Research On The Risk Of China's National Debt Market And Its Precaution

In recent years, a noticeable phenomenon has appeared in the economy of our country--The circulation of the national debt increases severely. For example, the issuance of national debt by our government is 888,330 million Yuan. It includes book bond 195 billion Yuan, registered bond debt 653,330 million Yuan, savings bond 40 billion Yuan. In the sense, the economy of our country becomes economy of the national debt. The main investors of the national debt market have already been composed of the commercial banks; investment subjects which agreement financial institution; personal investors and foreign investors and so on. And the main investors are getting larger and larger. And its trade is getting more and more active. Consequently, the scale of the influence of the national debt is getting wider and wider to the economy and the power of the influence is getting more and more intense. The government and the folk have been paying attention to it. The research about the national debt market has become a focus in the economy field. Since 1981 our country issued the national debt, the national debt market developed rapidly. But there are lots of defects in the national debt market. The studies on the defects of the national debt have already achieved great success, but the analysis of it in the view of the investors is very rare.In order to make up the rareness, the thesis analyzes the basic situation of the national debt market and infers some new conclusions. It makes the investors review the risk of the national debt market. In addition, the thesis draws some lessons from the studies of finance and put forward some measures to prevent the risk.The thesis divides into four parts:The first part: the general summary of the risk of the national debt marketThe thesis defines a series of basic concepts at first such as risk, national debt, national debt market, etc."portfolio selection theory"is one of the basic theories which used extensively in the fields of western investors. Because its representative, the thesis divides the risk of the national debt market into the un- systematic risk and system risk according to this theory.The second part: the un-systematic risk of the national debt market. The credit risk is the main un-systematic risk of the national debt market. This chapter is divided into two parts: at first, the credit risk is analyzed at standard. Then, the thesis analyzes the credit risk in three dimensions. By analyze the scale of the national debt and speed of expansion from issuing history of national debt of our country, we get conclusion: the scale of national debt expands rapidly. Then, we figure out three indexes which were used to measure the degree of the national debt market. Compared with the international datum, two indexes are unreasonable. At last, we analyze the contingent debt of our government. And the burden which shouldered by our government is serious. According to the analyses in three dimensions, we can draw a conclusion: we must believe in the existence of credit risk of the national debt market.The third part: the systematic risk of the national debt.The systematic risk of the national debt market includes many kinds of risks, divided into interest rate risk, inflation risk, the circulation risk, etc. In the thesis, we discuss the interest rate risk particularly. The thesis explains the interest rate market system of our country at first. Then, it sums up the modulation of the interest rate since 1990. And take the modulation of interest rate on October 29th 2004 and August 19th 2006 for example, it analyzes the influence that the interest rate works to the national debt market including issuing market and exchanging market.We analyze the inflation risk on base of a formula that actual earning ration = nominal earning ratio– inflation ratio. The thesis discusses the circulation risk on the foundation of the defects of the exchanging market.The fourth part: the tactics to prevent against the risk of the national debt market.Thesis analyzes the ambition of the investors in the national debt market. Then, it put forward a kind of tactics to prevent against the risk of the national debt market. The tactics include various kinds of strategies, but in all, there are three kinds, such as the positive tactics, the passive tactics, and the mix of the two. As one coin has two sides, each strategy has its own advantage and shortcoming. All the investors must apply them in the right time and in the right way.