Originally Posted by
Sardines
If the government is going to completely pay for students attending public schools an important question lies in how much they are spending and who are they going to be subsidizing? School pricing on education is conditional i.e. a high sticker price is issued to students in order to fund scholarships and merit awards for their counterparts who performed better. Figuring out a real price for the education is going to be an intense debate because the transaction model now is no longer a private interaction and funding will likely be kicked back to taxpayers and not be absorbed from government grants, since STEM and grant measures originated from the pocket of government good will in the first place. It's hard to imagine all the possibilities because it's a multi-faceted issue to be addressed. No one here is a school administrator nor knows how student tuition is invested into the University. Similarly, no one knows how much schools up scale their tuition with respective to the cost of maintaining their services.
With respect to CDO or CDS, there is going to be consumer panic and investors are going to short-term short their options resulting in reduced value. However, a gradual transition process and tight government controls and regulations would determine whether we are looking at another catastrophe or a short-term loss. If investors do not collectively attempt to jump off the ship at the same time when it is burning there should be liquidity as student loans are usually not the main feature of CDO/CDS culture. However, they are regarded as one of the safest investments.
Bookmarks