If comedians jokingly refer to Florida as “America’s penis“, then the above graphic illustrating the percentage of total homes that are in foreclosure would suggest that the U.S. real estate market, and Florida in particular, has a raging sexually transmitted disease.
As Gonzalo Lira so cleverly put it: Mortgage Backed Securities are America’s Herpes—the gift that keeps on oozing. One can only hope and pray — or cheer and rant if you’re a bear versus bull on the space — the severity of the infection doesn’t spread to other states.
But, when you consider that 28% of securitized loans did not meet underwriting standards and the Too Big To Fail banks are turning into real estate investment trusts, who are ill equipped to become landlords, the situation looks like it will take more than a few rounds of penicillin to cure.
Image Source & Credit
Cristina Rivero and Mary Kate Cannistra
The Washington Post