The debt ceiling agreement includes a provision that restarts student loan repayment 60 days after the bill is signed. This is going to suck money out of millions of Americans who haven’t paid student loans for 3 years. This is significant considering student loan repayment cannot be circumvented as they will go after your wages and garnish it.
The average America consumer is already scraping by due to high inflation. The student loan will finally be the nail in the coffin for this irrational market
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Which willcome first? The recession or Grand Theft Auto 6?
You must be new here. Millions of poor people struggling to pay bills does not make the stock market go down.
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EDIT: This comment got more attention than I expected. I suppose I may as well add some intelligent substance: Increased economic hardship will likely lead to reduced inflation and lower interest rates. Lower interest rates will drive up the markets (and wealth consolidation) further. Stonks will go up. This is not a comment on what’s right for society. This is just a statement of the likely outcome based on past market behavior.
Everything is bullish now. NVDA to $400 on Tuesday regardless of news. Doesn’t make sense.. just goes up.
In walking dead, do you think the zombies would survive in Kansas if there were tornadoes?
Couple of storms and you get back to life as normal
The market is made of money by the 1 pct folks and if you think some people with their salaries docked will affect this then don’t.
Also, P/E ratio will continue to be irrational based on hocus pocus.
This is actually bullish and the market will continue to moon.
There is no data at all that can cause the market to crash, a nuclear explosion in Kansas would be interpreted as bullish due to less consumer spending and thereby decreased inflation leading to rate cuts.
Nah, as someone with over $30k in loans this was going to happen eventually. The loan forgiveness is still on pause and should be heard next month. Regardless, the Biden administration has declared multiple times that loan deferment would end a month after the decision had been made or some arbitrary date I forget.
The resumption of student loan payments will certainly suck a lot of money out of discretionary spending, which should at least help to combat inflation
So the feast is on for two more months then vacation in Vegas, got it.
90% of the market is owned by institutions. Student loans don’t matter.
Highly doubt student loans are going to effect how institutions trade the market.The people who have student loans don’t make up .00001% liquidity of the market.
Get rekt
I bet it’ll take money out of the market, but the question is how much. I think it’ll be more than some think, but don’t know if it’ll be enough to actually crash the market.
Though I am curious what will actually end up happening with the economy and the market because of the pause ending and if it’ll end up spilling into other things as well.
As for businesses finally getting paid due to the end of the pause, that could go either way. It people simply don’t have the money then they still won’t be able to pay.
You assume the millenial poors with clown college degree student loans were propping the market.
Markets are worried about there being too much money out there causing inflation. Sucking money out of millions of Americans helps solve that. And that money that gets paid back can then be invested elsewhere. A policy which reduces overall consumption and increases savings and investment is disinflationary.
Reinstating student loan payments = reduction in consumer spending = reduced inflation = Fed slowing/stopping rate hikes = stocks market goes brrrrrr
Or not. Who the fuck knows.
This is bullish. Demand side inflation will be gone when people have to pay their loans. Fed will cut rates.
I’ve been called a doomer.
But I don’t think this will impact it. We all had shitty student debt previously, and bitched and moaned and complained about it for years.
The pause was always temporary, if people decided to spend outside their limits because they expected the debt to disappear that is their problem. But I don’t think that many people will
Have irrationally acted on the pause. Plus if they were seeking additional loans, and if it were THAT detrimental, they would not have been approved for those loans as the student debt was still on their record.
Spoken like a true student with a loan!
Bears grasping at straws now. Pretty entertaining.
Good, maybe fuckers will stop buying houses, or they’ll be forced to default on their mortgage and we’ll finally get a housing collapse.
Jesus christ man, it’s about time.
The supreme court is about to spartan kick student loan deferment and likely executive power. It’s obvious to all but the most partisan, student loan forgiveness needs to go through the legislative branch.
Restarting payments in 60 days prior to that event will mitigate that.
Which… Is a net negative because executive power should be constrained.
You can always tell who is new to trading
99% of the people that weren’t making interest free payments on their loans were the ones that gambling their money away on meme stocks and options. Market may go down but it won’t be people paying back their loans that does it.
>This is yet another example of how the rich get richer and the poor get poorer in America. The student loan provision in the debt ceiling agreement will only benefit those who can afford to repay their loans, while leaving everyone else behind. This is unfair and unjust, and it needs to be stopped.
Pay back what you owe. Pay your bills.
Actually you don’t pay student loan debt when you die, it is just forgiven. So there is a way you can circumvent the debt, technically.
Why people are talking about resuming the student loans payment like they are going to bankrupt everybody and their mother.
Were all people with this debt paying 90% of their salary after taxes before? Serious question.
Student loan repayment will move funds from consumers to the financial sector, which will slow the consumer inflation that worries the Fed and promote the asset inflation that gratifies us investors. Win, win.
Why haven’t they paid anything in 3 years is my question.
Bro enough with the market collapse post – we get it, your all cash and missed the run up now you are praying for a crash to justify your move so you can tell everyone ‘I told you so.’
Jump back in now or wait til we back at ATH and fomo in later. Or just stay on the sidelines forever.
I remember so many people bragging about how they had ALL the money for their loans sitting in the bank account, but they didn’t want to pay them down because they didn’t have to….
Ya thats what you get when you’re degen with your finances.
> This is significant considering student loan repayment cannot be circumvented as they will go after your wages and garnish it.
Ha ha, I like how you not so subtly hinted that if this was any other kind of debt, folks could just simply delete their app.
Anyway, I hear ya, but in all seriousness, folks used the money, they had 3 years to get their wallets in order, and now they must pay what they owe. This is how the real world works, and folks need to start taking responsibility for their actions… there are no free lunches.
UVXY resurgence
$SOFI shareholders doing a dance.
Market is basing now and will go higher. Shorts will get crushed
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I get what you’re saying – you’re right. Can’t really argue. I haven’t been following this closely. My question is – was interest suspended during these past 3 years?
Either way – people should have continued to pay off their loan. I saw some number like 99% of people stopped paying. Or they should have been saving that money and setting it aside. I know that’s easier said then done – and I can’t speak for everyone – but I personally know of a lot of people who actually put themselves in a worse financial position. They took the opportunity to spend their money on other things – buying homes, taking vacations, new cars, etc. All things they probably wouldn’t have done if they had continued to pay their student loan. I can’t say I blame them – but loans had been paused for so long many people started making financial decisions as if their loans were going to be completely wiped clean. And then to make matters worse – inflation explodes and sucks everyone dry. Now this. This is just going to absolutely bury some people.
I don’t have a source but I saw some crazy reports that something like 50% of people defaulted on their student loans before the covid shutdown even happened. Saw some people in the news that were just like – “nah. I don’t want to pay that”. and some of these people were ones that could afford it. They just wanted to spend their money on other things.
OP you’re laughably wrong about this. If someone who owes federal student loans (the loans in question here which are currently paused) actually cannot pay their loans, then they need only get on an Income Based Repayment program, which is quite generous. If they are unemployed or relatively low income, their payments will drop to $0 per month and interest will not accrue. After a number of years, the loan is forgiven.
I know dooming is a gratifying narrative but it is toxic because it keeps people ignorant about the options they have. Shame on you.
Kinda weird that the focus is always on raising the debt ceiling instead of working together to lower it tbh
Yes. I’m sure what was propping up the entire US economy was the…checks notes…13% of America that have any level of student loan debt at all.