Influence Of Hot Money And The Prevention Measures

The research of hot money was begun in 1930s. The hot money always contacts closely with financial risk, such as the European monetary system crisis in 1992, the Mexican financial crisis in 1994 and the currency crisis in 1997, which rolled up the Southeast Asia. This paper first elaborates the origin, the development, the definitions, the characteristics, the origin and the scale of the hot money, on the basis of which, the author analyzes the relativity between the hot money and the national financial risk, and discusses the destruction of the hot money in the financial crisis of Southeast Asia, collecting with speculated monetary model.Now, the development of economy in china maintains perfect trend, and its rate of economic growth leads in the whole world. Under this situation, many people consider and expect the exchange rate of RMB will appreciate inside short time. In the same time, there are many risks inducing the stroke of hot money, such as the fragile system of bank, higher risk of stock market. All of these are the reasons induced huge hot money flowing into China.After China entered the WTO in 2001, we relaxed the foreign exchange controls gradually, speeded the process of financial opening, and increased the opening intensity of the financial services market, all of those provided convenience for the flowing of hot money to china. Hot money entered in stock market, estate market in order to chase huge profits.