Have you invested in a for-profit college or training program? Get out while you can.
The warning gun was sounded yesterday by DeVry (DV), which posted disappointing results and led the whole group downward. Investor David Einhorn was reportedly shorting Apollo Group (APOL), the market leader which owns the University of Phoenix. The pain has just begun.
The industry’s problems do not stem from its business model – replacing people with computing as much as possible – so much as its financing model. The group is a big user of private student loans – 42% of its students use them against 14% of public and non-profit students. This area has just popped its own version of the sub-prime bubble, and while the totals aren’t as big as they were for housing 5 years ago, they are still large enough to scare new money from the sector.
Read more here – via Seeking Alpha
- October 1st, 2012: Development Economics at Marginal Revolution University
- September 28th, 2012: US Department of Ed. releases 3 year student loan default rates
- Some thoughts on Coursera
- Dropout Nation (PBS Frontline) Aired September 25th, 2012
- September 19th, 2012: Coursera adds 17 more university partners
- Learn some Development Econ. at Marginal Revolution University tinyurl.com/8h4wuoz #MRUDevEcon 1 year ago
- Some thoughts on Coursera bit.ly/QzgBad 1 year ago
- Check out Frontline's Dropout Nation bit.ly/QrNuFP 1 year ago