Joe Weisenthal has a smart post comparing Sweden and Finland. Both look solid, and fiscally are in good shape. But where Swedish bond yields have been plummeting, Finnish yields have risen. As he says, this looks like the penalty Finland is paying for being part of the euro and lacking a lender of last resort.

I thought I’d look into this a bit more. Here are Swedish and Finnish 10-year bond yields (ECB monthly data; “November 11″ is actually last Friday):

You can see the big divergence as the euro crisis has exploded. But I think it’s interesting that Finland and Sweden started to diverge back in April. What happened then?

Ah, yes — the ECB started raising rates. And as Rebecca Wilder points out, that’s precisely when euro bond spreads began their upward march, culminating in the current crisis.

By itself, that rate hike — although it was obviously, obviously a big mistake — should not have mattered that much. But maybe it acted as a signal of the ECB’s bloody-mindedness, and that’s what set off the panic.

If that’s what happened, then the ECB’s hard-money madness may have destroyed the euro.