European Bond Yield Summary 5/10/12

10-Year Yields:
Greece 24.27%
Portugal 11.47%
Hungary 8.19%
Spain 6.08%
Italy 5.62%
Belgium 3.23%
France 2.88%

Netherlands 2.10%
Finland 1.92%
U.K. 1.91%
U.S. 1.85%
Germany 1.51%

The troubled nations in the top grouping see yields creeping up while the yields in the bottom safer-haven grouping drift lower.  Money is fleeing the troubled nations and seeking perceived safety in the bottom grouping; Germany is now at a historic 1.51%. Greece yields are blowing out now above 24%--a 400 basis point blowout over the last month. Greece is falling apart since a coalition government cannot be formed. The Eurozone threw a life line to Greece yesterday to hold them over until June, when new elections are projected to occur, which also helped buoy the U.S. equity markets.  However, with 1,000 businesses closing per week in Greece and high unemployment, the economy is spiraling downward out of control. The hot summer heat and soccer championships in June may sadly usher in serious rioting and mayhem across Europe.

Portugal jumped almost 20 bips and Hungary jumped 10 bips since yesterday. Spain is lingering above 6% and the government stepped in to bailout one of their largest banks. The Spanish banks are of grave concern. The Spain property bubble makes the U.S. housing bubble pale in comparison. The regional savings banks, caja's, are asked to set aside funds to handle bad debt. Spain is taking a serious turn for the worse and this contagion would easily spread across Europe. The euro is now under the critical 1.30 level, down eight straight days. U.S. futures are flatish although tech is down on the negative CSCO news.