Central Bank Bills

Central bank security came out in 2002 in china. On the one hand, it is called central bank bill to be the new operating instrument of open market operations. On the other hand, it is used to support the reform and restructuring of financial institutions which is named specialized central bank bill.Are the central bank securities only used in china, or used in many other countries? Why does our central bank issue its own securities? Do central bank securities make some bad effect? Can them be used forever by central bank? With these questions, I wrote the paper to research the central bank comprehensively.The main content of the paperThe second chapter introduces some basic knowledge about the central bank securities. Firstly, it introduces the central bank securities's situation of foreign countries and analyzes the reasons of the appearance of central bank securities. Secondly, it introduces the central bank securities in our country.The third chapter introduces the central bank bills as the instruments of open market operations. The first part introduces the operating theory of central bank bills. The second part empirically researches the efficiency of open market operations when the central bank bill as the instrument of money policy. By Granger Causality Test and Co-integration test, we found it is efficient to regulate the commercial bank liquidity and sterilization. The last part analyzes the bad influence.The forth chapter analyzes the essence of the central bank bills to support the financial institutions. The central bank used the specialized central bank bills to help the financial institution to reform is act as the lender of last resort. Actually, the central bank helps the financial institution by making money, which may causes serious bad effect.The last chapter points out that: no matter the central bank bills or the specialized central bank bills, both of them as the debt of central bank make the operating losses to central bank and may weaken the financial strength of central bank.Main point of the paperThe central bank bills do play important function now. It is necessary for central bank to issue its own security. But, we must know that there are some disadvantages of central bank bills and the disadvantages may cause many bad effects which may affect the development of finance and economy. So, the central bank bills can only be the transitional tools.Creation and achievement of the paper1.It researches the central bank security of china contains both central bank bill and specialized central bank bill. Actually, both of them are the central bank security as the debt of central bank and they are only used in different areas. In foreign country, there is only one name no matter the central bank security is used as the instrument for money policy or to support the financial institutions.2.It researches the efficiency of the central bank bill to sterilization. Firstly empirically analyzes the efficiency of the central bank to regulate the commercial bank liquidity and lead the rate of money market from it being issued.3.Calculate the amount of the central bank bills issued by central bank and the cost of the central bank to issue the central bank bills.4.Point out: The central bank used the specialized central bank bills to help the financial institution to reform is act as the lender of last resort. Actually, the central bank is help the financial institution by making money, which may causes serious bad effect.5.Introduces that: the central bank bills as the debt of central bank make losses to central bank and may weaken the financial strength of central bank.