German economist Otmar Issing told Reuters that Greece will ultimately need some form of debt restructuring, but not now.
"The question is about contagion effects. If one country fails, the next might next join and markets might test one country after the other”, Issing said. “So on Greece, finally some restructuring will be needed but it should happen in somewhat more calm times", he added.
The former European Central Bank executive also stated that the Franco-German agreement at Deauville killed any effective reform of the stability pact.
He added that the only hope for the eurozone now was for financial markets to put pressure on governments “which means that in the future private investors buying bonds from different countries must be aware that they take a risk, a sovereign debt risk and this will create spreads", according to Reuters.
source: CAPITAL
