Research On Repeated Reversal Of Liquidity And The Governments’ Responses During The Evolution Of The Financial Crisis

This dissertation is supported by2011National Social Sciences Planning Project(11BJL048)--The Research on National Repeated Reversal of Liquidity under the U.S.-ChinaEconomic Asymmetric Symbiosis.Subprime mortgage crisis is a landmark event in the history of world economicdevelopment, because it not only reflects the world ever closer economic ties, but also spawns anumber of specific economic phenomenon which not yet appeared before, repeated reversal ofmobility is one important example. From2006to2010, just four years, U.S. And China financialmarkets completed a complete interpretation of the volatility cycle: from surplus to shortage,shortage to surplus by the spill. We define this phenomenon as the repeated reversal of liquidity.The economy suffered a crushing defeat by the reversal of liquidity which spread widely, fastand deeply. In order to minimize the adverse effect, the governments made relevant policiesbased on its own status quo to prevent getting worse. But not all of them were successful. Thepolicy issue is not only an important front problem of financial area in China, but also a realisticquestion with the policy choice and adjustment. So it’s necessory for us to combine the policyand liquidity and go into. With the development of China-US relations, the chance of repeatedreversal of liquidity will rise. And, above all, we must research policy effect to adapt to theliquidity changes.This dissertation first analyzes the literature and present situations of U.S.-China’s liquiditychanges. It then carries on quite a comprehensive and systematical analysis of the repeatedreversal of liquidity. As the same time, regard the credit ceisis as the main context, it summariesthe changes and features of U.S.-China liquidity and lays the foundation for following policies.This logical and clear dissertation not only combs tarious relations, but also digs into fourtransmission mechanisms—dollar circulation, crisis proliferation, policy evolution and policyperformance. Starting with economic imbalance, it analysises the liquidity of first change andagain. Following the process, it analysises and researches the national policies, and seeks the effectiveness of policy for comparative analysis preparing for the changeable internationalsituation and financial turmoil.With the method of qualitative and quantitative, the dissertationexpolores the policy interaction. It details the policy spillover to economy and policy choice, andlays stress on deep influence, hard choice and the pressure of rmb appreciation.Given all of that,we treat the whole event as a classic case. After the concept introduction, root causes analysis,mechanism interpretation, we find that it is the policy push the event moving. In order to findwhether the policy is success or failure, the policy logic evolution are introduced, andcost-effectiveness is analysed. In the final chapter, we attempt to find out the basic reason of thesubprime crisis kicked off. Then from the stand of Chinese government, some constructiveadvice are put forward. It’s obvious that answering the question why and how will improve thedepth of theory.