Could this be the solution to the global financial crisis?

It is August. In a small town on the South Coast of France, holiday season is in full swing, but it is raining. So, there is not too much business happening. Everyone in the town is in debt. 

Luckily, a rich Russian tourist arrives in the foyer of the small local hotel. He asks for a room and puts a Euro100 note on the reception counter, takes the key and goes to inspect the room located upstairs on the third floor. 

The hotel owner takes the banknote in hurry and rushes to his meat supplier to whom he owes E100. The butcher takes the money and races to his supplier to pay his debt. The wholesaler rushes to the farmer to pay E100 for pigs he purchased some time ago. The farmer gives the E100 note to the local grocer from whom he used to take his monthly ration. The grocer goes to the same hotel to pay E100 where he had booked a room for one of his guests a few days ago. 

At that moment, the rich Russian comes down to the reception and informs the hotel owner that the proposed room is unsatisfactory and takes his E100 back and departs. There was no extra profit or income for anyone but everyone no longer has any debt and the small townspeople look optimistically towards their future. 

Could this be the solution to the global financial crisis? 

Yes, it can be the solution. Only the government can play the role of the tourist and infuse the required money into the system as stimulus. But the money must be utilized judiciously so that the government gets back the money after sometime otherwise the problem will keep on multiplying. 

In fact, the same money is always there in the system but it gets stuck up somewhere in the chain. It has to be released to have the free flow once again. It is more of a psychological problem than what is perceived. All what is required is sound planning by the financial wizards to utilize the government money in the best possible manner.

Anurag Dujari

Govind Das Dujari

Mob:92308-92309