More circumstancial evidence of the non-bailout

As I concluded with my first post on this blog, the European bailout package seems to have been nothing but a way for Germany to buy time. What they are buying time for is somewhat unclear, although bank defaults would be my best bet. Yesterday, there were reports that there are two clauses under which the "bailout" is in fact nullified :

1. It is deemed to not be compliant with the EU "no-bailout" clause. As ridiculous as this sounds, it is actually true. If the bailout is not allowed under the current no-bailout clause, then there will not be a bailout. Most spectators find it unlikely that any court will decide that this bailout is a bailout however.
2. If any of the countries who are to contribute to the bailout find themselves in trouble securing funding for themselves, they may opt out. The cut-off here is 5%, meaning that any country that needs to pay 5% or more to borrow does not have to participate.

Needless to say, the incentives for the market to promptly bid up government debt, one country at the time, over 5% are staggering. If Spain suddenly finds itself having to pay 5% or more to sell debt, then all eyes turn to the next country in line, since Spain suddenly becomes uninteresting. This may be a reason behind the German push against short-selling eurobonds. They might think that by banning speculation, the markets won't anticipate Spains unability to secure funding and thus creating said unability.

I don't believe it will work, however. It's another trick to buy time. What speculators do is make tomorrow happen, today. Germany might avoid getting tomorrow today. But they sure as heck will get tomorrow tomorrow.

(original article from Ambrose Evans-Pritchard who does not say if his preferred solution is unlimited bond purchases by the ECB.)