Most of our mortgage inventory, for example, because we have reasonable external pricing is level 2. Level 3, although it does include some derivatives, and it includes derivatives where at least one input is unobservable, it also included a lot of assets that people understand quite well, so leverage loans are in level 3. Real estate which is valued using discount cash flow and has been for 100 years, is in level 3, and corporate principal investments are in level 3. If you took those three categories of assets for us, it would make up the majority of our level 3 assets.

Meredith Whitney (CIBC): The level of conviction you have with your marks, can you talk about that in terms of historical context and regression analysis you''ve done in different environments where you have taken similar marks and where that has ended up being relative to market value?

David Viniar: We mark all of our assets to market, our traders mark our assets. We have a controllers'' department that has around 1,000 people that is responsible for verifying the prices of all of the marks of all of the assets at Goldman Sachs, and we do that not just in market turmoil. We do it every day, and we can''t manage our risk if we don''t know the value of our assets, and so our whole risk management process is predicated on being able to value the assets that you have, so we do it; we do it carefully. It is reviewed by very senior people. It is then reviewed by our auditors, and we have ongoing discussion with the SEC as our main regulators about the methodology for marking and for verifying our prices.

One of the things that we do in addition to marking and using all of the evidence that we have, most of which is actual market trades, is we back test. So we look at assets that we sell compared to where they were marked.

Meredith Whitney (CIBC): My last question is on distressed opportunities within the mortgage space and outside the mortgage space with larger debt markets, obviously issues are trading at significant discounts to where they''re cash flowing. Can you give a sense of the timing of when a lot of funds that have been raised to invest in these distressed assets will start to move so we will see stabilization of these markets?

David Viniar: Clearly there are distressed assets out there. There are also assets that are not distressed assets that are trading at distressed prices, so there are a lot of people looking on some of these assets like the leverage loans, one of the things that''s going on is there are a lot of distressed buyers out there, but the holders don''t believe they are distressed assets because they''re very good assets.

That''s one of the reasons there is a supply/demand imbalance because people have not yet come to an agreement on what price the sellers will sell at, where the buyers will actually buy. I think it is getting closer, and we''re getting to the point where at least in my view the buyers are becoming more realistic about price and therefore I think you will see some of the that log jam be broken, but I think it is going to happen over the next couple months.

Mike Mayo (Deutsche Bank): You took $2.4 billion of writedowns gross of fees on those leveraged loans, and should we use a denominator of the $42 billion period end, which implies a 6% markdown?

David Viniar: The writedowns were on the commitments. It was also on funded loans which we had about $10 billion at the end of the quarter but also some that we had sold already, so you can''t completely do that math but I will tell you the bulk of the writedowns were on unfunded commitments.

The math will give you a mathematical answer to what the numerator over the denominator tells you. It won''t tell you much else. We mark every single position individually. They all have different characteristics. Some will be marked at 98, some at 96 and some 94 and some at 90 and at 88 and 86, and every one is completely different.

Mike Mayo (Deutsche Bank): Are we in the ballpark if we say the average writedown per dollar of leveraged loan is 5% to 6%?

David Viniar: The mathematical calculation is correct. That is a true statement if you said the averages, you just take the numerator over the dominator but it will not inform very much if you think we wrote everything down by 5%. There are some that we did and some we wrote down by less and some we wrote down by more.

Mike Mayo (Deutsche Bank): How did non-U.S. do this quarter versus the second quarter?

David Viniar: Our international businesses were about 53% of our revenues during the quarter. Just a note of caution that that number could easily bounce around within a few percent here or there. It includes lots of transactions that are cross border transactions where you have a non-U.S. buyer and a U.S. seller or vice versa, a non-U.S. company issuing equities in the U.S.; we have global trading books.

It certainly does indicate the where the business is going which is that the non-U.S. businesses are growing faster than the businesses within the U.S., so I think it does inform you by its direction more than by its precision.

Mike Mayo (Deutsche Bank): In your opening comments you said something like especially international, was strong but the proportion is kind of similar?

David Viniar: Because the percentage of revenues outside the U.S. continues to grow. For example, the $ 1.7 billion of losses in leveraged loans were substantially in the United States.

Mike Mayo (Deutsche Bank): Any one region you want to highlight? China is kind of a long-term story, but that market has done well. Is there any way to capitalize more aggressively there than you''re already doing?

David Viniar: I think we are very focused on China. We have a terrific team there. We have a terrific franchise in China.

Mike Mayo (Deutsche Bank): In mortgages you have been under represented and that helped you and also being short on mortgages obviously helped you. How do you think about the mortgage businesses? Is now the right time to expand in that business more aggressively? Also can you size what kind of gain you might have made by shorting mortgages?

David Viniar: Mortgages is an important business for Goldman Sachs. It always has been, but in the context of all of our other businesses, it is certainly smaller than some of our competitors. We think that there are going to be opportunities in the mortgage business. There is certainly going to be opportunities to buy distressed assets. Timing is going to be very important, and it is something we are certainly looking at right now. We''ll continue to look at it and consider it over time. Sorry, but we don''t disclose individual business units and so I can''t tell you the actual profits of the shorts.

Mike Mayo (Deutsche Bank): Was this one desk or is this a whole unit or a whole asset class up to the CEO?

David Viniar: It was across the capital structure of mortgages.