"If you don't have a functioning financial system the world economy won't be revived. All the major economies have their responsibility to assist at a pace which is required to clean up the balance sheet of the banking system and to ensure that credit flows are resumed"
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The line carries the calm urgency of a technocrat trying to make panic sound like homework. Manmohan Singh isn’t offering inspiration; he’s issuing a systems warning: no credit, no recovery. By framing the crisis as a “functioning financial system” problem, he shifts attention away from stock-market theatrics and toward the plumbing of modern capitalism - balance sheets, interbank trust, the basic ability to lend and borrow without fear the counterparty is rotten.
The intent is bluntly strategic. “The world economy won’t be revived” makes the banking sector not one troubled industry among others, but the central relay station. “Clean up the balance sheet” is diplomatic code for politically painful interventions: recapitalizations, bad-asset write-downs, guarantees, and in some cases nationalization-by-stealth. It also launders moral hazard into necessity. Banks may have caused the mess, but letting them fail becomes framed as an unacceptable collective risk.
The subtext of “All the major economies have their responsibility” is a coordinated-pressure campaign. Singh is speaking from India’s vantage point as a large, globally exposed economy that didn’t design the crisis but would pay for it through trade contraction, capital flight, and stalled development. He’s telling the U.S. and Europe: fix your financial institutions quickly, not just for yourselves. “At a pace which is required” is a rebuke to incrementalism - a warning that delay is its own policy choice, one that exports recession to everyone else.
Contextually, it’s crisis-era multilateralism: globalized finance created globalized consequences, so the cleanup has to be internationally synchronized, even if the politics remain stubbornly national.
The intent is bluntly strategic. “The world economy won’t be revived” makes the banking sector not one troubled industry among others, but the central relay station. “Clean up the balance sheet” is diplomatic code for politically painful interventions: recapitalizations, bad-asset write-downs, guarantees, and in some cases nationalization-by-stealth. It also launders moral hazard into necessity. Banks may have caused the mess, but letting them fail becomes framed as an unacceptable collective risk.
The subtext of “All the major economies have their responsibility” is a coordinated-pressure campaign. Singh is speaking from India’s vantage point as a large, globally exposed economy that didn’t design the crisis but would pay for it through trade contraction, capital flight, and stalled development. He’s telling the U.S. and Europe: fix your financial institutions quickly, not just for yourselves. “At a pace which is required” is a rebuke to incrementalism - a warning that delay is its own policy choice, one that exports recession to everyone else.
Contextually, it’s crisis-era multilateralism: globalized finance created globalized consequences, so the cleanup has to be internationally synchronized, even if the politics remain stubbornly national.
Quote Details
| Topic | Money |
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