China's Financial System Empirical Research Gap Problem

The recent emphasis in the Chinese theory researches is the road confidence, theoryconfidence, and mechanism confidence. But these confidences need more awareness ofunknown development and more critical thinking. In the past twenty years (1993-2012), it hasbeen the surplus problem of over-production and aggregate supply in Chinese economy. In orderto solve the scarcity of domestic aggregate demand, the Chinese government has always beencultivating consuming hot-points, enlarging infrastructure construction investments, strengtheningfiscal transfer payment, and stabilizing monetary value. Meanwhile, the sedimentary Differencesbetween the Deposits and Loans (hereinafter referred to as the DDL) in the Chinese financialsystem in the past20years has aroused an academic discussion on the Excessive Money Issue (EMI). For my points, it comes from the mismatching between the real economy and financialdeepening and from the transition of economy and society; its core future of so-called The ThirdType Asymmetry of Chinese Economy is based on the mixture between the sedimentary DDLand the surplus of aggregate supply, such as liquidity, labor, products, and productivity. In along-term future, the principal contradiction for hindering the GDP s growth shall be thesurpluses in the production and finance sectors in China.The sedimentary DDL in the Chinese financial system is a deeply-hidden systematic problem,which reflects the passive EMI problem and the commercial banking earnings besides the loans.This dissertation discloses an over100trillion RMB yuan of Chinese aggregate money reached atthe end of2012on the basis of statistically complementing Chinese M2, in which there are73trillion yuan of good credit and bond assets within92trillion yuan deposits as a tiger in a cage and27trillion yuan of the aggregate DDL. The18trillion yuan, the net DDL of the27trillionaggregate DDL, constitutes Chinese EMI. Under the circumstance of EMI, the mismatching ofessential production factors and the sharp contradiction in distribution system appear as theimbalance between supply and demand with the financial sedimentary DDL. The book is trying toanalyze the annual aggregate DDL in the past Yuan s63years, to empirically study the EMI inChina, and to explore systematic improvements on this mismatching of essential factors betweenthe Chinese financial system and the real economy.The discoveries in the dissertation are as the follows: firstly, the main obstacles ontoinvestments transformation and the capital composition in China are coming from the disabledcatching-up by investing added essential factors to the enlarging aggregate DDL, the disabledcoherence from essential factors’ allocation onto loan-able standards, and the organic combinationbetween the real economy and financial deepening; secondly, the more DDL, the more damages. Itmeans that the EMI, asymmetry between deposits and loans, fading-out medium power of financialsystem, sharpening the contradictions in the real economy, and stringing people’s nerves on EMIand unfair-distribution. Thirdly, in order to solve the contradictions in real economy, to defuse thesedimentary DDL, and to rebalance The Third Type Asymmetry of Chinese Economy, it isneeded to focus on the key, the finance, to rapidly modify the matching mechanism for investingmore added essential factors to absorb the sedimentary DDL, to manage and control under thediscipline of “Less Money Issue and More Credits and Bonds” by adding more completelyloan-able essential factors, to adapt the new mechanism in which there are four complete essentialfactors, qualified labor, recognized capital, earning model, and fund demand, for consummatingChinese reproduction processes, to replace as the mechanism of “distribution upon essentialfactors” for all human beings, to loosen the terminus monopoly, to quantitatively enlarge industriesin the urbanization process, to cultivate livelihood in the welfare, and therefore, the producers could find out the acceptable “loan-able projects”, unhindered investment channels, and durableincome expectations more easier.In the proposed Chinese financial reforms, the fiscal and financial combination shall beemphasized as one of China s Features to defuse the Chinese DDL by means of addingmatch-able production factors. Even the aggregate DDL is easy to increase and hard to decrease,this book concludes that the net DDL shall change its jobless position as an active player forserving the real economy, and that the aggregate DDL shall be controlled within the satisfied rangeby means of establishing a long term mediating mechanism to invest the added match-ableessential factors.