In response to continuing concerns regarding the eurozone crisis, banks on Wall Street decided to publish additional information in regulatory filings regarding their exposure to PIIGS -- or Portugal, Italy, Ireland, Greece, and Spain. Although they weren't necessarily obliged to disclose this information, companies such as JPMorgan
U.S. getting hit hard
Despite the relatively good position these banks are in compared to their European counterparts, stocks are still sliding. All three of the banks mentioned above have seen their shares fall by over 4.5% in the last five days, with Goldman getting crushed the most -- 6.1% in less than a week. The bottom line is that investor sentiment is very negative, and in the wake of the MF Global scandal, people just don't trust that banks aren't taking oversized positions in European debt. Intuition suggests that U.S. banks will most likely carry on publishing more and more information in a reluctant attempt to calm investors and illustrate that their balance sheets are strong and that eurozone debt holdings won't implode -- in short, that they're not MF Global.
Europe still taking the lead
As one would anticipate, banks in Europe are being put under the microscope and have seen the most scrutiny over the past few months. According to Business Insider, some of the banks with the largest exposure to the PIIGS economies include BBVA
This morning, in the wake of the crisis, German Chancellor Angela Merkel urged for a strong, more united political union, as opposed to a weakening or dismantling of the EU. She mentioned creating rules that disciplined fiscal violators (i.e., Greece), tossing them to the European Court of Justice. Merkel even suggested the possibility of eliminating certain countries' membership to the 17-nation union as a measure of last resort (although the action is currently illegal).
All of this sounds good in theory, but will take a long time to implement. In the meantime, uncertainty will continue to take its toll on the market.
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