CHART OF THE DAY: Austerity Has Failed

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When Europe went into crisis earlier this summer, it had a few choices. One was generous transfers from the rich countries to the poorer ones.

The other choice was austerity — budget cutting in hopes of easing debt burdens.

They tried the latter, but as the CDS market shows, that’s failed.

Irish CDS hit an all-time record spread today, according to MarkIt. Portugal is right behind.

chart of the day, cds ireland, portugal, nov 2010

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