Is 'default, then rent' the new American Dream - or sign of a bottom?

Headlines in the mainstream media are often notorious for getting it wrong. But in the case of the recent Wall Street Journal story about how renting is the "new American Dream," the questionable premise could be suggesting that the real estate market is finally approaching a bottom.

First, some historical backstory. On Aug. 13, 1979, BusinessWeek ran the now infamous headline "The Death of Equities," proclaiming that "The masses long ago switched from stocks to investments having higher yields and more protection from inflation. Now the pension funds -- the market's last hope -- have won permission to quit stocks and bonds for real estate, futures, gold, and even diamonds. The death of equities looks like an almost permanent condition -- reversible someday, but not soon."

That article marked, almost exactly, the bottom in the stock market -- and the beginning of a 20-year long bull run that would provide investors with the highest rate of return in U.S. history. In other words, the BusinessWeek piece couldn't have been more wrong, but actually offered some value as a contrarian indicator.