If you have been reading my postings for a while, you are familiar with my views on mortgage debt, RMBS, CDO, CDS, CPDO, ABCD and all such derivative and structured finance acronymia. It's all coming to a boil right now, but for the most part it's really, really dry stuff - except for the hardcore types who get heart palpitations just thinking about variations in GNMA experience ratios.
I usually include a graph or two in order to be more, ahem...graphically explicit, but inherently the process of presenting derivative finance is tortuous. Humor helps, but I have been told - in no uncertain terms - that my version tends heavily to sarcasm instead of wit.
So, today being the weekend and all, I will take it easy and let a picture do the blogging - about 1.000 words' worth as the Chinese say.
For your viewing pleasure and thoughtful consideration you will find below a picture of several thousand tightly packed units used in the issuance of all those MBS, CDOs, CDSs, etc.
Perris, California is the "zip code" with most mortgage default notices in the state, according to the LA Times. If you have to commute to L.A. it's one hour to go, two to come back. According to the story, a typical house in one of those "developments" goes for around $330.000 right now, though some hopeful sellers still ask over $370.000. Seems pricey to me from this altitude...
Sadly, this type of sardine-can real estate exploitation is not unique to California or even just the US. If you have visited the south of Spain you know what I mean.