Don't get me wrong - I like Schiller. I thinks he's a smart guy and along with Chip Case, has really added a useful tool to the discussion and study of real estate markets with his Case-Schiller home Price Index (which I frequently site).
BUT
Ok, well at Inamn Schiller gave a talk and made a few points:
His main point is that we may be headed for Great Depression 2.0 (no shock here, coming from Schiller, mr bubble buster himself).
But he made another even more insane point. Any I am going to bash my own industry too while making my point. His suggested that one of the ways we could have averted this crisis is by having more educated general public about financial and market matters.
Four problems with this ivory tower thinking. One most people have NO MONEY. The got into the "housing lottery" only by chance, not becasue they had the wherewithal to invest money. It didn't cost anything to get in the game with 0% down and money was cheap and easy. Why not.
Second - They got sucked into buying houses by a hyped up media, easy money, lottery ticket mentality promoted by brokers, agents, banks, and everybody involved. There was NO ACCOUNTABILTY ANYWHERE. To think some "financial advisor" could have seen this coming is insanity.
3rd - how many so called advisors do you need for each family to have one? There would have to be say 1.2M of them (coincidentally about the same amount of real estate agents in America to serve every family). We see how that works out. Real estate agents have fiduciary responsibility to protect clients, yet most of them are so incompetant that they couldn't protect themselves. Standards are too low. My estimates show that there are MAYBE 100,000 GOOD agents in the whole country (i'll talk this chance to remind consumers - INTERVIEW YOUR AGENT THOROUGHLY). What's going to say that Schiller's army of financial advisors will do any better.
4th - COST - ok so Schiller wants the gov to subsidize like medicare. But I've seen publis servants (court attorneys, cheap doctors, etc) - not exactly highly qualifie. Yes some are, but MOST aren't. Good luck getting GOOD finacial advisors - even most of the highly paid ones are not good.
Schiller - step down off the bursting bubble box, and come into the real world. What good is a financial advisor to poor people. "hey don't spend your entire next paycheck on food". What good is it when the GOOD financial advisors are taking their clients money and taking payment to themselves only to turn the money over to guys like Bernie Madoff with no oversight???
Yeah - that's the solution - financial advisors!?!?!
Now I like to try to be positive - which to me means don't complain without offering another option. So here's my option:
1.tgwert
2. wetewtwet