Before we celebrate the arrival of 2012 American’s will be strapped down with $1 trillion in student loan debt, making those loans the country’s largest source of debt, surpassing credit cards for the first time.
The $1 trillion mark was announced in figures provided by the Federal Reserve Bank of New York and they show that student lending has more than doubled in the last 10 years, even after the number was adjusted for inflation.
In 2010 the report shows that students took out $100 billion in new loans, the first time that lending amount has been reached in a single one year time period.
It shouldn’t come as a surprise that the loans have become a big draw for investors, specifically banks since Congress has made it nearly impossible to write the debts off, for example they can not be forgiven in bankruptcy court.
Speaking about the student loan problem Seeking Alpha blogger Nick Pardini wrote that these loans could be “the next major credit bubble” while calling the current generation of loans a scenario that is going to “create a generation of wage slavery.”
In the meantime some Occupy Wall Street protesters have been gaining support for a petition that would ask the U.S. Government to forgive all current student loans, a scenario likely to fail considering the huge amount of loans that continue to be generated via governmental and private student loan programs.