by Calculated Risk on 7/18/2011 01:19:00 PM

The next emergency EU summit is scheduled for this coming Thursday.

Wolfgang Münchau is very concerned, from the Financial Times: Plan D stands for default and death of euro

The biggest single danger in the eurozone crisis now is that events are moving too fast ... It was a huge mistake to postpone an emergency EU summit until Thursday this week.
excerpt with permission

This is a key meeting. If there is no agreement on how to proceed, the markets could really panic.

Also many people were disappointed with the stress tests released Friday. From the WSJ: Euro Stress Tests Tell Only Half the Story

Here is what the official stress tests results didn't tell you: 27 European banks would need to raise a combined €82 billion ($155 billion) in new capital ... That is well above the €2.5 billion shortfall, spread across eight banks, announced Friday.

The €82 billion doesn't tell the full story.

Naturally bond yields are rising. A key European analyst (I can't name) put out a note last night that ended with "Run like hell."

The Greek 2 year yield is up to a record 36%.

The Portuguese 2 year yield is up to a record 20.4%.

The Irish 2 year yield is up to a record 23.2%.

And of bigger concern ... the Italian 2 year yield is up to a record 4.6%. And the Spanish 2 year yield is up to a record 4.6%.

Still much lower than Greece, Portugal and Ireland, but rising fast.

Check out the Italian and Spanish 10 year yields for more hockey sticks! Here are the links for bond yields for several countries (source: Bloomberg):

Greece	2 Year	5 Year	10 Year
Portugal	2 Year	5 Year	10 Year
Ireland	2 Year	5 Year	10 Year
Spain	2 Year	5 Year	10 Year
Italy	2 Year	5 Year	10 Year
Belgium	2 Year	5 Year	10 Year
France	2 Year	5 Year	10 Year
Germany	2 Year	5 Year	10 Year