The IMF estimates that write-downs from the credit crisis will ultimately total $1 trillion.  So does Goldman Sachs.

If so, we are half way there.

The writedowns and credit losses at more than 100 of the world's biggest banks and securities firms rose after UBS AG reported second-quarter earnings today, which included $6 billion of charges on subprime-related assets.

The International Monetary Fund in an April report estimated banks' losses at $510 billion, about half its forecast of $1 trillion for all companies. Predictions have crept up since then, with New York University economist Nouriel Roubini predicting losses to reach $2 trillion.

I think Roubini's estimate is too high, similar to those who predicted oil would go to $250 or that the Canadian dollar would go to $2 against the greenback.

If $1 trillion is the correct amount, then we are in the deepest point of the valley.  Markets will fall lower and the economy will slide further into recession, but investors should start contemplating the bottom of the market, which I believe will occur some time next year.