The subprime mortgage crisis in the United States has intensified, and how to deal with China s econ

The impact of the subprime mortgage crisis on the U.S. economy is deepening. Xie Fuzhan, director of the National Bureau of Statistics, said at the China Development Forum hosted by the Development Research Center on the 22nd that the impact of the subprime mortgage crisis in the United States is deteriorating, which is reflected in the deterioration of the U.S. real estate market, financial market turmoil, increased unemployment, reduced residents' expected income, declining consumer confidence, stagnant growth of consumer spending, credit crunch, and frustration of investor confidence.

We are experiencing the worst recession in the United States, and in the West. Economist Joseph Stiglitz pointed out that the United States is the world's largest economy and the main engine of economic growth, and now there are some serious problems in the American economy, which will have global repercussions.

Against this backdrop, it is unrealistic to expect China's economy to stand alone. Economist Stephen Roach believes. However, Xie Fuzhan believes that "the fundamentals of the current macroeconomic situation in China are good".

China is the biggest beneficiary of the entire globalization process. But while it shares in the benefits of the global economy, it is also affected by the global crisis. Stephen Roach said.

This impact can be from both the ** and the capital side. Chinese economist Fan Gang believes that the United States is an important market for China, and the decline in the U.S. economy, especially when consumption declines, will obviously have a certain impact on China's exports; On the capital side, there will be a possibility that due to the subprime mortgage crisis in the United States, the capital inflow into China will increase in the near future——— more funds mean more liquidity, and at the same time, it also means that it is easier to generate the risk of excessive growth in investment.

The subprime mortgage crisis and the resulting changes in the world economic environment have also pushed China more thoroughly to the crossroads where the mode of economic development must be changed, adding uncertainty to China's macroeconomic stability and development, and also adding new difficulties to China's macroeconomic regulation and control.

When the world economy is facing a crisis, a good prescription can quickly get out of it. Liu He, deputy director of the Office of the Financial and Economic Leading Group, believes that how to define global inflation at present? How can structural adjustment face the serious employment problem?

How do you view the lack of liquidity and excess liquidity in the global financial market? This is something we have to think about.

Xie Fuzhan pointed out that in order to cope with the changes in the international environment, in terms of short-term policies, it is necessary to continue to adhere to a prudent fiscal policy and a tight monetary policy, strengthen liquidity management, and maintain a reasonable growth of money and credit. From the perspective of long-term policy, it is necessary to deepen reform, change the mode of growth, adjust the economic structure, focus on independent innovation, and improve the overall competitiveness of our country and enterprises.

While maintaining the important task of long-term economic growth, we should pay attention to the changes that have taken place in the world economy in a timely manner and make appropriate adjustments to our policies. Fan Gang thinks.

Joseph Stiglitz further pointed out that in the current economic environment, China must pay attention to the issue of job creation in the process of macroeconomic policymaking.

This impact can be from both the ** and the capital side. Chinese economist Fan Gang believes that the United States is an important market for China, and the decline in the U.S. economy, especially when consumption declines, will obviously have a certain impact on China's exports; On the capital side, there will be a possibility that due to the subprime mortgage crisis in the United States, the capital inflow into China will increase in the near future——— more funds mean more liquidity, and at the same time, it also means that it is easier to generate the risk of excessive growth in investment.

It is time for the state's macroeconomic regulation and control to play a role in actively consuming to avoid economic depression.

Clause. 1. The subprime mortgage crisis mainly affected China's exports.

The impact of the subprime mortgage crisis on the Chinese economy cannot be ignored due to the slowdown in the US economy and global economic growth, and the impact on exports is the most important. In 2007, due to weak import demand from the United States and Europe, China's monthly export growth rate has declined from February 2007 to December.

Clause. Second, China will face the dual pressure of slowing economic growth and severe employment situation.

The real economy, especially industry, is under tremendous pressure. The closure of a large number of small and medium-sized processing enterprises has also exacerbated the grim situation of unemployment.

Finally, the subprime mortgage crisis will increase China's exchange rate risk and capital market risk.

In response to the negative impact of the subprime mortgage crisis, the United States adopted an accommodative monetary policy and a weak dollar exchange rate policy. The sharp depreciation of the US dollar poses significant exchange rate risks to China.

The financial crisis caused by the subprime mortgage crisis caused a major reshuffle in China's financial circles, and China's financial system collapsed.

The global financial crisis caused by the subprime mortgage crisis has produced more or less ** on the financial markets of all countries in the world, so that the excess liquidity that has existed in the global financial market for a long time no longer exists, and the economic development of all countries has encountered the problem of lack of funds.

On the one hand, the global financial crisis and economic downturn have led to direct losses for some of China's investment institutions, and on the other hand, it has dealt a great blow to China's foreign trade and exports. The weakness of exports has forced China to change its development model, changing the proportion of the troika in economic development, and in a sense, promoting the transformation of China's economy. If we can seize this opportunity and successfully carry out economic transformation, we will be able to leapfrog the trap of middle-income countries and leap into the sequence of developed countries.

Causes:

One of the root causes of this crisis lies in the neoliberal economic policies that the United States has accelerated for nearly three decades. The subprime crisis in the United States began when the Federal Reserve tightened monetary policy, and the rise in interest rates increased the cost of investment and reduced expected returns.

This was followed by subordinated loans and derivative valuations, which led to a decline in the value of risky assets, which ultimately led to tighter liquidity and significant volatility in financial asset markets.

As a result, the demand for real estate investment has decreased, and under the effect of rigid supply, real estate has begun to decline, which in turn has led to the increase in the overdue rate of subprime mortgages, and the risk of subprime real estate mortgages has emerged.

Implications: 1. Strengthen the supervision of real estate credit risk.

At present, the main funding for real estate development in China is bank loans. Real estate loans are characterized by rapid growth and large scale. And there are some "zero down payment loans", "fake mortgage loans" and "self-certification loans" in real estate credit.

Innovative credit products such as "plus mortgage", "remortgage", "revolving loan" and "net worth" loans are also on the market.

2. Strengthen the qualification review of personal mortgage loans.

An important reason for the outbreak of the subprime debt crisis in the United States is that mortgage companies provide loans with fewer restrictions such as zero down payment and zero documents to borrowers with relatively low credit ratings in order to chase profits, so that the hidden danger of subprime mortgage credit is lurking. Therefore, China's commercial banks must attach great importance to the hidden risks behind housing mortgage loans.

3. Pay close attention to the potential risks of fluctuations in the real estate economic cycle.

The U.S. subprime loan crisis has two lessons for commercial banks: first, ignoring risks in the upward phase of economic growth will inevitably lead to risks or even crises in the downward phase of economic growth; Second, we must reattach great importance to the risk of financial derivatives. China's real estate market has continued in recent years.

4. Improve credit soundness and strengthen risk management.

In the U.S. subprime crisis, the risk appetite of commercial banks increased their profitability due to the strengthening of the boom phase in the economic growth cycle, but the neglect of risks and the rapid expansion also laid hidden dangers for them. Therefore, maintaining a steady pace in rapid development is a rational choice to prevent problems before they occur.

Causes of the subprime mortgage crisis in the United States: The post-911 U.S. indiscriminate printing of money led to a flood of liquidity and a reduction in bank lending standards, which was the direct cause of the subprime mortgage crisis.

Impact on the United States: Although the subprime mortgage is small at about $100 billion, it is difficult to estimate the extent of the impact given the large number of credit derivatives that are based on this underlying asset. During the financial crisis of '97, the immediate cause was the collapse of long-term capital companies due to Russia's debt default.

At that time, the scale of Russia's defaulted debt was much smaller than the size of the subprime mortgage this time.

The impact on China is possible in the following ways:

1. The hedging withdrawal from the Chinese market will have a direct impact on the Chinese market.

2. The crisis further expanded in the United States and US consumption declined, which led to a global recession, a decline in China's exports, and a decrease in the ** surplus;

3. The withdrawal of international capital and the reduction of the surplus have led to a tightening of China's liquidity, which has had a serious impact on China's economy. Since '98, China's economy has been driven by liquidity, bank lending conditions are extremely loose, and a sudden tightening of liquidity would be a fatal blow to the economy.

Data for the first quarter of 2008 show that China's imports from the United States and Europe have grown rapidly, while exports have remained stable. So far, the subprime mortgage crisis has not had a significant impact on China and the United States. In the current subprime mortgage crisis, some Chinese financial institutions have suffered losses due to their possession of related financial products.

But Zhou Xiaochuan said that these losses are limited and are within the scope of digestibility. Chinese financial firms are healthier now than they were during the Asian financial crisis, and smaller losses will not affect their profitability and share prices. China's economy still has outstanding problems and deep-seated contradictions, such as excessive investment growth and excessive credit supply, inflationary pressure has increased, and uncertainty in the external environment has risen.

China will closely follow up and analyze the new situation and new problems, correctly grasp the rhythm, focus, and intensity of macroeconomic regulation and control, maintain steady and rapid economic development, and avoid major ups and downs.