Mene, mene tekel upharsin
I don't think anyone reads these blogs anymore, so I am going to feel free and easy and have a little fun with this entry.
Congress ruled on student loan interest today. A doubling of interest rates on subsidized Stafford loans - the most favorable sort of loans for post-high-school students to take out - took effect on Jul 1, doubling interest rates from 3.4% to 6.8%. Today Congress rolled this change back (usatoday.com) and made some new arrangements:
Under the bill, undergraduates will be able to borrow at 3.9% for this school year, graduate students at 5.4% and parents at 6.4%. Rates now float, however, and reset every year, like an adjustable-rate home mortagage. The float is linked to the 10-year Treasury note yield, but capped: interest rates would not top 8.25% for undergraduates. Graduate students would not pay rates higher than 9.5%, and parents' rates would top out at 10.5%.
To my mind, this says a little bit about where Congress thinks rates are going. College is so expensive these days that most of the young people I know are thinking very carefully about how much debt, if any, they want to acquire. That's very different than the 70's and 80's, when I was thinking about these things: at that time, education in America was regarded as the best investment a person could make in terms of ROI. It's not so anymore; student loan money is a competitive market - just got more competitive - and its consumers are being very cautious with how they allocate their demand.
In other news, BWLD blew out earnings numbers. They added 77 new stores in 2Q13, folks. Their new wing-portion-size that I wrote about a couple weeks ago panned out and they were able to control wing costs at the store level - they now sell wings as they buy them, by weight, rather than number. They've communicated this so well; everybody gets it. They popped, but never mind the P/E; they have so much room to expand, I think they're a screaming (clucking?) buy right here still.
Even Omar Khayyam agrees:
Come, fill the Cup, and in the Fire of Spring
The Winter Garment of Repentance fling:
The Bird of Time has but a little way To fly--
and Lo! the Bird is on the Wing.
I hope all my gentle readers are happy, healthy, making a little money in this crazy market, and filling up the Cup from time to time. (If you do so at BWLD, try their new Game Changer beer - it's great.)