Premiums on credit default swaps are rising for European countries that have big exposures resulting from the need for bank bailouts.
One advanatge of held by the United States is that regions that have unusually high numbers of foreclosures are buttressed by regions with less dramatic real estate problems. In the EU, with its compartmentalized structure, problems tend to hide behind national borders. This puts Ireland and Spain at particularl risk as they were the twin epicenters of the European housing bubble. The EU is less-able to deal with these issues than the US, one reason for the pronounced euro weakness of recent months.
