The federal student-loan moratorium lasted almost three and a half years. 

Let that sink in. 

The original 60-day moratorium — which Trump announced in March 2020 — was extended nine times!

And according to a June 2023 press release from the House Budget Committee: “For every month borrowers were allowed to skip payments, $4.3 billion was added to the American taxpayers’ tab.” [Emphasis ours]

Team Biden also introduced a plan for student-loan forgiveness in August 2022, a plan which would have canceled up to $20,000 in federal student loans for an estimated 40 million qualified debtors. 

That is until the Supreme Court foiled Biden. Chief Justice John Roberts pretty much stated the obvious: Only Congress has the power to approve such large-scale cancellation of federal debt.

Thus, with the signing of the debt ceiling bill last summer, the federal student-loan moratorium, at long last, reached its own moratorium on September 1, 2023. 

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Your Rundown for Friday, January 26, 2024...

A High-Priced Popularity Contest

Nevertheless, student-loan forgiveness remains a political hot potato. 

The Heartland Institute’s Justin Haskins explains: “Biden [didn’t] want to take the political blame that comes with restarting student loan payments.” Period.

Especially this election year, with young voters on the line, the Democrats won’t let student-loan cancellation go. 

The latest scheme from the Department of Education is the convoluted, income-based Saving on a Valuable Education (SAVE) plan. 

“In this newest glut of forgiveness, those who enroll in the SAVE plan” — almost 7 million have already done so — and “made payments on their loans [for] at least 10 years” — minus the 42-month moratorium — and “have a balance of less than $12,000 will get forgiveness immediately,” Reason reports, starting in February.

But you know who won’t be saved? American taxpayers. The SAVE plan will cost taxpayers up to $475 billion over the next 10 years, Penn Wharton’s Budget model estimates. [Emphasis ours]

Know who else won’t be saved? If the student-loan moratorium is any indication, borrowers themselves won’t be helped. Not really. 

• “By the end of 2022 beneficiaries of the moratorium accumulated an additional $2,500 in student-loan debt,” says a white paper from economists at the University of Chicago

• These borrowers also accumulated “an additional $2,000 in credit-card, mortgage and car-loan debt, boosting total household indebtedness by 8%.”

All told, there are no real winners here. 

On second thought — if all goes according to plan — Biden might win over seven million voters who’ve had their school loans canceled. 

And, taxpayer, you’ll pay for it! 

Then again, Democrats might win over seven million voters because a second term for Biden might already be DOA. At least that’s Jim Rickards’ compelling premise. 

While Biden’s reelection campaign flounders, Democrats are looking for their next presidential nominee. And Jim explains how Michelle Obama could replace Biden (in a very undemocratic way).

Dismiss Jim at your peril, seeing as he accurately predicted Brexit and Trump’s victory in 2016. So, you’ll want to watch this right away. 

Market Rundown for Friday, Jan. 26, 2024

The S&P 500 is slightly in the green at 4,895. 

Oil is down 0.75% to $76.78 for a barrel of WTI. 

Gold is barely in the green, priced at $2,020.50 per ounce. 

Finally, Bitcoin’s rallied 3.5% to $41,200 at the time of writing. 

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