Italy, Spain Can ‘Probably’ Survive Crisis, Krugman Says

Italy and Spain are at an increased risk of exiting the euro as European leaders grapple with how to contain the region’s sovereign debt crisis, Nobel economics laureate Paul Krugman said.

“There are the ones that can probably make it through, even though it will be very unpleasant, as long as there isn’t a panic, and those would be Spain and Italy,” he said today in an interview in Stockholm. “There are the ones that are probably fundamentally insolvent where there’s going to have to be a debt writedown and those would be Greece, Portugal, Ireland.”