Appalachia

I've been through some very poor areas in eastern Kentucky that look like a third-world country. There were some trailers and shacks that did not look fit for human habitation but were being lived in. But not all of eastern Kentucky is like that.

'Hollows' are much more general than what he's describing. A hollow is just the valley between two hills or mountains. Most of them are not deeply impoverished areas. And I haven't heard of squatters except in a historical context, but I suppose that could be happening to some degree these days. Most coal operations now are mountain top removal mines so they blow up the mountain and fill in the hollow and then try to sell the flat land to developers or even local governments.

Here are a couple of articles from last year with some pictures from Owsley County (the poorest county in the U.S. according to the Huffingtonpost article).
http://www.dailymail.co.uk/news/article-2134196/Pictured-The-modern-day-poverty-Kentucky-people-live-running-water-electricity.html

http://www.huffingtonpost.com/2012/04/25/owsley-county-prom_n_1450163.html