Student Loans: The Debt that keeps on Taking

[RE]

The Student Loan fiasco, which has been building ever since the first Federally Guaranteed Loans for poor and middle class kids to get enough up front money to join rich kids in the private and public universities during the Vietnam War and avoid being Drafted as cannon fodder in 1965, has entered yet another phase on the way toward its inevitable implosion.

As of the 1st quarter of 2023, total student loan indebtedness stood at $1.77 TRILLION dollars.  About 10% of those borrowers are ALREADY in default, with many more barely hanging on.  During COVID, debt repayment was suspended with no penalty, and Uncle Joe has been trying to fulfill a campaign promise about debt forgivenes since his election as POTUS, but has not surprisingly faced stiff resistance to the ideas.

Now, as repayments are scheduled to begin again, 25% of theDebt Slave former students say they will boycott the monthly coupon they are supposed to tear out of the little book and send to the bank with a check to cover the bill.  If this was evenly distributed, that would be around $420B worth of Defaults.  Except probably it's the ex-students with the biggest debts who will boycott, so I guess conservatively we are talking a $600B default.  Remember, AIG defaulting back in 2008 was only $182B, which was catastrophic to the financial system.

The question is, will 25% of these borrower really refuse to pay, and if they do how will da goobermint go after them?  Will they freeze all their bank accounts?  We are talking Dentists and Doctors here with families and McMansions and Teslas in the garage.  Unless they can get their assets somehow, since the loans are goobermint guaranteed, they will have to bailout the banks holding this delinquent paper.

Should be fun.

RE

https://www.foxbusiness.com/personal-finance/student-loan-payment-boycott

A quarter of student loan borrowers said they'd boycott repayment

RE