Eurozone finance ministers shouldn't have rushed to arrange a $125 billion bailout fund for Spain to recapitalize its banks, says international investor Jim Rogers.

The loan will help prop up Spain's banking sector, but letting banks or any other organizations go bankrupt isn't always a bad thing, Rogers says.

Bankruptcy allows an economy to clean up dying businesses and emerge healthier and stronger.

Editor's Note: I Wish I Were Wrong — Economist Laments Being Right. See Interview.

History, meanwhile, is full of examples of economies that went bankrupt but never went under.

"New York City went bankrupt, the world didn’t come to an end. Mississippi went bankrupt once, the world hasn’t come to an end. Detroit’s bankrupt, the world hasn’t ended," says Rogers, according to CNBC.

Should bondholders in Spanish and Greek banks fear losing money?

Maybe, but it happens.

"What happens is you reorganize and you start over. It’s been happening for a few thousand years. There’s nothing new about it," Rogers says.

The U.S. refused to bail out Lehman Brothers in 2008 and let it go bankrupt.

"We would still be suffering," Rogers says if the U.S. had rescued Lehman Brothers. "They would still be bailing out everyone in sight."

Rogers has described the Spanish bailout as "absurd," and other investors appear to be viewing the rescue package with suspicion, questioning whether it will work on the grounds that even though it may bolster the banking sector, Spain's overall debt burdens remain.

Unemployment remains sky high at over 24 percent while the economy remains mired in recession.

Moody's Investors Service downgraded Spain's government bond rating to Baa3 from A3, while the country's borrowing costs soared to their highest in eurozone history at around 7 percent, a level widely seen as unsustainable on fears that the country itself may need bailing out.

"The underlying problem of deteriorating confidence in sovereign debt in Europe is continuing to intensify," says Lee Hardman, currency economist at Bank of Tokyo-Mitsubishi, according to Reuters.

Editor's Note: I Wish I Were Wrong — Economist Laments Being Right. See Interview.