Connection Analysis For Money Market And Capital Market In China

From may 1,1996 to June l0,l999, our country went down the short-termrate for seven times. According to the nature connection, the rate fluctuation in themoney market would result in the fluctuation of capital in the capital market, and makethe change to stock price. The adjustment of short term rate in money market inChina did not cause proportionate reaction in capital market. Compare to this, in U.S andthe other developed country,it Produce gate effect for the rate change to the stockmarket .so it arose my attention to the connection between money market andcapital Market. After that,china reformed the finance market, the connectionsbetween money market and capital market have been changed, thecharacter of confluent have been increased. but there are a longdistance to international economic integration,financial globalization and financialliberty. It is my intention to find out the deep--seated reason,and table a proposal.This dissertation begin with the analysis of theory, after the definition ofmoney market and capital market,1 advance the character of connections between thesetwo market: undivided, price interacted, emulative. The connections are related towhat degree the market belong to and what policy the country use in financial market,the integration of financial market in advanced country is achieved by policy reform .this article compute the connection between money market and capital market by theanalysis of Stat and measure and find that through the reform,there are connection in acertain extent,but it is so fragility. The reason is the restriction in financialmarket,especially management in money market and capital market is separate. Inthe background of globality, it is this policy vice made by man that holdup the flow ofcapital,and decrease the efficiency .With the experience of advanced country,Iadvance the suggestion to reform the separate management in money market andcapital market .In the same time,in order to suit the situation of my country,I alsodiscuss the problem in WTO.According the character of money market and capital market,thisdissertation use these means' first, theoretic and practice. The means of theoreticis not only to explain the facts of finical development,but also to summarize the facts. Inorder to support the theoretic,there are also some numbers to back it .Second,comparisonand deduction .this article also use the means of comparison to compare the finical marketin china with foreign countries,it can study the market in all kinds countries. Third,analysis and conclusion. With the analysis in china and other country,I concludethere characters of money market and capital market: price-interacted, undivided, andemulative. These can offer the base to analysis the money market and capital market inchina.In short,this dissertation have some innovations: Fist,conclude there characters ofconnection in money market and capital market. Second, use some numbers to prove thetheory. Third,analysis the probIem of separate operation and incorPorate management infinical market.Financial market include money market,capital market and foreign exchange market .thesethere markets are complex system, but because the field of study and ability,thisdissertation doesn't take over the connection between foreign exchange market and moneymarket,foreign exchange market and capital market, this would study in the future.