The Monetary Phenomenon In China's Capital Market And Commodity Market

In recent years,with the rapid economic development in China.The urbanization rate has risen rapidly and the investment in urban infrastructure construction has been steadily increasing.But with the consequent rise in real estate prices,abnormal fluctuations in the stock market,rising M2 to GDP ratio,etc.While creating a miracle in China's economic development,the Chinese government inevitably laid down many hidden dangers and became an obstacle to the sustainable development of China's economy and gradually became the focus of attention of the general public.This article first analyzes China's broad money generation mechanism and its basic flow,expounds the role played by foreign exchange funds and credit expansion mechanism in the formation of broad money,and starts with the generation mechanism to analyze the possible flow of China's broad money.At the same time,the Chinese market is broadly divided into a capital market and a commodity market based on the possible currency flow.The capital market includes the real estate market and the stock bond market.The commodity market includes the consumer market and the producer market.This article selects the broad money supply M2,real estate price index,stock bond price index,CPI and monthly PPI data from 1997 to 2017 to illustrate the impact of broad money on China's capital market and commodity market.In the empirical part of this paper,the author first uses the traditional VAR model to describe the relationship between variables.According to the results of theoretical analysis.China's generalized currency generation mechanism has undergone major changes around 2008.The shift from the original foreign exchange purchases to the expansion of credit is the main reason.Therefore,the author divides time into two parts based on the 2008 boundary.The results show that the changes in China's economic structure have been reflected in the model,showing different results,indicating that C:hina's economy has been in a process of constant change.Based on this,the author uses the TVP-VAR model to characterize the interaction of economic variables at different times.By selecting time points of representative policies,the different role relationships among variables are demonstrated,explaining the impact of current affairs policies on China's economic structure,and further expounding the currency phenomenon of China's capital market and commodity market.The author emphatically analyzes the different roles of economic variables during the real estate reform in 1998,the RMB 4 trillion plan in 2009 and the real estate regulation in 2016.The results show that during the RMB 4 trillion plan period,China's broad money flows mainly to the real estate industry.In recent years,the phenomenon of China's economic divestment has become more serious.The capital market has played a very important role in the formation of China's credit currency,and economic reforms and structural adjustments are Imperative.