Why so low? According to Housing Wire, WaMu’s $231.1 billion loan portfolio included $52.9 billion in  ARMs and $62.5 billion in home-equity loans and lines of credit.  J.P. Morgan said it would write down WaMu’s loan portfolio by roughly $31 billion to account for losses.

Still, other questions remain: Some of the loans J.P. Morgan Chase now holds (via WaMu and Bear Stearns) will be eligible for sale to the U.S. government when a bailout package is finalized. So just how much will J.P. Morgan Chase make on the backs of taxpayers given that they snatched up these tenuous loans at next-to-nothing prices? The WSJ notes: “The deal will vault J.P. Morgan into first place in nationwide deposits and greatly expand its franchise.” In other words, J.P. Morgan Chase has billions to gain from a federal bailout while homewoners and consumers still have much to lose.

For the past 30 years, net capital rules required broker dealers to maintain a debt-to-net capital ratio of 12-to-1. But in 2004, at the height of subprime lending and mortgage fraud, the SEC allowed theses firms to operate at a 30 and even 40 to 1 ratio, Big Picture notes. In other words, it was blind-eye deregulation–skirting rules in place for more than three decades–and cut-and-run greed that caused these three firms to implode in on themselves.

The two remaining investment banks, Goldman Sachs and Morgan Stanley, are also suffering hits from the flying debris caused by this week’s stock tumbles. Morgan Stanley shares sank 42 percent Wednesday, while Goldman Sachs’ plummeted 53 percent.

Economist and NYU professor Nouriel Roubini has repeatedly warned in papers and interviews that the financial and banking crisis will last several years, with credit losses nearing $2 trillion. Since late 2006, a total of 283 lenders have imploded, according to the Mortgage Lender Implode-o-Meter. The bloggers at Implode-o-Meter have been tracking the housing crisis and the fraud inherent in it that has contributed to the toppling of mortgage giants. Currently, 14 lenders are on Implode-o-Meter’s ailing list, including majors like Sallie Mae, Chevy Chase, and Residential Capital, a mortgage subsidiary of GMAC Financial.

The subprime fallout is leaving small banks unstable, too. According to LoanWorkout.org, a consumer-watchdog site, the Federal Deposit Insurance Corp (FDIC), the organization responsible for insuring up to $100,000 in individual bank accounts, might also look to the Treasury Department as its coffers begin to run dry as a result of bank failures and a shored-up cash flow. (Nearly ten percent of its reserves were swallowed up in the IndyMac bust.) Roubini estimates that hundreds of small banks will go bust in the next year, as the average bank has nearly 67 percent of its assets in real estate. The FDIC says it’s currently watching 117 in-danger-of-collapsing banks, which hold approximately $78 billion in assets.

So what do the bank collapses and an already $400 billion in government bailouts mean for you? In taxpayer payouts, we’re already more than 300 percent beyond the Savings and Loan scandal that cost taxpayers $124 billion in the 1980s. And according to Roubini, the current and looming fallouts mean we’re on the precipice of the most severe U.S. recession in decades. “This U.S. consumer is shopped out, saving less, debt burdened and being hammered by falling home prices, falling equity prices, falling jobs and incomes, rising inflation and rising oil and energy prices,” he writes on his blog, the Global EconoMeter.

Consumers shouldn’t expect a quick turnaround, he says. Instead, he adds this ominous forecast for America’s future: “This is the beginning of the decline of the American Empire.” The losses are spreading to industrial and corporate loans, to corporate bonds and CDs, Roubini says. Those collapses will lead to a systemic failure of the market, and America as a super power.

The losses also mean more tax dollars going to corporate welfare, that every person is a “shareholder” in seriously unstable companies Fannie Mae and Freddie Mac, and that the already swelling federal deficit just ballooned further. And it means that those responsible for the crisis, voracious executives and directors whose unstoppable appetite for profits caused the biggest financial crisis since the Great Depression, get off easy why the American public pays for their greed affair.

In honor of this Depression-era milestone, we look back at a MnIndy July article spelling out just how much the execs at Fannie Mae and Freddie Mac stood to gain on the backs of consumers, and what your hard-earned tax dollars will buy you today:

$13.4 million: Amount in salary and compensation paid to Fannie Mae CEO Donald Mudd in 2007, a 7 percent increase in pay from the year prior despite the fact that the company’s shares lost a third of their value in 2007

$18.9 million: The total amount, not including salary, compensation, and stock options, Freddie Mac CEO Richard Syron is eligible to receive through extension bonuses, “equity grants,” and “performance awards” if he stays through 2009

$12.77 million: The total amount in lobbying expenses paid by Freddie Mac in 2007

$3.3 million: The total amount in lobbying expenses Freddie Mac has paid so far in 2008

$12.3 million: The total amount in lobbying expenses paid by Fannie Mae in 2006

$1.8 million: The total amount in lobbying expenses Fannie Mae has paid so far in 2008

$29 billion: The amount of credit the Federal Reserve awarded to JPMorgan to buy ailing Bear Stearns in March of this year

$124.6 billion: Total paid by U.S. government in the early 1990s for the Savings and Loan scandal caused by fraud and unregulated and imprudent lending practices

747: Total number of savings and loan associations that failed as a result of the scandal

$165 million: Average amount needed to bail out each institution then

$35 billion: Average amount needed to bail out each ailing institution today

More on Fannie Mae and Freddie Mac here.

More on Nouriel Roubini here.

Well, according to the economic experts in some of the stories linked below, it looks like the death knell could linger for a few more years. Hey, at least this week’s roundup of consumer-news items makes for good reading on this Good Friday. Now we bow our heads in prayer. Seriously.

• Tastes like chicken: A crippled economy. A weak labor market. Higher energy and food costs. It looks like many Americans will be forgoing that organic ham this Sunday in favor of a cheap, watery Costco chicken. Retailers like to call being forced to scrimp in an economic downturn “trading down,” which is a friendly euphemism for “this sucks.”
• It’s a seller’s market! No, it’s a buyer’s market! It’s a great time to buy! Actually, it’s none of the above, according to a story earlier this week at Fortune.com. Because home prices still have a way to go before they reach their average 25 percent decline, thanks to nearly a decade-long unregulated housing market. And now 20 million people — a quarter of U.S. homes — will be stuck in negative equity.
• So what exactly caused this current mess and why did the Fed take the boldest action since the Great Depression when it facilitated the bailout of Bear Stearns? The New York Times created a short primer this week that explains how a deregulated housing market took out an entire global financial system.
• And finally, attorney Mark Ireland over at consumerrightswatch.com has posted a Friday Funny that explores some of the problems consumers face in service-based economy. Lemons, anyone?

We will post an an interview on Monday at Minnesota Monitor with Mark Ireland about the mortgage meltdown, what to expect in Minnesota in the near future, current foreclosure-relief legislation and more.