THE NEW YORK TIMES:

Just three days after a 110 billion euro ($134 billion) bailout of Greece was presented as the latest step to stabilize European markets, the opposite has transpired. Fears have spread through the financial markets that a larger epidemic would infect Spain, Portugal and perhaps other indebted countries outside the euro zone, like Britain and the United States.

In response, analysts are calling for a shock and awe option — some rescue of the largest of the peripheral euro zone economies suffering from stagnation and high levels of debt, not unlike the Troubled Asset Relief Program that was created to restore confidence in the American financial system.

They suggest that the European Central Bank buy back billions of euros of unwanted Greek, Portuguese and Spanish debt and that the I.M.F. offer a large bailout for Spain.

Such a broad stroke would surely cost more than the $700 billion that the United States pledged to back up its failing banks in late 2008. Therein lies the rub: not only is it an enormous sum, but it requires a degree of flexibility, political courage and teamwork that the European Union and the I.M.F. have not yet begun to show.

[...] Representative Mark Steven Kirk, Republican of Illinois, a member of the House Appropriations Committee, which oversees financing to the I.M.F., estimates that a bailout of Spain could cost as much as $600 billion. Citing research from the Congressional Research Service, he says the fund has only $268 billion to lend.