LONDON (

TheStreet

) --

Citigroup's

(C) - Get Report

chief economist believes the sovereign debt crisis in Europe could lead to a string of defaults and bank failures, according to a report.

In an interview with

The Telegraph

, Willem Buiter said financial markets are caught in a "game of chicken" between the European Central Bank and individual governments of European countries.

The most financially sound nations, like Germany and France, have balked at bailing out troubled neighbors, like Ireland. Meanwhile, worries continue to grow about Spain and other nations whose balance sheets appear questionable.

"The market is not going to wait until March for the EU authorities to get their act together," Buiter told the newspaper. "We could have several sovereign states and banks going under. They are being far too casual."

He indicated that the funds made available so far through a ¿440 billion rescue fund are inadequate, saying they represent "a very small pot of money for a very big crisis."

-- Written by Lauren Tara LaCapra in New York

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