Keeping Italy or Spain from causing a severe global financial crisis is certainly a dicey issue. They way that these countries are apt to be initially dealt with if their sovereign-bond interest rates really go into the stratosphere is to try to help them meet their bond payments (and I can see the Fed doing a lot to try to help facilitate that, even if it needs to be mostly via backdoor measures). However, like Greece, their problems cannot be addressed for the long haul via such means, of course. There will likely even be further can-kicking on a heroic scale once those Italian/Spanish sovereign-bond sustainability issues become very dire, and you could really see heroic Fed backdoor measures to try to help these countries at that juncture (I realize that some might disagree with me here). But obviously, all this gets into the systemic sustainability of the entire global financial system, and someday, things are really going to have to give, of course.
(And yes, being the US President now and in the near future is certainly not for the faint of heart — although if things really start to collapse, this may allow Obama, if he is President when this happens, to really cast aside oppositional forces and really usher in that hope and change he promised us
) Thanks again for sharing! —Best regards, Marc