The Generation Logic Of Systemic Financial Risks And My Country's Countermeasures

After the breakdown of the Bretton Woods system,financial crises are break out more frequently in various countries,especially in 2008,the global finance attracted people’s attention once again to financial stability and financial supervision.Every financial crisis is almost the result of long-term accumulation of systemic financial risks and is a process from quantitative change to qualitative change.At present,China is in the stage of economic transformation,and is increasingly linked with the international financial system.Systemic financial risks also begin to accumulate gradually in China’s economic system,it has progressively emerged in specific areas and aroused the great attention of the CPC’s and the state’s leaders.The Central Economic Work Conference in 2017 proposed "Keep the Bottom Line of No Systemic Financial Risks",and then,in 2018,the Central Economic Work Conference continued to put forward the idea of "taking precautions against and resolving major risks and tackling tough battles".But at present,the research on systemic financial risks is still insufficient,and the system is imperfection.In view of this background,this paper takes the generating logic of systemic financial risk as the research object,deduces the generating logic of systemic financial risk from the theory of modern money creation,and integrates the systemic financial risk’s source,carrier,and process into a complete logical framework for analysis.Moreover,the influence mechanism of systemic financial risks on financial system and economic structure is analyzed from the perspective of total amount and structure in this paper,and,a possible definition of systemic financial risk,“the economic phenomenon that credit expansion causes asset prices to grow apart from the fundamentals and makes the possibility of financial system encountering liquidity risk rise continuously”,is also proposed.On this basis,this paper analyses the occurrence process of the Great Depression in the United States,1989 Economic Bubble in Japan and the sub-prime loan crisis in the United States as the proof of the generation logic of Systemic Financial Risks.It finds that the process of risk generation and the mode of crisis occurrence before the three financial crises are consistent with the logic of systemic financial risk generation,therefore,we can prove the objectivity and correctness of this paper’s logical deduction.Finally,according to the generating logic of systemic financial risks,this paper analysis the sources,carriers and characteristics of systemic financial risks in China’s economic system,and in view of the current situation in China,the short-term and longterm strategy combination is put forward in this paper.The short-term strategy mainly focuses on stabilizing interest rate,broadening currency and increasing income,and the long-term strategies include financial supply-side reform,macro-prudence,hard budget constraints,property tax,increased investment in education and so on.