U.S. housing prices and rising delinquencies on mortgage payments could lead to aggregate losses related to the residential mortgage market and related securities of about $565 billion, including the expected deterioration of prime loans. Adding other categories of loans originated and securities issued in the United States related to commercial real estate, the consumer credit market, and corporations increases aggregate potential losses to about $945 billion.recent viewpoint feature on Housing Wire explored in the wake of Bear Stearns' historic collapse. "It is now clear that the current turmoil is more than simply a liquidity event, reflecting deep-seated balance sheet fragilities, which means its effects are likely to be broader, deeper, and more protracted," the study's authors wrote.
IMF Pegs U.S. Credit Losses at Nearly $1 Trillion
In a wide-ranging report looking the global credit crisis triggered by trouble in the mortgage market here in the United States, the International Monetary Fund warned Tuesday that the crisis has yet to play out. The IMF's latest Global Financial Stability Report for April pegged losses at an astronomical total, as well: