US GDP is about 14,000 billion... So total losses are 1.7% of ONE YEAR of economic output... And probably about 50% of those losses are to foreign investors... So that's < 1% of one year spread over 3 yaers... So that's 1/3 of 1% for 3 years. Big Freaking Deal. People fueling the HYSTERIA about subprime... Are basically saying that a few homeless people... Are gonna bring down the US economy.
"The amount of debt that's likely to go bad is virtually certain to be in the high hundreds of billions of dollars, and it wouldn't surprise me if it ends up crossing a trillion," said Baker.