China's A-share Crash in 2015- -Based on the Perspective of the Liquidity Barrier Lake Caused by the "Targeted Easing" Policy

Weixin Pan; Linze Yu

doi:10.54097/9jwpf798

Authors

Weixin Pan
Linze Yu

DOI:

https://doi.org/10.54097/9jwpf798

Keywords:

Stock market crash; monetary policy; liquidity.

Abstract

This paper is based on the theory of liquidity effect, that the 2015 crash is formed by directional easing liquidity of the lake, namely the central bank directional loose monetary policy derived monetary is not through monetary policy transmission channel to the entity neighborhood, but deposited in the financial system, pushing up the rising asset prices, and cause industrial "real to virtual", further boost the financial asset prices and the real economy fundamentals mismatch. Small and medium-sized enterprises and state-owned enterprises local government "hidden guarantee" of real estate, city investment companies in financing credit discrimination, and commercial Banks to lend behavior, also led to the liquidity of the formation of the lake finally, this paper summarizes a series of Suggestions, such as accelerating the marketization of interest rate reform, improve the monetary policy management, improve the macro-prudential monetary policy framework, establish and improve the multi-level capital market measures, to prevent such problems from happening again, make the central bank's monetary policy can more powerful through the financial system to the real economy, promote the development of our country economy with high quality.

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