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First, do no harm

Commentary: Austerity can backfire if your economy falls out from under you

Long-term rates rose in the last 10 days, at their worst the 10-year Treasury note to 1.83 percent from 1.65 percent, and mortgages to 3.5 percent despite the Fed's new $40 billion-per-month QE3. Many fear a general round of rate increases for the usual reasons: Europe back from the brink, an overdone bond-buying panic, a positive turn in the U.S. economy, and the always-popular endgame of central bank money printing. It's often hard to isolate the cause of market movements, but not this one. Nor is it hard to spot the reversal today, 10s back to 1.77 percent, stock market hitting a li'l ol' air pocket. Europe has been central to this spike, hopes there high for the two-day Brussels summit ending today. Markers: the euro itself rising to $1.31, and yields on Spanish bonds down almost by half. It is hardly an accident that rates here topped yesterday as the summit turned out to be yet another exercise in talking about more talking. Market pressure is down for the moment in the eurozo...