Student Loan Consolidation
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Wall Street Journal Blames Congress For This Mess

Yesterday the Wall Street Journal reported on the student loan
crisis brewing in the United States, blamming the legislature for
passing the “College Cost Reduction and Access Act”, last fall.

This act reduced the interest rate paid by borrowers of Federal
Guaranteed Loans. Next congress convinced private lenders to
cut the rate for Stafford Loans by .70 Basis Points & cutting the
popular Consolidation Loan Products by .65 Basis Points. 

The problem is, this action reduced profit’s in these products
making them less disierable products for investors who purchase
these assest backed securities. These are the market makers who
keep this wheel spinning. Without them, the wheel stops.

Now congress, ( The Same Guys That Caused This Mess ), are in
the process of putting together a Tax Payer Bailout to fix there
mess. The bill proposes that the Department of Education would
purchase those loans ( And There Risk !!! ) from the lenders with
tax payer money.

Perfect example of why our Government has no place in trying to
control prices in a Free Market Economy.

We will keep you posted.