Joe Wiesenthal says something that can’t be said enough:

The fact of the matter is that there’s no example in Europe, yet, where the bond market has rewarded austerity.

Actually, that may be a bit too strong — Latvia, which never had much debt to begin with, is back in the graces of the bond market, although still deeply depressed.

But consider Ireland, which has been proclaimed an austerity success story not once but twice — in 2010 and again last fall. Strange to say, markets have remained firmly unconvinced. Here, for example, is the CDS spread from Bloomberg (which moves closely with the bond spread):

Ireland is still nowhere near regaining market access.

So where is the supposed payoff from austerity?