College graduates in the United States are taking on an increasing amount of debt according to an article in Business Weekly the debt is reaching new highs and may be the cause of the next economic crash. The Consumer Financial Protection Bureau says that the debt has passed 1 trillion dollars, while the Federal Reserve Bank of New York states: “It grew by $300 billion from the third quarter of 2008 even as other forms of debt shrank by $1.6 trillion.” In some cases, this debt totals ridiculous amounts of over 300 000 dollars. These loans are causing students to mortgage their futures and find quick and easy work immediately after graduation because of the need for income. While researching my post-secondary choices, I realized that the cost of learning in the USA was too high for my family. I save 50 thousand dollars a year by living at home and commuting to school. While it is necessary to have some debt that schools can invest in, the soaring cost of education will force potential students to find alternatives to university.

some statistics about university tuition and debt

 

Article:

http://www.businessweek.com/articles/2012-09-06/student-loans-debt-for-life

A bond issued by the USSR Government in 1982

In the mid 1990s the newly restored Russian Government promised investors that it would repay the 1982 issued Soviet bonds. Now, Russian President Vladimir Putin must find a way to repay the approximately $785 trillion his government still owes. According to Bloomberg the debt would be “equal to almost half of Russian economic output.” Business Week describes a plan the government has to repay the debt, but it is slow and inefficient. The government was paying 50 billion rubles (Russian currency, approximately 3 Canadian cents) back per year; however the debt is 25 trillion rubles. In April, Putin halted the payments, which will resume in 2015, as a stall tactic to buy more time to plan. Putin is still paying the oldest owners of debt, but other citizens disagree with his methods. People have begun to go the European Court of Human Rights to aid them in receiving back their owed investments. While it seems Putin has managed to postpone the payments, I wonder when he will be forced to repay the remaining balances. This would cause a massive financial hit in Russia, most likely effecting the whole worlds economic status.

Media:

A Brief Summary of the Crisis in Russia (short video summarizing cause and effect)

Articles:

http://www.businessweek.com/articles/2012-09-06/soviet-bonds-are-haunting-putin

http://www.bloomberg.com/news/2012-08-27/brezhnev-bonds-haunt-putin-as-investors-hunt-for-785-billion.html

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