It looks like renowned hedge fund manager John Paulson is betting against European debt. It would be interesting to know if he is using credit default swaps against countries or specific companies. Paulson made most of his money through buying credit default swaps on subprime CDO's so this type of situation is right up his alley. Europe needs to stay extremely vigilant at managing Spain and other troubled nations as many of the peripheral European economies are in a recession which could get much worse if confidence continues to decline. Meanwhile the sell off in European stocks is increasingly creating attractive opportunities particularly in the telecom sector where you can buy companies like Telefonica (NYSE:TEF) and France Telecom (FTE) with 10% plus earnings yields. These companies should be able to grow revenue at a greater rate than inflation and the bottom line could grow considerably faster making for quite exciting return possibilities.