The Cause And Impact Of American Sub-prime Mortgage Crisis

The United States broke out in 2007 sub-mortgage crisis—sub-loan crisis in subsequent years, the mortgage company the verge of bankruptcy, forced liquidation of hedge funds, investment banks, announced losses of commercial banks and insurance agencies have also suffered heavy losses, global stock markets drop, sub-loan-induced credit risk eventually evolve into a global financial crisis. The United States because of the sub-loan crisis caused by such serious consequences, because subprime mortgages are already through asset securitization instrument of financial innovation that has become subordinated bonds to enlarge so that it can diffuse to the entire global financial sector as well as the United States.The United States sub-loan crisis in the background and reasons for various reasons are a result of General. The United States to take in order to stimulate the economy continued to cut interest rates led to a real estate bubble policy. Continuous increase in order to control the rate of inflation increased by sub-loan applicant's default risk, resulting in the shrinking real estate market, capital market liquidity crunch losses so that the bond holders. Through the process of asset securitization are passed and amplified, so that mortgage-strand break company funds, hedge funds and investment banks suffered huge losses. Followed by the second loan is a threat to investment banks and secondary market investors, commercial banks, insurance companies and pension funds also suffer.The United States sub-loan crisis in the United States not only to the real estate market and financial markets have a huge impact, but also the real economy of the United States and the global financial system have a great impact. Cause of many sub-sub-loan mortgage company suffered heavy losses, continued low real estate market in the United States. Meeting the United States credit crisis has also led to declining domestic demand, economic growth slowed down, the risk of entering an economic recession. In terms of international, sub-loan crisis induced by the global stock market crash, global financial markets has also led to a liquidity shortage, the U.S. dollar depreciation affected simultaneously to normal credit markets and the real economy. The United States sub-loan crisis on the development of Chinese real estate market has a lot of inspiration. Of commercial banks, the risk awareness should be enhanced to strengthen the housing mortgage loans in commercial bank risk control, it is necessary to make rational use of credit ratings and the importance of external regulation. Supervision of the financial sector, the financial industry to enhance the unity of the operating General supervision and transparency, improve the level of risk regulation. Securitization of assets said that it is necessary to guard against moral hazard, securitization of assets and specific legislation, and to reduce the risk of the proliferation of non-performing assets. For government departments to ensure the stability of China's real estate market development, taking into account the effects of monetary policy, a sound credit system and increase personal risk awareness education, and improve government capacity to deal with the crisis.