Economist Nouriel Roubini said Europe must increase the money it has raised to battle its debt crisis and deploy a 2 trillion euro ($2.7 trillion) “bazooka” before it is too late.
In a Sunday Bloomberg interview, Roubini, a professor at New York University’s Stern School of Business, said, “I’m very concerned of things getting out of control. You need a huge bazooka of at least 2 trillion euros, but you can’t wait three months. You have to do it in the next few weeks.”
Europe could be running out of time thanks to the situation in Greece, where austerity measures have missed targets set by the International Monetary Fund, European Central Bank and European Commission, and because markets are growing increasingly worried that Spain and Italy will follow other nations down the bailout road.
A complicating factor is that Monday was the date originally set for European finance ministers to approve the second tranche of funding for Greece’s rescue; however, that is now in doubt thanks to those missed targets, despite 6.6 billion euros in new austerity measures passed by Athens on Sunday. Austerity provides no room for growth, and without growth it is doubtful that Greece will be able to repay its loans.