As Ireland announced a 4 year austerity plan (wait a minute, didn’t they do that 2 years ago? Yes, yes they did) the situation in Spain and Portugal continues to deteriorate. The Irish austerity measures virtually guarantee a continuation in the Irish depression and the EMU is ready to impose further depression on the rest of the periphery. The Portuguese are already protesting planned cuts and markets are preparing in case the crisis in Europe deteriorates further. Portuguese 10 year yields surged this morning to 7% while Spanish 10 year yields surged to fresh highs of 5.05%. It looks like the bond vigilantes are on the move and they’ve circled their next targets.