I believe we have reached the point of diminishing returns on news coming out of Europe. In the past couple of years it has been costly to panic out of the market based on European news. Like Pavlov's dogs market participants are beginning to realize this. Spanish yields are at record highs today and the market has barely blinked.
Whether one agrees with the actions of EU authorities or not, it has become increasingly clear that when push comes to shove that they will not let the system collapse. As a result we are not likely to see the same extreme responses based on scary headlines out of Europe. I am not belittling the problems or saying that the market cannot go down. I am just saying that it will take something different.