How quickly do the bond market vigilantes appear?


Investors seem to have lost their taste for Germany’s once much sought-after government bonds. At an auction on Wednesday of the country’s 10-year bonds, one-third went unsold according to the German Finance Agency, which manages the nation’s debts. The federal government had initially intended to sell bond issues worth some €6 billion (around $8 billion), but managed to garner just €3.89 billion.

The Germans are being told they shouldn’t try to auction off so many bonds so quickly, further comment here.  Yet don’t the PIIGS have to roll over $100 billion plus by the end of this calendar year?

And who a week ago — or even two days ago –was predicting this for a German bond auction?

I hear the market whispering in the ear of the Netherlands “get out of the eurozone, before it’s too late!”  At this point all bets are off as to which country will be the first to bail on the arrangement.  It could be virtually anyone but France.


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