While Europe has made bad decisions that have created a dangerous mono-culture in Spain, it also gave the impression of prosperity, one we now know was illusory.

FORBES: Europe's Disintegration: It's Not About the PIIGS or the Euro

So even if the size of the EFSF is capped, the impression may well be created that French and German taxpayers have made an uncapped commitment to prop up Italy and Spain - which would infect the perceived strength of the French and German balance sheets.

BBC: Will propping up Italy weaken France?