As Advocates Debate Wisdom of U.S. Rules, For-Profit College Stocks Soar

June 3, 2011

The U.S. Education Department published a final version Thursday of its controversial rules requiring vocational programs to prove that they are preparing graduates for "gainful employment." And while advocates for the colleges, Wall Street analysts, consumer advocates and members of Congress weighed in with widely varying interpretations of the wisdom and the likely impact of the regulations, nothing spoke louder than the reaction of Wall Street investors. Driven by the widespread sense of investor analysts and for-profit critics alike that the rules had been softened considerably from an earlier version, stocks of the 13 publicly traded higher education companies tracked by Bloomberg rose by 12 percent, the sharpest upturn since 2005, The Los Angeles Times reported. For a guide to the new rules, see this related article.

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