As in many walks of life things are often not as they are spun by our political class but the diametric opposite. Thus it is with the EU bail outs of the PIGS spun as EU concern for the people of these benighted countries. Well not exactly. Who would be the biggest losers if a PIG defaulted or put it another way who lent the PIGS all this dosh in the first place to secure the juicy interest rates on offer?
The answer is French and German banks. A PIG default would generate a Franco Prussian banking crisis of Anglo Saxon proportions. This would require a G Brown size government injection for these banks financed by Pierre and Fritz. Sarky and Merkel would have to eat huge amounts of Anglo Saxon humble pie with no garlic or sauerkraut to take away the nasty taste.
Hence what is spun as altruism is naked self interest. The sovereign bailout ban in the EU Lisbon treaty was simply ignored. Bankers, as in the UK, invokes the force majeure argument.
However if all else fails in Spain expect the forced conversion of bonds with some value to worthless bank equity as we endured in the UK except it won't be Sarky and Merkel who ends up with the worthless shares but those who lent to Spain ie the French and German banks. Are they worried well Yes but they know, with government help, they can hide these shares on their balance sheets at par value and their shareholders will be none the wiser. The only thing they will notice is the inevitable call for fresh capital to meet Frau Merkel's new hairshirt for bankers regulations. So its bad luck if you hold Franco Prussian bank equity and bad luck if you hold Spanish bonds! As Eddie George used to say Dodgy Bank, dreadful Bank etc.