Spain's bailout dilemma: not if, but when and how

Markets went briefly euphoric on Tuesday (16 October) when two German lawmakers suggested Berlin is warming to the idea of a Spanish bailout. But the wait-and-see game in Madrid is likely to take a few weeks longer.

Bloomberg quoted two Christian Democrats in Berlin - Michael Meister and Norbert Barthle - suggesting a "precautionary loan" or a "full bailout" for Spain are possible, but only with "conditions."

Back in June, Spanish officials spoke about the European Central Bank's...