Bond Rout

Sometimes I never leave
But sometimes I would
Sometimes I stay too long
Sometimes I would
--The Motels

The worldwide bond rout continues. Over the past couple of months, 10 yr Treasury yields are up about 50%.

But that's nothing compared to sovereign debt elsewhere--particularly in Europe. Rates on Spanish paper have about doubled. Yields on German bunds are up about 20 fold.

Of course, these increases come from such small levels that the absolute effects are minor. But the relative moves, particularly for leveraged players, are certainly being felt.

Whether this is the beginning of THE bond rout that blows up the financial market casino remains to be seen. But it is how such a rout is likely to begin.

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