They have announced a European Financial Stabilisation Mechanism comprising €440bn of loan guarantees, €60bn of funding from the European Commission, plus a contribution of €250bn from the IMF - all this on top of the €110bn loaned to Greece last week.
This dwarfs the American's $700bn TARP. It's very big money. The ECB will be buying bonds from the PIIGS governments directly - illegal under the Lisbon Treaty, but as I mentioned at the time it was ratified the treaty contains a mechanism to modify itself.
The reason for this largess with the euro-taxpayers' money (fortunately the UK has largely declined to take part in this cash giveaway) is twofold: to prop up the governments of the PIIGS (Portugal, Ireland, Italy, Greece and Spain) but also, and perhaps more significantly, to protect the Franco-German banking complex. The French banks especially simply could not afford for the PIIGS to default on their loans. It would cost them more than they have, and worse, the French government could not afford to dig them out of a hole that deep.
Consider the words of Lord Polonious from Shakespeare's Hamlet, 1602,
Neither a borrower nor a lender be;
For loan oft loses both itself and friend,
And borrowing dulls the edge of husbandry.
The first line is the one usually quoted, but the last line is where the true wisdom lies: people (and governments) who start to live on borrowed money are far less prudent in their spending that those using their own cash.