I figure the next bubble to burst will be college education. How many parents want to pay for 6 years of partying, or pay to see their kid come out the other side as the next great scholar of gay-minority-womens' studies.
There are signs around here of trouble in the education markets. The acceptance letters went out this past weekend for private high schools in Los Angeles, and surprisingly, I've heard no stories of kids missing out on their first choice. In previous years, only the well-connected or well-heeled got into some of the toniest schools. This year, they're taking everybody.
Why? Well, from talking to fellow grade school parents over the weekend, economic pressures must be hitting these schools hard. We know of several families that are trying to move into areas with acceptable public systems, so they don't have to pay as much for their kids' education, or so they can save their money for high school and college. If that carries over the entire market around here--remember the entertainment industry has been hit hard for years--that means that a lot of spaces are opening up at all these schools, applications are probably down, and acceptance letters are going out in abundance, because schools are worried a lot of families will look at the price tag and the economy and decide it isn't worth it.
My guess is that the exact same thing is going on at the national level with colleges. Only there, they are likely being hit very hard by the tanking of the stock market. All of those education savings accounts are worth about half of what they were a few months ago. Where families might have figured that they had enough to get their kids through a 4-year school, they are now looking at only enough for 2 years. Sorry kid, no private school for you--you're going to State U!
In addition, how many people would choose this moment to take out student loans?
Watch for it in the next few months, as students get their letters and have to make their decisions. Public/cheaper schools are going to be swamped. Private schools will be very worried.
(Cross posted on Saltzafrazz.)