SPAIN YIELDS NOW AND THEN: SPAIN-GERMAN 10-year yields hit a new high of 2.14%. Heres the chart from our May 31 warning when the spread was at 1.53%. We alerted last Monday that the breakout of the 3-year channel meant a rally towards 1.80% and 2.00% (200 bps). Today the spread hit 2.14%, which now implies 2.50% later this month. It is a question of time when EURUSD breaks back below $1.1870 and calls up our $1.1660 target. Spanish strikes was the fundamental catalyst for today's euro deterioration and yield spike.