Origin of the financial crisis of 2008 is traced to two fundamental issues: serious flaws in regulation of the financial sector and dominance of US dollar in international finance. It is argued in this book how financial innovations created financial products whose risk assessment was difficult. In the absence of efficient regulations, such risky assets were offloaded on investors. Increase in circulation of tainted assets intensified the crisis which had begun with subprime loans in the US housing sector. Dominance of US dollar created international macroeconomic imbalances in a unipolar international financial system. The book argues for regulating the financial sector and gradually establishing multipolarity in international finance. Monetary and fiscal policy measures, along with the extant prudential regulation of banking sector, helped the Indian policy makers in successfully reducing the fury of the crisis. Nevertheless, India’s stock market and the real sector of the Indian economy had to bear the brunt of the crisis. Inward portfolio capital flows reversed, export demand shrank, and stock prices plummeted. Large chunks of financial wealth were shaved off and recession set in. It is argued that for the Indian economy, the crisis indicated the inevitable flip side of the impact of global integration of Indian economy. For more than a decade prior to the crisis, Indian economy had benefitted in a significant way in terms of increase in capital inflows and transfer of new technology.