If all Americans read financial magazines, we never would have had a real estate bubble

It's just a throwaway line in a comment by Curmudgeon on my Merced real estate saga, but it nonetheless got my hackles up:

This continued because the realtors and builders (and to be fair, the media - yes, Justin - and the economists and a lot of others) said that people were still working and making money, and real estate always goes up, so this is simply a natural outcome of an expanding economy.

Now I certainly wasn't telling anybody that "real estate always goes up." Here's something I wrote for Fortune in 2005:

To bring the argument back to houses: In many U.S. markets today, the monthly cost of buying a house is significantly higher than the monthly rent on an equivalent house. So by the "imputed rent" test, it makes no sense to buy. People buy anyway because they assume that house prices will keep rising, meaning they can sell out later for a profit. That of course requires that another buyer will come along who also assumes that prices will keep rising, which will require yet another such optimistic buyer down the road, and so on, and so on. This happens to be the definition of a Ponzi scheme.

I'm not claiming to be any kind of forecasting guru (that 2005 article concluded: "[T]his real estate market craziness cannot continue. But to make a bet about when it's going to end--now that would be really crazy.") And there were lots of similar warnings to be found in the business/financial media in the years leading up to the current bust. The problem--and I of course think it is the greatest problem facing our nation today--is that not enough Americans read the business/financial media.

Economist Bob Shiller, whose warnings about an impending real estate bust were quoted pretty danged widely in the financial press, writes in his new book The Subprime Solution (available as a Kindle download right now; supposed to be in bookstores next week, although it may be there already) that lower-income homebuyers generally weren't aware of the risks inherent in subprime mortgages, because nobody had any economic incentive to alert them to those risks.

Financial advice magazine did indeed report on these risks. So, while the higher-income subscribers to those publications got the story and stuck overwhelmingly to conventional fixed-rate mortgages, many lower-income people were left with personal tragedies.

One of Shiller's proposed solutions for this is government-subsidized financial advice for the nation's nonmillionaires. How 'bout government-subsidized subscriptions to Fortune and Money then?