Thursday, July 21, 2011

Will college bubble burst from public subsidies?

We are still suffering from the bursting of the housing bubble created by low interest rates, lowered mortgage standards, and subsidies to Fannie Mae and Freddie Mac. Those policies encouraged the granting of mortgages to people who should never have gotten them — and when they defaulted, the whole financial sector nearly collapsed.
Now some people see signs that another bubble is bursting. They call it the higher-education bubble.