A Research On Government Bond Market Of Modern China

Government bond was introduced to China under the background of Eastward Transmission of the Western Science.The three domestic loans: Xijieshangkuan,Zhaoxin Stock and Patriotic Bond signified the embryonic stage of modern China government bond system and government bond market.Domestic government bond system and regulations developed as the National Government established;meanwhile,government bond became an important measure to solve the public finance problems.The steady government bond issuing system and secondary circulating market tremendously supported the development of modern China capitalist economy and the Anti-Japanese War;nevertheless,all of the modern China governments’ financial solvencies were so weak that they all abused the government bond measure,and eventually their credit collapsed,and the government bond market declined.The dissertation mainly researches the modern China government bond market,which consists of the issuing market and the secondary circulating market.The dissertation follows the principle of the unity of history and logic,which means holding the whole history of 1840-1945 modern China government bond issuing market and secondary circulating market as an object that has adherent logic and law.I will step by step reveal and research the historical political environment,economy,military and social reality,then make some analysis.I will keep my eyes both on the whole picture of the modern China government bond history and the details of it.The dissertation makes theoretical and positive researches about the issuing system,the interest structure,the payment system,types of government bond,trading price in the secondary market,and volume of trading.According to the above objectives,the dissertation consists of three parts divided to one introductory remark and four chapters.The first part is the introductory remark.The introductory remark mainly explains why this dissertation focus on the topic of modern China government bond market,and makes a summary of the forerunners’ research on this subject.I also make some definitions related to government bond market and line out the range of research in this dissertation.The second part is the main part of the dissertation.The first chapter analyses the government bond market of the later Qing dynasty at the beginning.The three domestic loans: Xijieshangkuan,Zhaoxin Stock and Patriotic Bond signified the embryonic stage of modern China government bond system and government bond market.Although all this three loans had articles about secondary trading,there were no actual trading deals of them.The government bond market has not established yet in this period.Then,this chapter deals with the bond market of the Northern Warlord Government.The Northern Warlord Government established the Bureau of Internal Government Bond in 1914 and issued many government bonds,which were guaranteed by the revenue of the customs and the salt taxes after deducting the Boxer Indemnity and external debt.The other government bonds with low credit were guaranteed by other revenue of taxes.Abusing of issuing government bond is another trait of the government bond market of the Northern Warlord Government period.As the bond credit fallen,the government began to issue treasury bills for the solvency of the administration.The first stock exchange of China was established during the Northern Warlord Government period naming Beijing Stock Exchange.Lots of banks located in Beijing and Tianjin other than Shanghai were estabilished by government officials.They actively speculated the government bonds.Government bond was almost the only active securities in Beijing Stock Exchange after the Xinjiao Agitaion.All of the above information signifies the establishment of the modern China government bond market.The second chapter epounds the government bond market during 1927-1937 of the Nanjing Naional Government period.The government bond market developed a lot during this period;both the supplies and the demands were prosperous.The National Government issued 2,600 million internal government bonds to cover the expenses of the military and administration,which is four times the amount of the Northern Warlord Government.The government bond issuing market was steadier and more prosperous than the former period during this period,meanwile the secondary circulating market was extremely active and attractive.Shanghai Chinese Stock Exchange was the main exchange of the government bond.The issue of plenty amount of government bond was the key to the stability of the Nanjing National Government and was helpful to the success of the Anti-Japanese War.The third chapter analyses the government bond market in the AntiJapanese War period.The function of the bond market declined in this period because of the controlling policy and the monetary reform.On the issuing aspect,the importance of internal debt declined in the treasury of the government.The ratio of internal debt to the financial deficit fallen from 80%-90% at the most to 0.8% at the least.The National Government made great efforts to sell the government bond,but it became more and more difficult to succeed.On the secondary circulating aspect,Shanghai Chinese Stock Exchange was closed by the government,and the government bond market entered into the period of stagnation.Although all aspects of the society appealed the government to open the exchange many times,the government worried about the shunt of capital and the impact to the issuing market.The exchange reopened until 1943.The third part is the fourth chapter.It is the conclusion and the enlightment from the modern China government bond market.This chapter fuses the history of government bond market from the later Qing dynasty to the end of the Anti-Japanses War as a cohensive whole,and makes analysis of the transition of the system both in the issuing market and the secongdary circulaiting market.The enlightment from the history includes many aspects.We should both value the finance aspect and the finance market aspect of the government bond market.We should keep an eye on the scale of the government bond.It is important to smooth the connections of issuing market and the secondary circulating market.We should strike the insider trading in the bond market.As long as a trading rule is going to be modified,there should be a suitable length of transmittion period.We also get some enlightment from the history on local government debt raising problems.We should strengthen the infrastructure of the bond market and enhance the credit of the government.There are three innovations in this dissertation.The first one is the innovation of the viewpoint.I portray the whole picture of morden China government bond market history.The second one is the method of research.I take the method of historical comparison in some part of the dissertation.The last one is the objective of research.I rearch both the issuing market and the secondary circulating market.Some of the historical materials are out of my control which I should improve in the future.