Nobel-Prize winning economist Paul Krugman says Greece’s hard times are far from over — and a Grexit is not out of the question.
Eurozone leaders are set to offer new bailout terms for the deeply-indebted Greeks this week. And the country’s banks will also reopen on Monday.
Krugman, however, is not convinced the situation in Greece is any less concerning.
“My guess is either in the end they will get this sort of enormous debt relief…or they will have to exit,” Krugman told CNN’s Fareed Zakari Sunday. “My money is on exit one way or another.”
And Krugman agreed with some other economists who have said a Grexit shouldn’t be underestimated. Even if forgiving the country’s debt does not lead to “Lehman-like” bank failures, it would affect the stability of the Eurozone.
“If Greece exits and then starts to recover, which it probably would, that would be, in a way, encouragement for other political movements to challenge the euro,” Krugman said. “This is not trivial.”
