Today they argue that market prices overstate losses, because they largely reflect the temporary illiquidity of markets, not the likely extent of bad debts.

【翻译】现在，他们认为市场价格夸大了损失，因为市价主要反映了市场暂时的流动性不足，而非坏账可能达到的程度。

1. not 是否定reflect 的，the likely extent of bad debts 是reflect 的宾语。所以，not the likely extent of bad debts 等于：and they don’t reflect the likely extent of bad debts（市价没有反映出坏账可能达到的程度。）

其实，这个问题不难理解，这属于承前省略现象。我再举个简单的例子：

I like this one, not that one. 等于：

I like this one, and don’t like that one. 等于：

I I like this one, and I don’t like that one.

2. loss是个多义词，主要有这几个意思：“损失，减少； 丢失，遗失；亏损； 失败”。表示“损失”意思时，要用复数losses。