Are Europe’s PIGS the Next Target of the Bond Vigilantes?

Two weeks back I noted and predicted that the seeming complacency in the bond markets of the crisis stricken EU countries would be temporary

Paradoxically bonds of the crisis stricken PIGS have shown a stark contrast: declining yields [GGGB10YR:IND Greece green, GBTPGR10:IND Italy red-orange, GSPT10YR:IND Portugal red and GSPG10YR:IND Spain orange.]

I do not subscribe to the idea that such divergence has been a function of the German and French economy having pushed the EU out of a statistical recession last quarter. Instead I think that such deviation has partly been due to the yield chasing by German, UK and French investors on debt of PIGS. But this would seem as a temporary episode.

Has the bond vigilantes landed in the shores of the PIGS?

Yields of Spanish 10 year bonds

Yields of Italian 10-year bonds

Yields of Greek 10 year bonds

Yields Portuguese 10 year bonds

And higher bond yields has coincided with falling stocks

Stock markets of the same nations, particularly Greece (ASE: IND), Portugal (PSI20: IND), Italy (FTSEMIB: IND) and Spain (IBEX:IND) seem to have markedly downshifted.

Has the magic of ECB's Mario Draghi of "do whatever it takes" started to wear off? Will the bond vigilantes continue truncate the mirage of "recovering" markets equals "economic recovery"?

The bottom line is that the damages from the rampaging bond vigilantes has been mounting and spreading on a global scale. 

Caveat emptor