FRANKFURT—A German government debt auction drew some of the weakest demand since the introduction of the euro, signaling diminishing investor appetite for even the safest euro-zone assets amid Europe's worsening debt crisis.Germany couldn't find buyers for all of its bonds?
The German government was able to sell only €3.644 billion ($4.92 billion) of the €6 billion in 10-year bunds on auction for an average yield of 1.98%.
My take: I think this is a vote of no confidence in the Euro, not Germany. If you bought German bonds, they would be denominated in Euros. If the Euro takes a dive, then a 2% return on the bond won't be nearly enough to make up for the loss due to the currency. Germany is getting dragged down by the toads in the Eurozone.