In some ways, it's gratifying - and in other ways, quite depressing - to go to a large foreclosure auction. My photographer Mike Malanga and I attended one held by Zetabid one recent weekend at the Miami Beach Convention Center.

Home after home, condo after condo, townhome after townhome...more than a hundred different pieces of property came up for auction. For some units, the starting bid was perhaps $10,000 or $15,000. Going to one of these auctions is gratifying because you realize there really are people with money (or financing) out there interested in buying these parcels at a discount. Some of these people are professional investors, who will tell you that it finally makes sense to buy properties at reasonable levels, rent them out, and make money. The math, they say, "makes sense." You also see a fair number of young couples and singles, hoping to buy their first home.

But it's also a somewhat depressing sight visiting a foreclosure auction because you inevitably think about all the families that lost possession of their homes in the aftermath of the housing market collapse, and all the speculators (large and small) who may have taken a financial bath during the run-up to the bust.

As Zetabid chairman Bob Bellack told us, the properties that come up for auction at his events are on their "last stop" in the foreclosure process. The original holder of the mortgage fell irretrievably behind, whatever attempts the bank made at loan modification have failed, and there are few others interested buyers for the structure. An auction, through crowd psychology and a talented auctioneer, could theoretically get a better price. It seemed to me though, that people were keeping a pretty firm hand on their wallets, especially when they were bidding in the tens and hundreds of thousands for assets that likely have few other buyers.

Perhaps more distressing, it's clear when you come to one of these auctions that some lenders "just don't get it." A number of times, a property had a decent number of bidders, but the final bid was still lower than the (unstated) reserve price set by the lender. Clearly, banks are sitting on some properties, knowing in their heart-of-hearts that the market has to come back...these properties just can't be that cheap...the market (meaning the auction crowd) has to be wrong. So banks play their dangerous game - sitting on a piece of property, hoping for a turnaround in the real-estate market. At the present time, the longer the bank waits, the cheaper the property becomes. And the more money ultimately lost by the bank.