One Wall Street firm has an idea that’s raising eyebrows: forgive some student debt for first-time homebuyers.
It’s too early to say exactly how the stimulus measure BlackRock BLK suggested would work, but it would take Congressional action because the federal government administers the majority of student debt.
The move could be a creative way to ease student debt, which has quickly become a $1.2 trillion Achilles heel in the American economy.
Millennials aren’t buying many homes. Mounting student debt may be part of the problem. “Fiscal policy initiatives targeted at young workers with high levels of student indebtedness might, perhaps surprisingly to some, have an outsize impact in supporting the housing recovery and financial markets,” Rick Rieder, co-head of Americas Fixed Income at BlackRock, wrote in a recent commentary.