QE2 came and it’s off to the races, but what’s going on in Europe?

While it looks like the risk-on trade is in full flow with the interesting concept of all assets going up in tandem – something I find unsustainable – but never mind.

In the middle of the euphoria the crisis in Europe is coming back even if it doesn’t get much attention in the media. Irish 10 year spreads just blew out to a new all time high against bunds, €/CHF looks like it could break down and most likely will if 1.3550 is given (it just was so the recovery in €/CHF seems to be over), the Ibex doesn’t look like it’s in rally mode, quite the opposite, so can the rest of the markets just ignore this and continue as if nothing’s happening in the European corner? Somehow I don’t think so…….