Research On Relation Of Assets Price And Of The Bank Credit Scale

With the developing of capital markets, asset prices fluctuate increasingly. Modern economic and financial theory has recognized the correlation between the asset price volatility and the real economy. Meanwhile, the U.S. subprime mortgage crisis has impacted real estate market and financial system stable operation. In this crisis we cannot ignore the phenomenon that the bank credit expands and contracts, asset prices rise and fall. In recent years, Chinese stock market and real estate market have largely fluctuation, and bank lending has also repeatedly expansion. Therefore, the researching on the relationship of Chinese asset price and bank credit will be in favor of maintaining Chinese stable development of securities market and real estate market.Based on theory analysis of the asset prices and bank credit, this paper take the monthly data of asset prices (stock prices and real estate prices) which from 2002 to 2010, we establish four variables VEC model on stock market and real estate market. Through researching on the long-term equilibrium relationship between the variables and short-term dynamic relationship, we get the different conclusions on the stock market and real estate market. From the stock market, in short term, there is no correlation between bank credit and stock prices; in long term, stock prices and bank lending feedback each other reversely. From the real estate market, in short term, real estate prices and bank lending affect each other positively; in the long run, real estate prices and bank lending correct negatively. The results show that the two markets should be different for the operation of law puts forward policy recommendations. For example, for the stock market, government should optimize the capital market structure, and strengthen the depth and breadth of financial supervision. For the real estate market, government should adjust industry structure and credit structure. In addition, there are several measures to optimize Chinese financial mechanism, such as reinforcing the ability of bank lending management, the ability of controlling the bank risk, progressing the monetary policy system.