by Calculated Risk on 1/05/2011 03:07:00 PM

Just an update ...

• From the NY Times: Portugal's Borrowing Costs Rise as E.U. Sells Bonds for Irish Rescue

The European Union began issuing bonds on Wednesday to finance its rescue fund for Ireland, even as Portugal was required to pay more to sell short-term debt.

... the Portuguese Treasury and Government Debt Agency sold €500 million of six-month bills ... The bills carried an average yield of 3.69 percent, far above the 2.05 percent Portugal paid for a similar issue in September.

• In addition to Portugal, yields are rising again in Ireland and Greece. The Ireland 10-year bond yield is over 9%, and the Greece 10-year bond yield is at a record 12.62%. Both Greece and Ireland are using the "bailout" funds, and the high yields suggest investors expect an eventual default.

• Update: From Bloomberg: Spanish Bank Stocks Drop on Funding Cost, Led by BBVA

It seems another blowup is inevitable.