Banks and other financial institutions have written down tens of billions of dollars due to their exposure to investments tied to subprime mortgages.   

Investors worry that more land mines still lurk. In the words of Hamilton James of Blackstone Group this week, "there's another shoe to drop."

Shares of Fannie Mae tumbled 10 percent on Thursday on worries that it may be that shoe. Peter Eavis of Fortune says that the company has changed how it uses a closely watched ratio in a move "that could mask the credit losses that are rising above levels that the company predicted just three months ago."

In a conference call this morning, Fannie Mae executives defended their accounting of credit losses.

"The majority of these loans don't result in any losses,'' Fannie Mae's chief financial officer, Stephen Swad, said on the call, according to Bloomberg News.

He said that some of the $670 million in provisions for credit losses on mortgages that Fannie Mae wrote off in the third quarter would likely be recovered. But the stock is down nearly another 10 percent this morning.

Eavis writes that Fannie Mae, as part of its earnings report last week, disclosed that it had changed the way it calculates the credit loss ratio, resulting in a lower ratio than if it had stuck with the old method.

Whether or not Fannie Mae has an accounting or disclosure issue, there may be other shoes dropping.

A new report from Goldman Sachs estimates that lending may have to be scaled back by as much as $2 trillion as a result of the impact of the implosion in subprime, Reuters reports.

Goldman's chief U.S. economist, Jan Hatzius, said that he estimated credit losses of $400 billion on mortgages, but that leverage would magnify the impact.

"The macroeconomic consequences could be quite dramatic," Hatzius said in the report, according to Reuters. "If leveraged investors see $200 billion of the $400 billion aggregate credit loss, they might need to scale back their lending by $2 trillion."

That's right, our $14 trillion economy may have to take a $2 trillion haircut.

And if the tally of the cost of the subprime debacle is not staggering enough, consider this: It may end up costing more than the wars in Iraq and Afghanistan. Democrats on the House-Senate Joint Economic Committee released a report this week showing that the wars could cost the economy $1.6 trillion through 2009, according to MarketWatch.