????This once extraordinary action made on behalf of the ECB may need to be made permanent if private investors continue to shy away from European sovereigns. Pulling out prematurely could cause the system to collapse, forcing another round of bailouts. By that time, European leaders hope to have the newly enlarged European bailout fund authorized and ready for use with around 500 to 750 billion euros to backstop any possible future failed auctions and to keep interest rates at reasonable levels.
????But before then, it is largely believed that Portugal and possibly Ireland will try and get some sort of haircut on their debt, throwing the system back into turmoil. Portugal is the one country traders are watching intently. Trading in Portuguese bonds and CDS has dried up on anticipation of some sort of credit event rumbling the nation in the near future. European bond traders tell Fortune they are forgoing sovereign debt and focusing on the nation's corporate bonds where they know they won't be regulated to second-class status. If this continues, Portugal's government will need some serious help when it goes out to raise cash, leading to what many believe would be another nasty bailout.
