Reasons Of American Subprime Loan Crisis And Revelation For China

American subprime mortgage crisis is an ongoing economic problem which widely impacts on finance market through commercial banks, investment companies and hedge fund corporations. It lead to a global finance crisis, and have caused very bad effects on the real economy. The crisis started with the burst of real estate bubble, higher delinquency rate of subprime mortgage and adjustable-rate mortgage. Excessive financial innovation, loose financial supervision and distorted rating are main reasons of the spread of this crisis. The crisis which causes the giant loss of finance corporations, the violent fluctuations of globe stock market and foreign exchange market, and the contraction of credit market, these problems force governments to take a series of solutions to stimulate the economy, to promote economic growth and inspire the confidence of investors.In this thesis, the formation and the impact of the American subprime mortgage crisis are introduced, the emphasis is the damage to USA and world economy generated by subprime mortgage crisis, its destructiveness is very clear. Then the subprime mortgage crisis's origin has been analyzed. Through the analysis of the game between financial innovation and government regulation, the rating organization's distorted assessment results, and profound international background, the revelation about the development of Chinese finance market, the financial innovation and which supervisory method and intensity, and economic growth pattern is obtained, and puts forward the corresponding policy proposal.The worsening of American subprime mortgage crisis indeed is the result of capital securitization, but we can't thorough negative financial innovation because of this crisis, on the contrary, our country not only need carry on the financial innovation, but also speed up the financial innovation process for China's national conditions. The key of our country to avoid crisis's occurrence under the financial innovation's situation is to provide supervision which match the financial system, and to control the risk of, the capital market as well as to transform our country economic growth pattern.