We have another Eurozone bail out. The Euro Summit has released a 15 page statement (pdf) overviewing the agreement. The plan was ratified by all 17 Member States of the euro area.

First, there is a haircut on Greek debt, which while pretending to be voluntary, the volunteer or else threat behind it would allow a complete Greek default, where bond holders would get nothing and banks would probably be ruined.

We invite Greece, private investors and all parties concerned to develop a voluntary bond exchange with a nominal discount of 50% on notional Greek debt held by private investors. The Euro zone Member States would contribute to the PSI package up to 30 bn euro.

The plan is to reduce Greek debt to 120% of GDP by 2020 and is about €100 billion reduction with yet another €100 billion in additional aid.

The European Summit also announced a massive increase in their bail out fund, the EFSF, to €1 trillion, ($1.4 trillion dollars) or over four-five times what the EFSF is now. Europe plans on using the fund to prop up credit for countries deeply in debt and believe this or not, they are going to set up SPVs, yes those infamous corporate shell legal structures from which undetermined equity can be held.

Maximising the funding arrangements of the EFSF with a combination of resources from private and public financial institutions and investors, which can be arranged through Special Purpose Vehicles. This will enlarge the amount of resources available to extend loans, for bank recapitalization and for buying bonds in the primary and secondary markets.

Additionally European banks must now increase capital reserves, due to haircuts, and raise an additional €106.5 billion by June 30, 2012 to bring capital reserves up to 9.0% of holdings.

Believe this or not, Europe is supposedly going begging to China for funds and loans.

Does that make sense? Offshore outsourcing their economies to China and now going begging to them for money? China has $3.2 trillion in Foreign reserves and now there is talk of selling off European public assets to China:

Some Europeans are looking to Chinese companies, still financially strong after the 2008 global crisis battered Western business, as potential buyers of public assets such as power companies that might be sold to raise money.

But Chinese buyers that picked up European companies and other assets earlier at fire-sale prices have run into trouble managing them. They have shifted to pricier but more reliable blue-chip acquisitions such as China National BlueStar Corp.'s purchase this year of Norway's Elkem, a maker of silicon and carbon parts, for a hefty $2 billion.

Skeptics are popping up like mushrooms on this latest announcement, noting details are not worked out. We've had so many European announcements on debt, the banks and Greece, with more a less a kick the can down the road approach already. Additionally there is so much focus on confidence as some magic if you believe, they will come approach. So, it should be no surprise the globe has become the show me state.

There is a side bonus. The Financial Times is reporting, this might trigger a host of sovereign CDSes and thus be the death knell in the credit default swaps market. Yippie!

Politicians are seeking to take their revenge: not just with the recent introduction of bans on some trading of credit default swaps but also in their attempts to ensure that any haircut on Greek government bonds does not trigger a credit event.

Combined, these two events could spell the end of the credit default swaps market, say bankers.