Bank Of America, The Dynamic Cross-border Capital Output Analysis

Through being one of the biggest and fastest-changing entities in the world, we have to face the status of constantly opening our native capital market and sharply increasing the foreign investment demand. The financial crisis not only brought us a great challenge, but also brought us a greater opportunity. Meanwhile, the State Council advanced the idea that it will build Shanghai into an international financial center. With the ever-saturated market for the competition between the domestic and foreign banks, how will the banking manage to get out of the dilemma, which is the fundamental pillar of the financial industry?This paper used the empirical method to validate that the foreign investment among 1967-2007's of the American banking directly related to its GDP and FDI, by adopting Eviews, which is the software of measurement statistical analysis. Nevertheless, this paper used the same way to figure out the opposite outcome of the foreign investment among 1993-2006's of the Chinese banking. Meanwhile, we also found that the Chinese banking similarly developed though 1980 to 1990, comparing to the American. Through the outcome from two entirely different models to analyze the reason, this paper analyzed the motivation of the foreign investment of American transnational banks from the macro, micro and policy dimensions, and also brought forward the suggestion to China.The suggestion to China mainly explained by means of the foreign investment strategy and tactics. Since, under the constant increase of the GDP in china, the augment of the native foreign investment will gain the well development of the Chinese banking. But the Chinese banking didn't expand such like that, which didn't comply with the export-oriented economy. Furthermore, national extensive foreign investment should make the freely currency convertible as the premise.