Tuesday, July 26, 2011

Overcoming the European Woes

While everyone is focused on the debt ceiling fight here in America, it's worth noting that debt issues in Europe have already had a deleterious effect on our economy. Companies making up the Standard & Poor's 500 index derived 23 percent of their revenues from Europe as recently as 2008; that number is now down to 21 percent. S&P 500 companies doing business in Europe saw a 10 percent drop in sales over that period.

The good news is, some American businesses have been making up the difference elsewhere. Coca-Cola, for instance, has seen European revenues fall from 17 percent of its overall total in 2008 to 14 percent now. But because its second-quarter revenues were up 15 percent in Eurasia and Africa and 13 percent in Latin America, Coke's revenues would be up 14 percent on the year even if it didn't sell a drop in Europe.

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