The rally in banks and financial stocks that the Bear Stearns (NYSE: BSC) debacle touched off last week seems to have lost not only its legs, but portions of its torso as well. Helping to nudge valuations back down toward reality was Goldman Sachs' (NYSE: GS) timely release on Tuesday of the projected total global losses for the current credit crisis: $1,200,000,000,000. That's $1.2 trillion.

Of that gargantuan number, Goldman believes that $460 billion will come from the balance sheets of U.S. leveraged institutions -- banks, brokerages, hedge funds, and the like. With only $120 billion in losses written down so far, this forecast suggests that we have a long road to recovery ahead. Furthermore, Goldman is referring to losses beyond the loan loss provisions these institutions set aside, so we can presume the underlying financial distress to be more severe still.

Tuesday's release was the first to quantify the projected effects from the various classes of debt. Goldman sees residential mortgage losses accounting for about half of the total, with a further 15% to 20% from commercial real estate and the remainder from a combination of credit card debt, automobile loans, commercial loans, and corporate bonds. Since many analysts have predicated their own forecasts for a short-lived recession on the presumption that the residential mortgage crisis will not spread into other debt classes, I consider this detail to be of particular significance for Fools eager to draw their own conclusions.

Collectively, this news provides a brand-new lens with which to examine the balance sheets of many U.S. companies. For example, was it wise for Bank of America (NYSE: BAC) to originate $54 billion in new commercial loans late last year, plus $28 billion in consumer credit, and to follow it up with the bold move to purchase Countrywide Financial (NYSE: CFC)?

As disappointing as this news may be for the U.S. markets, it has even harsher ramifications for some of the foreign markets -- particularly Europe. Much of the balance of the remaining $740 billion will presumably be exported to foreign institutions. The total of U.S. goods and services exported in all of 2007 was $1.62 trillion, suggesting that toxic securitized debt instruments and deleveraging derivatives may be among the leading exports from the U.S. for a while. Somehow, I don't think that's what the creators of the "Made in the USA" slogan had in mind.

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Fool contributor Christopher Barker captains yachts and writes about stocks. You can also find him acting Foolishly within the CAPS community under the username Sinchiruna. He owns no shares in the companies mentioned. Bank of America is an Income Investor recommendation. The Motley Fool has a disclosure policy.