Has the market discounted all the bad news on Wall Street write-downs?

With this morning's market rising in spite of news of Credit Suisse (NYSE: CS)'s $2.8 billion write-down and the potential for $203 billion worth of additional Wall Street write-downs on various "structured investments", I began to wonder whether investors have already discounted all the bad news and the market will start to rise.

The Credit Suisse write-downs drew praise from analysts for their reflection of the strength of its risk management but they also shocked investors who sliced 9% of its stock. Credit Suisse took "fair-value" reductions -- an estimated price when no market price is readily available -- of its "structured credit trading positions" of about $2.85 billion. I am not sure why analysts praised Credit Suisse because it's not all that different from any firm struggling with how to value illiquid securities.

Meanwhile, UBS estimated that the world's largest banks could ultimately take $123 billion to $203 billion of additional write-downs on subprime-related securities, structured investment vehicles (SIVs), leveraged loans and commercial mortgage lending. The higher estimate assumes that the troubled bond insurance companies fail -- and this assumption will soon be tested.