As Bloomberg observes, the yield on longer-dated German debt is about to surpass that of US debt for the first time since June 2009, despite the fact that US yields have actually been drifting higher lately.
It’s reasonable to presume that this is some kind of statement regarding German’s creditworthiness because, despite its export-heavy economy and strong government balance sheet, it could technically default and run out of cash, which is not the case with the US, which controls its won currency.
(Yes, de facto the ECB is controlled by Germany, though not technically.)
So with its fellow EU-members increasingly coming under the attack of the bond vigilantes, it only makes sense that Germany begin to come under pressure as well.
Really it’s a scathing indictment of the euro.
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