Yes, it is a fad, and yes, it will go away. Both men's and women's fashion fluctuate in terms of formality, and often they are not really in synch. Right now it seems that women's fashions are on the heavily informal side, while men's fashion is actually moving in the more formal direction. You can't really say this is right or wrong. It is just one aspect of social changes.
I'm no expert, but I think that women these days are trying to express their feminity. In the 80's women's fashion was based heavily on immitating men's fashion, shoulder pads and muted colors were in. Then in the 90's I think it was more about individualism and rebellion for both men and women, with the grunge image being popular, but flannel shirts are not very feminine either.
The past decade or so I think women have been getting more comfortable with showing feminity and curves. Maybe they are trying to reclaim that feminine appeal that has been slowly decreasing in women's fashion for many years. That, combined with a rejection of societal norms regarding modesty has resulted in many women, typically younger women, wearing clothing that not long ago would have been considered inappropriate in most social settings.
Of course that's all just a guess, I'm not an expert by any means.