Why are they bailing out Greece?

The Europeans (mostly Germany) have poured E200 billion down the Greek rathole. After all this money, Greece will still give its bondholders a 70% haircut. It would be cheaper for Europe to just let the Greeks go broke. Greece would be unable to borrow, and would have to lay off civil servants, cut benefits, stiff creditors, and issue IOU's to cover its bills. This would be tough on the Greeks, but so what?
One unspoken reason for European generosity, is a fear that a Greek default will break their banks too. Euro bankers have bought staggering amounts of Greek bonds, suckered in by the high interest rates the Greeks promised to pay. If the Greeks default, all those banks will take a big hit. So why not hang the Greeks out to dry and put the Greek bailout money directly into your own banks? Why give the money to the Greeks and hope the Greeks will pay off their bonds? Putting the money right into your bank is less error prone, and less opportunity for sticky fingers to steal the money.
Another unspoken reason to bail out the Greeks, is the hope of making a killing. Plenty of Greek bonds have already been dumped for a song. Bondholders estimate the chances of Greece making payments as low (less than zero) and take advantage of getting a tiny bit of their money back, as opposed to losing it all. So Europe is full of speculators holding Greek bonds that they bought for a tiny fraction of their face value. These speculators are hoping for bailouts that let the Greeks pay off at full face value. If this happens, they get rich. Really rich.
One of the sticking points in the the wheeling and dealing between Greece and the EU has been this very matter. The Greeks want to pay off their bonds for what the bond holder paid for them, rather than full face value. I believe the Greeks won this point, which will save them a LOT of money.
At any rate, it's hard for an American to believe that Euro speculators have enough clout to get EU governments to use citizen's tax money to make them rich.
Is there some other hidden reason for bailing out Greece?