May 26, 2022 By Patrick Nelson
When the first global pandemic in more than a century began spreading around the world in early 2020, the U.S. government mounted a shock and awe response worth trillions of dollars.
The inflationary and market-warping effects of this spending binge will reverberate for years, as will the debt payments -- U.S. government debt just surpassed $30 trillion for the first time in our history. That is a growth-sucking 130% of annual GDP.
For a preview of the effects of a huge sum of government money flooding any market, look at higher education. My firm, Nelson Partners, manages 23 investor-owned apartment complexes near 15 campuses in 13 states.
The COVID crisis produced a windfall of billions of dollars for colleges and universities, even as they shut down most of their operations and taught courses online -- and kept charging full-boat tuition. My company lost $12 million and managed to get a $1.2 million loan.
In the 15 years since I formed Nelson Partners, tuition at public four-year schools is
up 180%; at private universities, the cost is up 124%. In fact, college
costs have risen more than four times as fast as the inflation rate
for fifty years!............To Read More...