Analysis Of China's Stock Price Bubble Cause And The Risk Control Of China's Stock Market

The bubble economy is a major source of economic crisis, Once the bubble burst, it will inevitably affect the financial security, economic crisis also may be followed by. Stock bubble is one of the main vector of the bubble economy, The stock market bubble is a bubble economy induced by the important factors. The ever-expanding stock market bubble is the precursor of the bubble economy. Thus the analysis of the causes of stock market bubble and risk prevention is very important to reduce financial risks and safeguarding financial security, prevention of financial crises and maintain the health of the stock market and economic development.The stock market bubble of contemporary economics is one of the forefront of the field, Economists in developed countries in this field of study has a number of preliminary results, while these conclusions are directed at the major developed countries. Domestic research in this area is just beginning, the research of stock market bubble is contained in the research literature, foreign bubble economy emerged in the study of new problems, and new methods introduced to the country is still limited.For China, only a dozen years of development of immature market, the stock price bubble was caused by a background of its own national conditions,The prevention of the risk should be formed on the condition of the special reasons. This article focuses on China's special background, on the basis of simple empirical analysis to sum the causes of China's stock price bubble and risk prevention.The article first reviewed the history of the famous stock market bubble incident, combining the characteristics of the stock market, defined the stock market bubble. Then the article adopted a profile of the stock market, with price-earnings ratio indicators at the same time, shows that the Chinese stock market is a bubble market. Then combining China's national conditions, the article summarizes the reasons of China's stock market bubble, according to that, the article puts forward the countermeasures.