The EUR slumped following a brief recovery in the 16-nation currency. Weakening the EUR was not only the warning from S&P concerning the health of the Greek banking system, but also a decision by Ireland to inject billions of euros into the ailing Irish banking system and a reduced growth forecast by the International Monetary Fund (IMF) for Germany.

The plan to aid the struggling Irish banking system, dubbed by the Irish press as Bailout Tuesday, the Irish government would seize two banking institutions, inject funds into struggling banks and take control of troubled assets at other lenders. Irish finance experts have called this the nationalization of the Irish banking system. In total, 8B euros will be used to support Irish banks. This does not include another 2.7B euro private investment that will be needed to bring Irish banks up to their needed capitalization standards.

Adding to Europe's woes was a reduced forecast for German economic growth by the IMF. The forecast was dropped to 1.2% from 1.5%.

Interestingly enough, it appears the U.S. is putting more distance between itself and Europe as the major U.S. banking institutions are recovering and returning to profitability while European financial institutions continue to require fresh government aid. This may be reflected in the recent loss of value in the EUR.