Quote of the day comes from Mike Milken, comparing the magnitude of the subprime
mess to that of the dot-com crash:
Intel stock went down $100 billion in one day. If this is
a $200 billion problem, it’s not all that big, especially considering how
much bigger the markets are now than they were in 2000.
It’s a point worth remembering. The total amount of subprime originations in
2006 was $421 billion. Even if 20% of them get into trouble, that’s only $85
billion or so. Add in a few more from 2005, and some Alt-A and prime mortgages
on top, and you still have a number which is akin to the amount that a single
company can fall in value on the stock market in a single day.