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Originally Posted by someone123
It's actually even worse because the average value of a degree has also fallen and minimum/low wages have been falling in real terms for years. That BA that costs $8000 a year really does not distinguish you much in the workforce and even if you take a retail job or something you are not going to be able to avoid debt unless you get other help. Top students can still do very well, but the people who previously might have just done pretty well in high school and then maybe or maybe not gotten a BA or something are much worse off paying tens of thousands before getting a low-paying white collar job.
This is going to have pretty bad consequences for the economy, particularly in the US (land of $40k tuition and no jobs) when it turns out that 32 year olds are still paying off student loans instead of buying cars and houses. And even if somebody at that age does buy a house, they'll be paying it off for a long time if they're in one of the more expensive housing markets.
I won't be surprised if, looking back in 30 years or so, there will be a marked decline in living standards between baby boomers and those who graduated around 2008 or so.
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Very good analysis... I am one of those 2008 grads. I don't know what the long-term impact will be in living standards. Where is all this baby boomer money going to go? The whole occupy movement seems funny to me because it seems to be more generational than Wall Street specifically... middle-aged white people are the ones investing in the stock market. Sure, the gap has increased between the rich and poor, but it also has blown wide open on the young vs. the middle-aged (those older than the baby boomers are getting screwed).
As the most representative years of generation y we should see a transfer of alot of this wealth at some stage, unless it is all lost in investment.
Although I'm sure the composition of actual university graduates has increased in the workforce due to younger staffing... and credential inflation somewhat implies that more of us know more than the people we will replace. Eventually generation y will become the baby boomers, as they will all have died, regardless of what people think the paradigm shift is going to be, there will still be gaps in the age sex pyramid unless immigration fills that in.