We investors are always trying to figure out what and when the next bubble and crash will be. If we guess correctly, we will have an edge, because we’ll be prepared to scoop up a lot of assets at a much lower price.

Although I foresaw a big market crash in the next 2/3 years, I think that the fact that Mr. Trump was elected president of the US will change this quite a bit. I believe that markets will actually start to go up, the American economy will recover and the European economies will simply follow the pattern.

But what will cause the next crash? If you know about economy, you know that crashes are inevitable, because the economy works in cycles. And my gut has been telling me that the current markets are too high to be sustainable.

But what exactly will cause the crash? My answer may be a little bit out of the box. I believe that the next big bubble will be higher education. Let us take a look at the facts. So first, let us recall recent history:

In 2000, we had the dot-com crash. In 2008 we had a (periodic) credit bubble. Is the curve above telling you something?

We are simply getting into too much debt. Is it our fault? I don’t think there is anybody to blame, really. I mean, its not because we can smell a crash coming that we shouldn’t borrow money. If you think about it, its actually quite the opposite: John and Mary got themselves a new house, so Alice and Bob gotta get theirs too!

If you look to student debt in the US, you’ll quickly realize what the problem is. Students are getting themselves into increasing debt, because tuition is getting more and more expensive, as the graph below shows.

Student loan debt is actually growing $2,726 every second, and it is about 1.4 trillion dollars as you read this).

The economy machine would have no problem processing this, but the problem is that the market is simply not absorbing graduates anymore. In southern Europe, this problem is so big that you can actually see PhDs as cashiers (please don’t think I am lowering being a cashier, but if you have a PhD and you work as a cashier, then this is a symptom of a broken economy). In the US, this is also a problem. The Journal Sentinel reports an unemployment rate for recent graduates of 8.5%.

Fortunately for Europeans, tuition is really low in most countries, so students are not getting themselves into a lot of dept. However, in the US, the likelihood of defaulting on student loan debt is high, given the unemployment rates for graduates that I mentioned above.

I typically recommend people to have a second thought on getting a MSc or PhD, as I have. This is one of the reasons.