In his latest Breakfast With Davenote, Rosenberg points to another financial bubble that's keeping homebuyers out of the market: student debt.
From his recent note:
STUDENT LOANS – THE NEXT BUBBLE?
As the WSJ reports, the student default rate for loans taken on after October 2009 has jumped to 9.1% – double what it was five years ago. The federal government now estimates that about 20% of students who took on federally-assisted credit will end up defaulting in their lifetime. According to Pew Research, fully 40% of households headed by someone younger than 35 is saddled with student debt, with the average liability rising 14% from 2007 to 2010 to nearly $27k (in real terms).