Decreasing corporate profits mean decreasing tax revenues. These tax revenues are ultimately what pays those sovereign bond coupons. The Eurocrisis is rapidly approaching the day of reckoning. Today, it was put off some by Draghi’s comments, and tomorrow it might be delayed by increased central bank manipulation.
These countries are running out of money at an increasingly rapid rate. Whatever forecasts are floating out there for PIIGS debt needs for the rest of the year are wildly optimistic. Eventually, the ECG will have to print money to buy these PIIGS bonds, and this will signal the endgame.