Top economists weigh in on Greek credit crisis

The Greek credit crisis is a "very serious problem for the whole world, not just for Greece," says NYU Stern School of Business professor Richard Sylla in The Deal magazine's video conversation with three top economists about the global impact of the crisis. "If Greece gets into trouble, the European banks are in trouble, and that means the U.S. banks could be in trouble, and it does not bode well for the world economy," explains Sylla, who is the chairman of the Museum of American Finance. Says Nobel Prize-winning economist Edmund Phelps: "We wouldn't have a successful business economy if everybody and his brother could just walk away from debts left, right and center, of course, but I think it's something new under the sun when it's being supposed that the Greek government shouldn't default." Phelps, who is the director of Columbia University's Center on Capitalism and Society, adds: "There are probably not very many countries in the world that haven't given a haircut at some time to their creditors." Tufts University's Amar Bhidé insists it would be no worse if Greece defaulted now than if it defaults three years from now. "This is a crisis that is jeopardizing the perception, if not the reality, of the existence of the euro, and it's just not worth it for a tiny little economy of that size," concludes Bhidé. We caught up with Sylla at the current Alexander Hamilton exhibit at the Museum of American Finance; for a previous chat with Sylla, watch "This decade likely to be 'a lot better' than the last." We spoke with Phelps at the recent New York Forum; for other topics we covered with Phelps, watch "China needs 'brand-new financial system'" and "Introducing the 'First National Bank of Innovation.' " Our conversation with Bhidé also took place at the New York Forum; for another clip about his thoughts on Greece, watch "The hidden risk in a Greek default." - Mary Kathleen Flynn