
Just a reminder to all:
intermediate hops on a traceroute may show high packet drops *without that router actually dropping any real traffic packets*. Many routers are required by their design to force ICMP traffic up into the CPU, where actual packets may remain down on the much more efficient cross-linecard-path, which means that if the router gets too busy doing "Real work", the ICMP will be the first thing to go.
Evidence of this is usually a large degree of packet loss which starts and ends with one hop in your trace; if *everything past a certain point* seems to be dropping roughly the same percentage of traffic, *that* is probably the outbound link from the router.
Bingo. Traceroute is not a true indicator of packet loss; ping on the other hand would be so long as the endpoint or intermediate endpoints aren't interfering with the flow and don't icmp rate limit. In any case, I would like to point an excellent resource for interpreting traceroute results from NANOG47: http://www.nanog.org/meetings/nanog47/presentations/Sunday/RAS_Traceroute_N4... - Naveen