Best subprime roundup I've seen this week

from Arnold Kling. I summarize a few of his points:

The tech bubble created trillions in illusory wealth. I am pretty sure that the amount of illusory wealth in the housing market is smaller.

How many firms are so desperately short of cash that they will have to sell securities backed by prime mortgages for far less than their reasonable long-term value? And how is it that there are not enough potential buyers among banks or other firms to provide better liquidity?

I would like to see the subprime securities issue resolve quickly. Mark down those securities, get through the foreclosures as expeditiously as possible, etc. My thinking is that whatever spillover damage that subprime foreclosures are going to have on house prices is something I'd like to confront soon and put behind us.

Spillovers in financial markets are a different story. I would wait a month or two to see if there are any more E-trade sorts of situations. If there are no other shoes to drop (meaning, companies needing to dump securities backed by perfectly reasonable collateral into thin markets), then I would say that we have gotten past the crisis from a financial point of view.

UPDATE: Dennis Berman has a nice juxtaposition of Paulson's SIV idea to the Japanese government's "sivving: of Japanese banks. I remember learning about this MITI-style top-down coordination approach in my college days, but that was before seeing the results of the experiment.