Are we seeing a development of a bubble in law degrees and mbas?

Ensui · July 9th, 2009, 02:09 PM

HS Dent | Memo to Law Students: Take the Year Off!

I have a few friends that are either in law school or are lawyers and this is the first time they are seeing a downturn in their industry. With an increasing number of applicants accepting their offers into law school are there going to be too many lawyers down the road? The same fundamentals apply to mbas to an extent. Scary....

lattes · July 9th, 2009, 02:52 PM

The MBA explosion is one of the most ridiculous things I have seen.

Initially the MBA was developed for people with Science degrees who were going into the business world.

Having 25 year old kids coming out of university thinking that they should be starting in middle to upper management is a joke.

Ensui · July 9th, 2009, 03:41 PM

Worse than 25 year olds are the 35 year olds going back to school with high expectations when they get out. There are a surplus of overqualified unemployed individuals already. Of course there are some who will excel with their new degrees but I'm afraid most will not. If the economy does not recover, going back to school (mba, law) will really be swimming against the current. Can you imagine massive student loan defaults?

lattes · July 9th, 2009, 03:58 PM

In Canada you can't go BK on your student loans

Ensui · July 9th, 2009, 04:09 PM

I'm sure in America we have protections as well. However the problem isn't so much personal bankruptcy, it's the fact that the loan could be relatively worthless. In that sense, it becomes an evaporation of capital that are on someone's books. Slippery slopes

LokeyRS · July 9th, 2009, 04:32 PM

I believe its the same in the US lattes. I know people who've filed BK, lost their homes, theirs cars, their cash, just about everything..... but the wake up a month later in the hotel and guess what......THEY"VE STILL GOT A STUDENT LOAN BILL AT THE FRONT DESK!!!!

Most of the time if not payed, the interest is just compounded and compounded at some pretty horrendous rates. I know one relative stopped paying here Federal Aid Loans, and the loans defaulted to a standard IRS Failure to pay rate. At the time, the rate was 14% annualized a year! (Her's before defualt was 4%. 4 friggin %. She stopped paying because she wanted a vacation....idiot if I do say so myself.)

Just five years later, her $50k debt was well nearly $100k. They never will see the money either..she thinks it's all just a big joke....some people.

GeeWillickers · July 9th, 2009, 05:17 PM

Originally Posted by lattes

In Canada you can't go BK on your student loans

That's thanks to the frickin' hippies and bunch of idiots who stiffed the government between the '70s and late '80s.

On the upside you can definitely negotiate the $$$$ out of it when you go to pay it off. Basically the government loans the money to the bank at 1% or less. Last year I paid mine off with a straight 3% rate. I invited them to take me to court otherwise.

Kordoyn · July 9th, 2009, 05:37 PM

And there are still massive gaps in the trades. I wouldn't be surprised if the average journeyman made more than the average MBA graduate at this point. And the scale will keep tipping in favor of the trades people in the next decade or two.
I seriously wish I had never bothered with my degree and went straight into trades, I would have been 5 years ahead of where I am now.
Oh well...

ChuckD · July 9th, 2009, 08:52 PM

Student Loans & Bankruptcy

Student loans are not usually discharged in bankruptcy. It is difficult, but not impossible, to do so if you can show that payment of the debt “will impose an undue hardship on you and your dependents.”

Courts use different tests to evaluate whether a particular borrower has shown an undue hardship. A common test is the Brunner test which requires a showing that 1) the debtor cannot maintain, based on current income and expenses, a “minimal” standard of living for the debtor and the debtor’s dependents if forced to repay the student loans; 2) additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and 3) the debtor has made good faith efforts to repay the loans. (Brunner v. New York State Higher Educ. Servs. Corp., 831 F. 2d 395 (2d Cir. 1987). Not all courts use this test. Some courts will be more flexible.
If you can successfully prove undue hardship, your student loan will be completely canceled. Filing for bankruptcy also automatically protects you from collection actions on all of your debts, at least until the bankruptcy case is resolved or until the creditor gets permission from the court to start collecting again.

Assuming you can discharge your student loan debt by proving hardship, bankruptcy may be a good option for you. It is a good idea to first consult with a lawyer or other professional to understand other pros and cons associated with bankruptcy. For example, a bankruptcy can remain part of your credit history for ten years. There are costs associated with filing for bankruptcy as well as a number of procedural hurdles. There are also limits on how often you can file for bankruptcy.

More info here.
Student Loan Borrower Assistance Bankruptcy

IllinoisWeber · July 9th, 2009, 10:20 PM

I think the universities need to have some responsibility. If getting excepted into a college program on a student loan was anywhere near the difficulty of gainful employment with said degree, half the nimrods would not default on the loan in the first place. Another government ponzi scheme.

You bought it, they own you. Just laugh the next time your Alumni Association calls for a donation.

Game On, RW

Ensui · September 24th, 2009, 01:45 AM

http://www.bloomberg.com/apps/news?p...d=aI5hGQ6hbCRo

It's not just the white collar jobs either. A friend of mine just got accepted into the Local 3 electrician union. There were over 30,000 applicants. For the next three years they have accepted less than 500. These are the electricians too! They're the first ones on a site, and the last ones to leave.

ItsLance · September 24th, 2009, 10:31 AM

Funny you guys mention it, but I'm currently getting my MBA, but I'm not doing it expecting to be a CEO. I'm more interested in making money for myself as an investor and an entrepreneur. I have a science/engineering background and am tired of the glass ceiling.

Ensui · September 24th, 2009, 01:02 PM

Originally Posted by ItsLance

Funny you guys mention it, but I'm currently getting my MBA, but I'm not doing it expecting to be a CEO. I'm more interested in making money for myself as an investor and an entrepreneur. I have a science/engineering background and am tired of the glass ceiling.

Go for the glory and be a money manager/venture capitalist.

ItsLance · September 24th, 2009, 02:30 PM

That would be great! It wouldn't really be work either, since I spend so much time voluntarily investing and learning.

Come to think of it, we should set up an MSB hedge fund. We certainly have enough capital and knowledge here to make it a success.

Ensui · September 24th, 2009, 05:23 PM

Originally Posted by ItsLance

That would be great! It wouldn't really be work either, since I spend so much time voluntarily investing and learning.

Come to think of it, we should set up an MSB hedge fund. We certainly have enough capital and knowledge here to make it a success.

Lol no way, if we're including the whole forum I think it'll be harder than herding cats.

sblok · September 24th, 2009, 09:42 PM

LOL, MSB hedge fund\

penny stocks and bio junk, mmmm

n1tro · September 29th, 2009, 12:32 AM

I'll tell you the MBA secret....it's....NOTHING. :P You will be just as good as an entrepreneur if have an MBA or not. The MBA just makes you think you can do everything. When the degree is a dime a dozen, it's better to have one than not.