Had it not been for the taxpayer bailout of those banks, none of them would have survived. The Fed has helped them juice their numbers (and will probably do it again) with quantitative easing but without the widespread gambling that fed the housing market, their numbers could never last. They pay out obscene amounts of money internally for high stakes gambling but those returns won't come back until the next generation of politicians forget about this current mess. The banks will still make money - they almost always do - but the question now is whether they will be able to still rake in the big money and not crash themselves. Moody's is suggesting that the sector has trouble ahead. Will Greece or Europe in general bring them down? Bloomberg:
UBS AG, Credit Suisse Group AG (CSGN) and Morgan Stanley’s credit ratings may be cut by as many as three levels by Moody’s Investors Service, which is reviewing 17 banks and securities firms with global capital markets operations. Goldman Sachs Group Inc. (GS), Deutsche Bank AG (DBK), JPMorgan Chase & Co. (JPM) and Citigroup Inc. (C) are among companies that may be downgraded by two levels, Moody’s said in a statement, adding that the “guidance is indicative only.” Moody’s today cut some European insurers’ ratings based on risks stemming from the region’s sovereign debt crisis. The potential downgrades, which may raise borrowing costs and force banks to increase collateral, put the ratings company at odds with bond investors, who are sticking with bets that new capital rules and trading limits will make the financial firms safer in the long run. Funding costs have climbed for banks worldwide as Greece’s debt woes roil markets.