French Election

With the economic house of cards in Europe collapsing, one of the major themes is the political turnover in Greece, Italy, and now the election in France on April 22nd will take front and center stage.  The politicians have been the target of European citizens who are causalities of severe downturn hitting the E.U.  The election outcome in France is meaningful and if Sorkozy is defeated it may be a major inflection point.  German and French leaders joined as major allies trying to hold the entire region together.  As France and Germany have the strongest credit ratings in the European Union, other investing outsiders may view the election as an example of how an individual country in the E.U. is unwilling to help other members.  The recent increase in bond yields in Spain is showing how bond investors are starting to view sovereign risk as an important theme in the E.U.