Bubbles Research On Chinese Stock Market

The stock market in China has developed for more than 20 years, we can always observe the fact that the stock index fluctuated acutely and periodically, stock bubbles permeated the market everywhere.But the theories and research about the stock bubbles can not be seasoned with the economic system reform and market-building couse. Therefore, all sorts of problem,such as how to rationally define and measure the stock bubbles, how to truly analyse and estimate the effect that the bubbles throw to the economy, and how to control stock bubbles, defend and eliminate the bubbles' risk ,need a systemetical and transparent answer, this is the point of the paper. Furthermore, based on such problems, the ultimate aim is to bring forward the countermeasure for stock bubbles' control.First, we define what' the stock bubbles: it is a economic phenomena in the credit economy now that the market price of stock assets rise rapidly, far beyond its real value. Then the paper discussed from three sides: theory, actual system and participants' psychology , and indicate that the stock bubbles formed inevitability. Furthermore, the paper introduce the correlative theoris about the stock bubbles: dummy capital theory, effective market theory and financial noise theory.Secondly, we use the economic theories to analyse the stock bubbles and indicate that the stock bubbles has two sides: on the one hand, stock bubbles reduced the capital invested in the industry, in some conditions it will distort the capital market's function, make the macroscopical economy instabe. On the other hand, it has some advantages, for example, stock bubbles can stimulate the technical innovation, make technical reform develop forward, increase the financial store, and restrain the inflation.Thridly, we discuss the reason how the stock bubbles come into being. And pay attention to the particularity of Chinese stock market and search the reason from the national system, then we find the reason is that the government interven the stock market in excess, many companies coming into the market was too bad, the strcture of the stock investor is not perfect and information is spread asymmetrically. And then, we use the mathematics models to analyse the Chinese stock bubbles.Finally, based on the theoretical and actual research, we bring forward some suggestion to remove the Chinese stock bubbles.