2 Year Bond Yield reach record high in Greece
Investors are feeling more unsecure while buying Greek Bonds than they have felt anytime in past. 2-Year bond yield touched 28.02% in Greece which shows the Greek bond have become riskier. Greece seems to be on verge of collapse and Eurozone seems to be running out of options. Only way out is throwing more money into the system, according to Eurozone and IMF. Other peripheral European economies are also showing no better picture. Only Germany and France are the two countries with lowest bond yields. Poland, Italy, Spain and Ireland are trapped into one of the biggest economic mess of the recent times.
2-Year Yield Greece – 28.15%
If there was no risk of default as ECB president Jean-Claude Trichet insists, there would be no investor preference for German bonds over Greek bonds, Portuguese bonds, or Irish bonds.
Instead there is a significant difference between German and French bonds and the bonds of every other country.
Spain is too big to bail and Italy is much bigger still. All hell is going to break loose when yields in Spain or Italy rapidly rise, and it’s only a matter of time before they do.
Spanish 10-Year bonds are flirting with disaster right now.