Research On The Relationship Between Real Estate Bubble And Financial Risk

The history lessons of the Japan and Southeast Asian economic crises show us a common phenomenon that the financial risk is a natural concomitant of the real estate bubble. Tracing the source of the U.S. subprime mortgage crisis whose influence does not disappear completely, fair value is pushed to the cusp. Fair value records the bubble as accounting income reasonably, and the pro-cyclical effect of it has been widely recognized in the field of accounting. The measurement background aggravates the interaction between the real estate bubble and the financial risk, and becomes an important basis for the relationship of the two from the angle of accounting measurement. Researches before on the relationship are from different angles, such as"fictitious economy"and"capital movement". This paper will re-examine the macro phenomenon from the micro angle innovatively, choosing the perspective of accounting measurement and basing the fair value. The aim of this paper is mainly to solve the problems about how fair value impacts the real estate bubble and the financial risk, how about the interaction between the two under the background of fair value, and how about the situation in China.By comparative analysis and normative and empirical research methods combined, firstly, this paper reviews the researches on the real estate bubble and the financial risk, making a basis for the analysis based on fair value. Secondly, give an overview to the interaction between the real estate bubble and the financial risk, beginning with the research on the characteristics of fair value. Thirdly, under the background of fair value, do further research on the relationship between the real estate bubble and the financial risk from two different angles, and also get the proof from empirical tests separately. Finally, make an empirical test to the real estate bubble in China and propose preventive measures.