U.s. Financial Regulatory Reform Of China's Financial Regulatory Revelation

The U.S. subprime mortgage crisis swept the global financial system, the global economy has been hit seriously, most countries have used funds to stimulate economic recovery and even save the bankruptcy of financial enterprises. On one hand, the financial crisis, partly because over-development financial derivative products, resulting in excessive leverage of the financial system and systemic risk increases, eventually leading to collapse of the financial system; On the other hand, it exposed the U.S. financial regulatory system problems:it focus only on the micro-prudential regulation and neglect macro-prudential regulation, and the financial regulatory system cannot find the systemic risk in the financial system.In July 2010, the "Dodd·Frank Wall Street Reform and Consumer Protection Act," officially released. The bill was considered the most stringent financial regulation bill after the Glass - Steagall Act in 1933. It will have a profound impact on the U.S. financial industry, as well as the development of the global financial industry. The Act has eight aspects reform contents to the entire financial regulatory system: the financial consumer protection, the end of the financial institutions "too big to fail" situation, the establishment of systematic risk monitoring mechanism, derivative products transparency and accountability, banking supervision strengthen, the executive pay and corporate governance strengthen, financial products risk monitoring enhancement, and insurance regulation strengthen. The regulatory philosophy, regulatory institutions and regulatory systems have made major changes:first, balancing the market mechanism and the government regulation and strengthen the macro-systemic risk prevention and the establishment of a comprehensive coverage of regulatory philosophy; secondly, achieve financial system consolidated supervision, improve the financial regulatory mechanism and increase the government regulation of self-regulation industry; finally established a systemic risk monitoring mechanism, strengthen the supervision of financial innovations and emphasis on financial consumer protection. Thanks to China's relatively closed financial market, in this financial crisis, the financial market has not been badly hit, but this does not mean that China's financial regulatory system is more complete. Objectively speaking, compare to the United States'financial market, China's financial market and the financial regulatory system are not yet mature and need further development and expansion. In the process of development, we should learn from the rapid development experience of Western financial markets in developed countries and lessons of the crisis.The main duties of financial supervision in China are charged with by the PBOC, CSRC, CBRC, and CIRC, which is strictly separate supervision. But with the combination of financial services, more regulatory approach cannot adapt to today's financial markets. The current financial supervision system have the following major issues:stock market "over-regulation",separate supervision exist "vacuum", the systemic financial risk supervision absence and financial consumer protection lack of laws and so on.With "Dodd·Frank Wall Street Reform and Consumer Protection Act" as a new regulatory philosophy, our financial reform should start with the following aspects:First, to correctly handle the relationship between government and market, the second is to strengthen the macro-prudential supervision, the third is to strengthen both the financial development and standardization of innovation, and the fourth is to strengthen financial consumer protection.On this basis, the paper also proposes a goal model of China's financial regulatory system and the idea of transitional model. Target model assumes that China's financial regulation achieves unified supervision under the financial reform Commission; and the transitional mode is that the financial supervision is coordinated by department of the coordination mechanism of the regulatory authorities and fulfills the overall supervision of the financial regulatory system.