I’ve purposely avoided discussing ForeclosureGate, even though I discuss real estate quite a bit, for the sole reason that I’ll write a 5000 word rant on the illusion (delusion?) that a largely deregulated financial market and under-the-table derivatives market would not implode upon itself. Much like a parent leaving a hedonistic teenager at home alone for the weekend with keys to the liquor cabinet, it was only a matter of time until mendacious acts of the untrustworthy kind was upon us.

Instead, I’ll leave it to Barry Ritholtz to bring you up to date on the de-evolution of property rights in America and how the complete breakdown of multiple quality control & quality analysis that the legal process was supposed to provide has failed miserably.

[click to site for video]

The scary thing, aside from very obvious fact that people are fraudulently being evicted from their homes, is that the entire wholesale real estate market (foreclosures, REOs-bank owned properties, short sales, etc.) is temporarily shut down. So state and local governments, who are already under severe budget shortfalls, will be under further pressure since these homes will continue to remain empty or have home owners not paying their mortgages, much less their property taxes.