HIGHER EDUCATION BUBBLE UPDATE: Grad Students Driving The Growing Debt Burden. “The typical debt load of borrowers leaving school with a master’s, medical, law or doctoral degree jumped an inflation-adjusted 43% between 2004 and 2012, according to a new report by the New America Foundation, a left-leaning Washington think tank. . . . The increases were sharper for those pursuing advanced degrees in the social sciences and humanities, versus professional degrees such as M.B.A.s or medical degrees that tend to yield greater long-term returns.”

And why?

The foundation’s report also points to a 2006 law that removed a limit on how much graduate students may borrow from the federal government. Before the change, graduate students—excluding medical students—could borrow no more than $138,500 total for their education and were limited in how much they could borrow annually. Now they can borrow up to the “cost of attendance,” a figure that includes tuition, books, transportation and living expenses.

Bottom line: “”Graduate schools have essentially found a way to capture more of someone’s future income and future spending than what would probably occur if we had some sort of underwriting standards and loan limits.” Go figure.