Over the last 3 years we have expressed skepticism about the crisis management skills of European policy makers. Recently we characterized the problem as one of pace and not substance. The basic ideas to save the euro are part of the policy debate, and politicians seem to understand the direction. But the politicians are always a few steps behind, and move slowly.

Mario Draghi, BCE President, is trying to change that, and his most recent efforts are meaningful and make a difference. Ten days ago markets reacted with euphoria to his statements about doing whatever it takes to save the euro. Then in the ECB press conference he clarified what he meant, and many found that disappointing.

We disagree with that disappointment. He has just established a framework to accelerate the transition to a solution for the euro, and it is an important one. In essence, Mr. Draghi said: if a country needs funding (read Italy or Spain need a bailout), then it needs to apply to the EFSF (or ESM), submit to the conditionality therein, and then the ECB balance sheet is available. This is not a small event, and the markets seem to finally take it as such.

Despite the quick statements of support from Angela Merkel and Francois Hollande, there is opposition to the ECB intervening, especially from the Bundesbank and other monetary policy purists (or dogmatic robots, for a catchy illustration). I believe the world is very lucky that Mr. Draghi was chosen, instead of more traditional Bundesbank types like Axel Weber or Jens Weidmann. They are not wrong, but the political and logistical obstacles to the optimal and pure solution require a more pragmatic approach, if saving the euro is the objective.

Mr. Draghi framed the use of the ECB balance sheet within monetary policy objectives, basically saying the ECB would buy enough bonds in the short end of the curve of the country in question to bring yields in line with the rest of the union. This is a serious threat of massive intervention, which if credible would most likely not need to be implemented in such a massive scale.

The intelligent aspect of this is that it satisfies three important constituents: politicians, markets and lawyers. German politics requires a solution to moral hazard, needs to see that help is retribution for reforms and adjustment. This is why the crisis country would need to apply to the EFSF, submit to conditionality and be monitored by the troika (EU, IMF and ECB). But the EFSF or ESM are not big enough to bailout Spain and Italy, which is why the ECB is needed. Lawyers and politicians would have had a hard time trying to endow the ESM with a banking license to leverage their size. Framing the ECB involvement as part of its monetary policy mandate is clever.

The ECB would have never pushed the envelop in this way without a serious political cover. And the statements of support from Merkel and Hollande after the press conference last week are a terribly important signal.

This all looks very promising for the survival of the euro. Now we need to see the details of the framework, further political support, and whether Spain can navigate internal politics to submit to a credible set of conditions. If the euro survives (defined as the core intact – Spain, Italy, France and Germany), much will be owed to the pragmatism and courage of Mr. Draghi.