So as a short hand the world has been talking about club med as the PIIGS (Portugal, Italy, Ireland, Greece and Spain). What many fail to realize is that not all these pigs are equal [to continue the word play]. Italy is a systemic problem (Greece was a pimple). Whereas the world can "write-off" Greece with impunity (it's only about Euro 350 billion -- lots of money but inconsequential on a global capital market scale). Italy is a different game entirely. The world's third largest bond market issuance, lots of banks "own" Italian debt. The French banks hold about half a trillion (yeah that's real money).
The issue has always been if Europe cannot deal with Greece (the EFSF is a demonstration of this half measure) it stand little chance to deal with Italy (Belgium is next on the list). There's no real point in going into details, because the big picture part of the equation doesn't add up at all! European leaders tried to cobble together a leveraged SPV when the capital was less than the anticipated losses for Greece alone, the rule of half measures. if you want to scare the market you need howitzer not a BB gun. Europe's leaders failure (numerous) has been to mislead their citizen, continually underplaying the stakes and the risks, because the failure points directly back to these very same leaders!
Hoping that things would change, like saying that Greece will grow by 5% in 2013 when the government compress expenditure, salaries are cut and taxes are raised -- just not going to happen, and yet these are the type of assumptions that are used by Europe's leader as a demonstration of how the EFSF will "work out"
Lest reader thing I forget the U.S. November 23rd is the day on which America will discover that they are as dysfunctional as Europe. BTW for those interested, if you think the Democrats and Republicans hate each other, its nothing compare to the right wing and left wing parties in Greece and Italy... blood feuds!