Portugal: Next Eurozone Nation To Fall?

Rewind the clocks to somewhere between 1995-early 2000's. There is a nation that is on an economic tear. As it rips through the European sector, the rest of the world takes notice. This country even garners a sexy, powerful nickname, “The Celtic Tiger.” Now it's 2011. The Celtic Tiger? Slain. In late 2010, Ireland received a bailout from the IMF, and the EU, as the country was in the midst of economic disarray. Ireland was hesitant to take a bailout and who can blame it? Imagine, having to receive handouts after being a model for economic growth in the not-so-distant past. Ireland, and early 2010 bail-out recipient Greece, may not be alone. As the old idiom says, “misery loves company.” Portugal might be coming over. Portugal is suffering from a debt crisis. Much like Ireland, it is confident that it can pull through without the aid of others. Leading the charge of bailout naysayers is Portugal's Prime Minister Jose Socrates. In an

published today, Socrates states, “tax receipts had been higher than anticipated while spending had been lower than forecast. Portugal won't ask for any financial help because it's not necessary.” Teodora Cardoso, a Portuguese central bank board member, differs with Socrates' view. In a Reuters

published this morning, Cardoso states, “Lisbon would do better to seek international financing, breaking ranks with political leaders. It would be easier if we had foreign help because this would mean that the adjustment would not be so abrupt, but if we do it alone, for the markets to believe in it, it has to be brutal.” As the Portuguese Government seeks to prove Cardoso and others wrong, Reuters reports, “Yields on Portuguese 10-year bonds remained above 7 percent on Tuesday, a level widely regarded as unsustainable.” With the Euro at four month lows, and Portugal's potential bailout looming, investors are concerned. If Portugal is to be bailed out it would become the third EuroZone member (i.e. European Union members that use the Euro) to receive a bailout. When and if that happens, the prevailing question will be “How does the Euro recover?” An equally important question to ponder is “Who's next?” Some American Depository Receipts of Portuguese companies include Portugal Telecom

, Electricidade de Portugal

, and Espirito Santo Financial

.