The Reason Analysis And Enlightenment On The Subprime Crisis

On March 13, 2007, the subprime loan institutions in the United States, the new century finance declared on the verge of bankruptcy, which opened the curtain on the loan-to-crisis. In the next few months, the spreading of the impact of this crisis not only make international banking giants suffer from huge losses but also transmit panic to us stock market, causing the Dow Jones index, the Standard & Poor's index go down. Nay, the shocks of the U.S. stock market quickly spread to Asia and the world through the financial transmission mechanism, which set off financial crisis storm in the world.The United States claimed to have the world's most developed capital market and the most advanced risk prevention mechanisms, but why did so hard loan-to-storm happen in the United States? What part of the problem leading to the occurrence of the loan-to-crisis? These problems are inevitable or caused by human factors? These problems triggered lively discussion in theoretical and practical professions.The impact of subprime mortgage on china does not so strong because of the low level liberalization in China's capital market and the less financial institutions investment in the subprime mortgagee products. However, any country can be in the face of crisis "exception" in the background of the financial globalization and the liberalization, let alone China is lack in the prevention experience of financial risks by now. We should learn from the lessons of the loan-to-crisis and review whether we have the similar problems. In order that we can take precautions to ensure not to repeat the same mistake in the future.The author finds out possible causes of the financial turmoil happening with strongly interesting, and come up with separately the enlightenment and the recommendations for us, by analysis the loan-to-crisis on tow views of the risk management of financial institutions and the independence of the two rating agencies , In addition, the paper also arises the consideration of fair value accounting and auditing from the occurrence of the subprime crisis , because whether make use reasonably of fair value or not is an important issue to the prevention of financial risks.