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Is Portugal the next Greece?

 Portugal's government debt yield has been rising for almost a year from 4% to 7.46% without any significant interruptions and that despite many efforts by the EU to stop a government debt death spiral for many of the smaller EU nations. Greece was the first victim in April 2010 and when the yield on its 10-year bonds soared over 7.5% there was no looking back until the EU decided to bail out Greece. A similar thing happened to Ireland when its debt soared over 7.5% in November of 2010 and now Portugal's debt yield is just below 7.5% at 7.46% (see the chart below - the red horizontal line is 7.5%). There are also reports about an increasing migration of the Portugese population from Portugal into Germany looking for jobs. Since the smaller European nations no longer have their own currency as a mechanism to balance their economy (through devaluation), their economies are increasingly suffering because of the strong Euro. A Portugese government debt problem could once again lead to a significant selloff in European markets and the Euro. 

Portugal 10-year government debt yield



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