I have heard a lot of estimates when it comes to the total cost of the subprime mortgage fiasco. If this is the amount they are willing to admit, how much more will be lost “on the books” that they won’t ever reveal, else people would know how truly bad things are?

Wall Street banks, brokerages and hedge funds may report $460 billion in credit losses from the collapse of the subprime mortgage market, or almost four times the amount already disclosed, according to Goldman Sachs Group Inc. Profits will continue to wane, other analysts said.

“There is light at the end of the tunnel, but it is still rather dim,” Goldman analysts including New York-based Andrew Tilton said in a note to investors today. They estimated that residential mortgage losses will account for half the total, and commercial mortgages as much as 20 percent.

While I support the government backed “bailout” of Bear Stearns, I think things are working a bit backwards. The investors of Bear Stearns, the ones who just a year ago held stock that was valued at almost $170 per share, have lost fortunes with the collapse of the company. After the “bailout”, new investors grabbed as many shares as they could, somewhere above the $2 range. Since JPMorgan increased their bid, those investors (who bought so low) will be making a 500% (roughly), while the long term investors who placed their faith in the company and held their ground to support it, still lose their asses.

I know “that’s business”. That doesn’t mean it doesn’t suck for them. How much longer will it be until we see stories of people jumping out windows because they lost everything they owned? Think it won’t happen again? Keep dreaming.

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