Meaning: The quote you provided is from Vince Cable, a British politician who served as the Secretary of State for Business, Innovation and Skills from 2010 to 2015. In this quote, Cable is addressing the significant issue of leverage and global imbalances in the context of the global economy. He points out that the degree of leverage being reversed is staggering, and the underlying global imbalances, particularly between savers and spenders, will require long and painful adjustment.

Cable's statement on "the degree of leverage now being reversed" refers to the process of reducing or unwinding the high levels of borrowing and debt that had accumulated in the global financial system. This deleveraging process became particularly prominent in the aftermath of the 2008 financial crisis, as individuals, businesses, and financial institutions sought to reduce their indebtedness and improve their financial stability. The reversal of leverage involves reducing reliance on borrowed funds and increasing capital and reserves to support economic activities.

Furthermore, Cable's reference to "underlying global imbalances" highlights the disparities in saving and spending patterns among different countries and regions. This imbalance has long been a concern in the global economy, as some countries have been characterized by high levels of saving and current account surpluses, while others have experienced high levels of consumption and current account deficits. These imbalances have implications for exchange rates, trade flows, and financial stability, and addressing them requires significant adjustments in the behavior of both savers and spenders.

The implication of Cable's statement is that the process of deleveraging and addressing global imbalances will be challenging and will not be resolved quickly. The adjustment will be "long and painful," suggesting that it will involve difficult transitions, economic hardships, and potentially prolonged periods of economic restructuring.

Cable's perspective on the challenges of deleveraging and rebalancing the global economy reflects the broader concerns about the sustainability of economic growth and financial stability. Excessive leverage and imbalances in saving and spending can contribute to financial instability, asset bubbles, and unsustainable economic expansion. Addressing these issues requires coordinated efforts among policymakers, central banks, and market participants to promote more sustainable and balanced economic growth.

In conclusion, Vince Cable's quote underscores the significant challenges associated with deleveraging and addressing global imbalances in the context of the global economy. The process of reversing leverage and rebalancing saving and spending patterns will be complex and arduous, requiring long-term adjustments and potentially painful transitions. Understanding and addressing these challenges are critical for promoting a more stable and sustainable global economic environment.