“Countries have defaulted many, many times in the past,” Rogoff said in an interview on BBC Radio 4 today. “Exiting the euro is clearly not as routine, but it’s certainly not unthinkable.”
“I think the odds they will be gone from the euro in a few years are very high,” he said. “Really part of the reason they’re staying in is they’re being bribed not to default.”
If European leaders’ plan is “just to build a firewall, it’s not going to work. They need a fundamental restructuring of the euro” with a fiscal union and common regulatory rules and it needs to happen soon, he said.
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