As I understand it, a bailout of any EU member nation (say Greece) is illegal under the Euro-establishing Maastricht treaty.
However, Josh Lipton at Minyanville points out a possible loophole should the European nations want to skirt that rule:
"The only real question for members of the Eurozone, says Dr. Ed Yardeni of Yardeni Research, is whether to boot out or bail out the Greeks...
...The economist emphasizes that the Maastricht rules contains a "no bailout" clause to ensure that a member country's budgetary problems couldn’t spill over and damage the credit rating of the Eurozone as a whole.
However, he writes in a recent research note, there's belief that the Eurozone could get around this by invoking Article 122 of the Lisbon Treaty, which allows the European Union to throw a financial life-preserver to a member country suffering tough times."
So the next question for market watchers and EU citizens (or their political elites) to consider is whether or not the larger European nations should structure a bailout for Greece and other fiscally weak member states.
Actually, it's a question that's been tossed around for months as Mark Crosby notes in, "EU bailout no solution to Greece's problems". Take a look at this article to get an easily digestible overview of the problems facing Greece and the eurozone.