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So is the credit crunch a good thing?

August 3rd, 2009 at 09:47 pm

Is the way CC companies are closing down lines of credit just a return to fiscal sanity? Will it force people with debt problems to bite the bullet and get 'em paid off?

I have mixed feelings, but in the long run it's probably a good thing. They got some of us hooked on crack and now they have withdrawn it suddenly.

So my big question is will colleges respond to supply and demand, and lower their prices as people who used to depend on student loans are denied en masse? My feeling is no, they will behave more like government, where the only way to cover their uncontrolled expenses is to keep jacking up the price. At least until people figure out alternatives to college.

6 Responses to “So is the credit crunch a good thing?”

  1. Broken Arrow Says:

    Good thought.

  2. baselle Says:

    It is true - college expenses are another bubble. Spending $150K on a brand-name undergrad degree that will get you a starting salary of 30K (if you an entry level job in your field) is just as unsustainable as a 300K house on a 50K salary.

    Colleges will adjust, but funny enough, they probably won't get rid of administrators, they'll probably get rid of profs.

  3. Apprentice Bliss Hunter Says:

    This crisis has a lot of good aspects...

    hopefully people will change their behaviour and develop healthy financial habits that will last for life...

    your credt/crack metaphor is very apt....

  4. ralph Says:

    That's probably because I stole, er, borrowed, it from Maxed Out, a most excellent audio book.

  5. ralph Says:

    Just as a clarification, it turns out that a collection agency slapped a negative item on my credit report due to one of those medical/insurance fiascos where the consumer gets caught in a pissing match between a doctor and an insurance company, even though we have an HMO and are liable only for the co-pays as long as we follow all the rules and we do. I am livid with that doctor's office.

    And I'm also pretty upset that a lender can't/won't see that for what it is and uses it to refuse credit. Groupthink/sheep/CYA behavior at its finest.

  6. Jerry Says:

    I get so frustrated at the go-betweens of doctors and insurance companies, and it has really lead to problems for our family in the past. Usually it is the insurance company who gets me all mad, but sometimes doctor's offices can be idiotic. We are now living overseas and it's a lot different over here. Not perfect, but a lot different.
    Jerry

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