The social welfare story masquerading as a socially minded clean energy plan, as Chandra refers to the early days of Chinese solar manufacturing development, implies that the Chinese government and the banks want the biggest of the solar companies to make ends meet so they can meet debt payments and refinance as required to stay solvent. However, to think the Chinese government or banks care if these companies generate the 20% to 30% gross margins that European subsidies afforded them isn't likely. "You can install 10 gigawatts in China, but it won't be juicy profits. It won't be Germany," the Auriga analyst said. The primary reason to be constructive on solar stocks in 2012 is that as long as solar has a heartbeat, it's one step closer to economics that aren't dependent on subsidies. The investment story is still a few years out, though, and it's the trading story that continues now, and it won't be a one-way trade in 2012. Stocks rallied sharply to start the year after crashing in 2011 but have been clobbered again, most recently with the headlines out of Germany. "The pain will continue, but the irrationality of a state-oriented capitalism that doesn't have a true market mechanism will begin to fade," Chandra said. As for Trina's debt covenant issue, it is as related to the larger story in China as the LDK chairman's collateral, and it's even more magnified by the fact that Trina is often held up as the "sound" balance sheet manager among risky Chinese solar companies. "Trina is a one-eyed king among the blind," the Auriga analyst said. Maxim's Chew expects Trina to revisit 2011 lows of $5 before a more normalized earnings model emerges. There will be a time to buy solar stocks again, but for now, the big story is the bailout that has been in the making for years and that is now reaching its hell-or-high water mark. Chinese solar is too big to fail, and it's fair to refer to Chinese solar demand as the likely sector savior in the near-term. After all, China created today's profitless Chinese solar manufacturers, and gave them every reason to believe that when the apocalypse came, they would be saved. For bullish investors betting on a 7.5 gigawatt market from China in 2012, though, it's not likely to save them. -- Written by Eric Rosenbaum from New York. >To contact the writer of this article, click here: Eric Rosenbaum. >To follow the writer on Twitter, go to Eric Rosenbaum. Follow TheStreet on Twitter and become a fan on Facebook.