Up until late February, I actively followed the for-profit education ("FPE") industry. As I've learned more about investing and refined my criteria, I've concluded that much of the practices in FPE, particularly predatory recruitment and advertising but also discretionary subpar education offerings and the like, are unsustainable and more fully appreciated the regulatory and legal risks the industry faces. The phrase "Don't Fight the Fed" should by now be familiar to most investors, and I think a slight variation - "Don't Fight the Obama Administration" - is a fitting way to describe how investors should view the regulatory challenges the industry faces. Obama spoke at my school 12 months ago about attacking education issues aggressively, and there are other indicators...
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