicants"), yet educated, intelligent teachers becoming an extinct species.
Going back to the world, however, we are still better off, because we have the $$ for the loans. And one too many people break through, get those high salaries, and get that house in the 'burbs, desired (sic!) commute in a quiet, non-graffitti-decorated train where you can always get a seat, and a high-paying job. Because we have so many loans, we also have so much money in our system, money that pours down into our accounts through direct deposit of higher salaries.
the picture is no so grim, after all. although, the longer we have the shmuck in the government, the closer to Japan we will get. After all, we do need a constant supply of money into the system. :-)
Re: Contrast with the worlddalonaMarch 18 2004, 12:04:42 UTC
About lawyers and salary: if average loan is around 100K and salary is 125K than they are in the same situation as the rest of the student. Having average loan 40K(masters) I need salary at least 90K to pay off the loan in 5 years. I'm not that optimistic about salary which I will get (or economy and market--whatever you call it), so I hope to pay off my loans in 10 years. By that time, according to the article, following american dream, I should already have a stable nice job, house, car--meaning enough money to buy all that. NOt just get to the line of flat broke. For me that is scary.
Re: Contrast with the worldmhmeln_57March 18 2004, 13:12:49 UTC
why is the point of 0 loans considered to be the "normal" point? let's assume that we spend our entire lives in debt. Therefore, "normal" position is $xxx,xxx in debt. From that point on, the purpose is not to get out of debt, but to break even and sometimes have surplus.
This, on a big scale, is how all of American (and world) industries work. GM is barely breaking even with all the loans that the company has (in the form of bonds). the only well-known company without public debt is Microsoft, and that's an anomaly.
So if we take as "normal" that we are in debt, there is no harm in having student loans, car loans, mortgage and other loans to your name. As long as you can make enough per period A not to default on these loans, you should not worry about the loans. and if your budget is getting too tight with the loans, spread them over a longer period.
Nobody expects GM to pay off all the debts. as soon as they do (buy back bonds of one issue), they issue new debt. For many, many years ahead. What's wrong with that picture, again?
Re: Contrast with the worldiluxaMarch 18 2004, 14:00:40 UTC
well, that's kinda how it is, right? what you're pointing out is how large businesses work. running those businesses is always a race to keep just enough cash coming in to cover the loans. and that's how lots and lots of people live, sure.
"normal" is a very overloaded word. being always in debt is how life is stacked up right now in the US. essentially, if you want to be ambitious, you need education, which starts you off with debt. and if you want to continue to own the things that you're "supposed" to own at your age, you put on more debt. having a car, a house will just add more debt. so it is your choice - if you go that way, you will always have to work, and you will always be very dependent on your job. that's what's scary for me. that between education, car and house loan, if you haven't got a job for like 4 months, you're defaulting on your loans. and that basically means this "lifestyle" you've built up - car, house, etc - is all taken away from you.
so you can say that living in debt is "normal", but it's almost like living on credit. you're ok as long as you can keep making the payments. in one way we all do this to some degree.
but you've got to decide for yourself to what degree you want to do this, right? like maybe i'd like to at some point not have any debt. maybe, even though the interest rates are low and my american dream tells me that i need my own house, i actually choose not to buy one. and then eventually i could get to the point where i have my own car and my own apartment (whatever) that's actually MINE, and I'm not afraid of losing them because I'm just borrowing the money all the time for it. it's really stressful to live like that, i think.
Another little statistic that was omitted in the article. Law School (and a business school) will put you in debt for 80 - 100K. However, the STARTING salary in tons of law firms is now 125K. Not too bad, eh. Maybe it PAYS OFF not to flip burgers and not to serve tables, and TAKE that internship, project, etc.
the problem, however is with the low-paying industries. That is where the youth, and sadly, America is hit hardest. Educated civil service employees, such as teachers, public defenders and prosecutors are so underpaid, that many people can't afford to go in there. Which takes away the pool of knowledge and intelligence from those fields. That, in the long-term will be a disaster, with financiers, programmers and lawyers getting a lot of money (and a lot of "applicants"), yet educated, intelligent teachers becoming an extinct species.
Going back to the world, however, we are still better off, because we have the $$ for the loans. And one too many people break through, get those high salaries, and get that house in the 'burbs, desired (sic!) commute in a quiet, non-graffitti-decorated train where you can always get a seat, and a high-paying job. Because we have so many loans, we also have so much money in our system, money that pours down into our accounts through direct deposit of higher salaries.
the picture is no so grim, after all. although, the longer we have the shmuck in the government, the closer to Japan we will get. After all, we do need a constant supply of money into the system. :-)
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This, on a big scale, is how all of American (and world) industries work. GM is barely breaking even with all the loans that the company has (in the form of bonds). the only well-known company without public debt is Microsoft, and that's an anomaly.
So if we take as "normal" that we are in debt, there is no harm in having student loans, car loans, mortgage and other loans to your name. As long as you can make enough per period A not to default on these loans, you should not worry about the loans. and if your budget is getting too tight with the loans, spread them over a longer period.
Nobody expects GM to pay off all the debts. as soon as they do (buy back bonds of one issue), they issue new debt. For many, many years ahead. What's wrong with that picture, again?
Reply
"normal" is a very overloaded word. being always in debt is how life is stacked up right now in the US. essentially, if you want to be ambitious, you need education, which starts you off with debt. and if you want to continue to own the things that you're "supposed" to own at your age, you put on more debt. having a car, a house will just add more debt. so it is your choice - if you go that way, you will always have to work, and you will always be very dependent on your job. that's what's scary for me. that between education, car and house loan, if you haven't got a job for like 4 months, you're defaulting on your loans. and that basically means this "lifestyle" you've built up - car, house, etc - is all taken away from you.
so you can say that living in debt is "normal", but it's almost like living on credit. you're ok as long as you can keep making the payments. in one way we all do this to some degree.
but you've got to decide for yourself to what degree you want to do this, right? like maybe i'd like to at some point not have any debt. maybe, even though the interest rates are low and my american dream tells me that i need my own house, i actually choose not to buy one. and then eventually i could get to the point where i have my own car and my own apartment (whatever) that's actually MINE, and I'm not afraid of losing them because I'm just borrowing the money all the time for it. it's really stressful to live like that, i think.
Reply
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