What Trump's second term could mean for student debt

Published On Nov 10, 2024, 9:24 AM

The article discusses the implications of Donald Trump's potential second term on student debt policies in the U.S. It highlights that Trump is likely to reverse many of the Biden administration's initiatives aimed at forgiving student loans. During his first term, Trump took steps to limit debt cancellations for student borrowers and criticized efforts to forgive large amounts of student debt. The article notes that significant debt relief initiatives from Biden are currently stalled due to legal challenges, and Trump's presidency could effectively end these attempts. Potential policies that may be scrapped include the Public Service Loan Forgiveness program and the SAVE repayment plan.

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Stock Forecasts

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Positive

Investors should watch education-focused companies and student loan servicers, as potential changes in policy may affect their operations. A Trump presidency could lead to less favorable conditions for student loan forgiveness initiatives, potentially benefiting companies that are positioned to service ongoing student loan repayments. However, the uncertainty around these policies could negatively impact market sentiment in the education sector overall.

EDUCView EDUC chart on TradingView

Negative

Conversely, companies that depend on education debt relief measures may experience negative effects, as a rollback on Biden's planned initiatives could hinder their business models. This could create investment opportunities to short stocks associated with companies focused on student loan forgiveness programs.

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