Re: 1988 Mercury 35 HP won't charge
The gray wire is just a sensor wire for the tach. It can be connected to either yellow wire. But try disconnecting it. If it's shorted to ground, it'll kill the charging system.
When stators fail, they will typically dead-short to ground or leave you with no continuity.
Go up to the FAQs. There is a rectifier test procedure up there.
When testing output, everything has to be connected. It'll only work if the electricity has someplace to go, like the battery. Look for battery voltage to rise with RPMs, say from 12.5v at idle to 13.2v at high idle for example. (don't take those figures literally)
Rectifiers usually fail from loose, corrroded, or crossed battery connections. Disconnecting the battery while the motor is running will cause them to fail too.