The Nobel Prize for economics, Paul Krugman, is said to be “shocked” by the actions of the Greek government. In an interview with CNN on Sunday, Krugman admits he has “overestimated the competence of the Greek government.”
Krugman believes that Tsipras and the Government of Athens advanced to direct confrontation with no plan B. “Surprisingly, they thought they could ask for better terms (the agreement) without any alternative plan. (…) I did not think they could take a position without having an emergency plan, “said
” This is certainly a shock, “summed up.
Paul Krugman, when calling the referendum called on Greeks to vote “No” to the proposal from creditors. Still, the renowned economist believes that the new conditions imposed on Greece “are even worse, but the conditions which proposed them also would not work. ”
As for a possible exit from the Eurozone, did not exclude the possibility: “Or can get some sort of massive debt reduction, which has not yet secured, or will have to leave.”
However, Krugman believes that the repercussions will be as severe as those registered during the bankruptcy of investment bank Lehman Brothers which precipitated the global financial crisis. The Nobel Prize for economics considered that a possible “Grexit” would have “enormous implications for the future of the European project.”
“If Greece out and start to recover, is likely to happen, that would be a way to encourage other political movements challenging the euro, “he said.
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