Very detailed information
In July 1997, Thailand's Thai baht was attacked by international speculators because it was artificially overvalued, and the Central Bank of Thailand used foreign exchange reserves to maintain a relatively fixed linked exchange rate. However, with the continuous decline of market confidence, the linked exchange rate became more and more difficult to maintain. On July 2, 1997, the Central Bank of Thailand announced that the Thai baht would implement a managed floating exchange rate, which caused the Thai baht to plummet and quickly spread to neighboring countries, among which
in June p>1997, a financial crisis broke out in Asia, and the development process of this crisis was very complicated. By the end of 1998, it can be roughly divided into three stages: June to December 1997; January 1998 to July 1998; July 1998 to the end of the year.
the first stage: on July 2, 1997, Thailand announced that it would abandon the fixed exchange rate system and implement the floating exchange rate system, which triggered a financial storm throughout southeast Asia. On that day, the exchange rate of the Thai baht against the US dollar dropped by 17%, and the foreign exchange and other financial markets were in chaos. Under the influence of the fluctuation of Thai baht, Philippine peso, Indonesian rupiah and Malaysian ringgit have become the targets of international speculators. In August, Malaysia gave up its efforts to defend Ringgit. The Singapore dollar, which has always been strong, has also been hit. Although Indonesia was the latest country to be "infected", it was the most seriously affected. In late October, international speculators moved to Hong Kong, an international financial center, aiming at Hong Kong's linked exchange rate system. The Taiwan Province authorities suddenly abandoned the exchange rate of the new Taiwan dollar and depreciated by 3.46% a day, which increased the pressure on the Hong Kong dollar and the Hong Kong stock market. On October 23rd, the Hang Seng Index in Hong Kong dropped 1,211.47 points. On the 28th, it fell by 1,621.8 points, falling below the 9,-point mark. In the face of fierce attacks from international financial speculators, the Hong Kong SAR Government reiterated that it would not change the current exchange rate system, and the Hang Seng Index rose to 1, points. Then, in mid-November, a financial storm broke out in South Korea in East Asia. On the 17th, the exchange rate of the won against the US dollar fell to a record 1 8∶1. On the 21st, the South Korean government had to seek help from the International Monetary Fund, which temporarily controlled the crisis. However, on December 13th, the exchange rate of Korean won against the US dollar dropped to 1 737.6∶1. The Korean won crisis has also hit the Japanese financial industry, which has invested heavily in South Korea. In the second half of 1997, a series of banks and securities companies in Japan went bankrupt. As a result, the Southeast Asian financial crisis evolved into the Asian financial crisis.
the second stage: in early 1998, Indonesia's financial turmoil resumed, and in the face of the worst economic recession in history, the prescription prescribed by the International Monetary Fund for Indonesia failed to achieve the expected results. On February 11th, the Indonesian government announced that it would implement the linked exchange rate system to maintain a fixed exchange rate between the Indonesian rupiah and the US dollar, so as to stabilize the Indonesian rupiah. This move was unanimously opposed by the International Monetary Fund, the United States and Western Europe. The International Monetary Fund threatened to withdraw its aid to Indonesia. Indonesia is in a political and economic crisis. On February 16th, the exchange rate between the Indonesian rupiah and the US dollar fell below 1,: 1. Affected by this, the southeast Asian currency market has made waves again, and the Singapore dollar, Malaysian dollar, Thai baht and Philippine peso have all fallen. It was not until April 8 that Indonesia and the International Monetary Fund reached an agreement on a new economic reform plan that the Southeast Asian currency market was temporarily calm. The Southeast Asian financial crisis that broke out in 1997 put the Japanese economy, which is closely related to it, in trouble. The exchange rate of Japanese yen dropped from 115 yen to the dollar at the end of June 1997 to 133 yen to the dollar at the beginning of April 1998. In May and June, the exchange rate of the Japanese yen fell all the way, once approaching the mark of 15 yen to 1 dollar. With the sharp depreciation of the yen, the international financial situation is more uncertain and the Asian financial crisis continues to deepen.
the third stage: at the beginning of August 1998, when the American stock market was in turmoil and the exchange rate of the Japanese yen continued to fall, international speculators launched a new round of attacks on Hong Kong. The Hang Seng Index has been dropping to over 6 6 points. The Hong Kong SAR Government responded by using the Exchange Fund to enter the stock and futures markets, absorbing the Hong Kong dollars sold by international speculators, and stabilizing the foreign exchange market at the level of 7.75 Hong Kong dollars to 1 US dollar. After nearly a month of hard struggle, international speculators suffered heavy losses and could not realize their attempt to use Hong Kong as a "super cash machine" again. While international speculators lost in Hong Kong, they suffered a crushing defeat in Russia. On August 17th, the Russian Central Bank announced that it would expand the floating range of the exchange rate of the ruble against the US dollar to 6. ~ 9.5 ∶ 1 during the year, postpone the repayment of foreign debts and suspend the trading of national bonds. On September 2, the ruble depreciated by 7%. This has caused the Russian stock market and foreign exchange market to fall sharply, triggering a financial crisis and even an economic and political crisis. The sudden change of Russian policy has greatly hurt the international speculators who have invested huge amounts of money in Russian stock market, and has led to the comprehensive and violent fluctuations in the foreign exchange market in the stock markets of the United States and Europe. If the Asian financial crisis was still regional before this, then the outbreak of the Russian financial crisis shows that the Asian financial crisis has gone beyond the regional scope and has global significance. By the end of 1998, the Russian economy was still in trouble. In 1999, the financial crisis ended.
the financial crisis broke out in p>1997 for many reasons, which Chinese scholars generally think can be divided into direct trigger factors, internal basic factors and world economic factors.
the direct triggers include: (1) the impact of hot money in the international financial market. At present, there are about $7 trillion in floating international capital around the world. Once international speculators find out which country or region is profitable, they will immediately attack the currency of that country or region through speculation in order to make huge profits in the short term. (2) Some Asian countries have improper foreign exchange policies. In order to attract foreign investment, they maintain a fixed exchange rate on the one hand and expand financial liberalization on the other, which provides an opportunity for international speculators. Thailand, for example, deregulated the capital market in 1992 before its financial system was straightened out, which made the short-term capital flow unimpeded and provided conditions for foreign speculators to speculate on the Thai baht. (3) In order to maintain the fixed exchange rate system, these countries have used foreign exchange reserves for a long time to make up for the deficit, leading to the increase of foreign debt. (4) The foreign debt structure of these countries is unreasonable. In the case of more medium-term and short-term debts, once the outflow of foreign capital exceeds the inflow of foreign capital, and the domestic foreign exchange reserves are not enough to make up for it, the devaluation of the country's currency is inevitable.
The internal basic factors include: (1) the high growth of overdraft economy and the expansion of non-performing assets. Maintaining a high economic growth rate is the common aspiration of developing countries. When the conditions for high-speed growth become insufficient, in order to maintain the speed, these countries turn to borrowing foreign debts to maintain economic growth. However, due to the unsmooth economic development, by the mid-199s, some countries in Asia were no longer able to pay their debts. In Southeast Asian countries, the bubble blown by real estate only brought bad debts and bad debts of bank loans; As for South Korea, because it is too easy for large enterprises to obtain funds from banks, once the enterprises are in poor condition, the non-performing assets will expand immediately. The existence of a large number of non-performing assets has in turn affected the confidence of investors. (2) The market system is immature. First, the government intervenes excessively in the allocation of resources, especially in the loan investment and projects of the financial system; The other is that the financial system, especially the supervision system, is not perfect. (3) The defects of the "export substitution" model. The "export substitution" model is an important reason for the economic success of many Asian countries. However, this model also has three shortcomings: first, when the economy develops to a certain stage, the production cost will increase and the export will be restrained, which will cause the imbalance of international payments in these countries; Second, when this export-oriented strategy becomes the development strategy of many countries, it will form mutual extrusion between them; Third, the step-by-step progress of products is a necessary condition for continuing to implement export substitution, and it is impossible to maintain competitiveness by relying solely on the cheap advantages of resources. These countries in Asia have not solved the above problems after achieving rapid growth.
what is worth talking about in the 21st century is, of course, the global financial crisis that broke out in 28.
The introduction is as follows: The global financial system is facing the biggest crisis since 1929. How did the ailment that started in the American real estate subprime mortgage market lead to a deep global crisis? Why is Wall Street so fragile? What role should the government hand and the market hand play in this crisis, and how to save the global economy from collapse?
The subprime mortgage crisis has finally completely broken the myth of Wall Street. After Bear Stearns was shot down, Lehman Brothers, the fourth largest investment bank in the United States with a long history of 158 years, is also dying. Whether it is bankruptcy or bail-out, Lehman's once prestigious position is definitely an indicator event in the post-war financial history. Because this is not a case, but a big outbreak of systemic risk.
The current world is experiencing a once-in-a-century financial crisis.
what is the financial crisis
the financial crisis, also known as the financial storm, refers to the sharp, short-term and super-cycle deterioration of all or most financial indicators of a country or several countries and regions (such as short-term interest rates, monetary assets, securities, real estate, land (price), the number of commercial bankruptcies and the number of financial institution failures).
financial crisis can be divided into currency crisis, debt crisis, banking crisis and other types, which is characterized by people's expectation that the economy will be more pessimistic in the future, and the currency value in the whole region has depreciated greatly, resulting in great losses in economic aggregate and scale, and economic growth has been hit. It is often accompanied by a large number of business closures, rising unemployment rate, general economic depression in society, and sometimes even social unrest or national political turmoil.
the causes of the financial crisis
the most fundamental cause of the financial crisis in the United States is the decline in the solvency of subprime borrowers caused by the decline in housing prices in the United States. The savings rate of American residents has been declining. When American residents' debts are too high to support the housing bubble, the housing market adjustment is inevitable, which in turn leads to a significant increase in the default rate of subprime and prime floating rate mortgage loans, and more and more mortgage borrowers are unable to repay their loans.
once these mortgage loans are collected, it will cause credit losses. The subprime mortgage crisis is getting worse and worse, causing major financial institutions on Wall Street to close down or be taken over, and the glorious era of Wall Street has finally come to an end.
on September 15th, the U.S. government refused to help Lehman Brothers, and Lehman Brothers announced that it would seek bankruptcy protection. The financial crisis caused by subprime mortgage will deepen, and the downward trend of the global economic boom cycle is almost a foregone conclusion.
Up to now, three of the top five independent investment banks on Wall Street have disappeared within six months, and more financial institutions are waiting for fate judgment. An ultimate question arises: Has global financial capitalism come to an end, and should the government be more involved in the micro-operation of the market?
Greed and fear are reflected in all aspects of the subprime mortgage crisis. Richard Bitner, an American real estate mortgage expert, revealed the terrible truth in the book The Truth of the Subprime Mortgage Crisis-almost every aspect is full of lies and false assessments. Federal Reserve Chairman Ben Bernanke rebuked that "a considerable part of lending in recent years is neither irresponsible nor prudent", which is almost synonymous with madness and irrationality in the language system of the Federal Reserve Chairman.
But the truth is by no means so simple. The subprime mortgage crisis not only exposed the madness of financial institutions, but also exposed the madness of the economic development model led by the US government. Real estate loans in the United States are the basis for supporting loan consumption. Buyers buy houses through loans, obtain consumer loans through value-added houses, and sell real estate loan products to the world after securitization through various financial institutions-a chain of loans, consumption and production is formed with real estate as the center, and global dollar assets are continuously gathered in the United States in the form of liabilities or creditor's rights. In the chain of mortgage securitization, Fannie Mae and Freddie Mac in implicit government guarantee played a pivotal role.
isn't it? It was the intervention of the U.S. government that made the U.S. bond securitization market flourish in the late 198s. It was the measures to boost consumption by using mortgages that made the U.S. economic data in the Clinton era colorful. It was the implicit guarantee of the U.S. government that made billions of subprime mortgage products sell all over the world through Fannie and Freddie. It can be seen that the subprime mortgage crisis is not only the disillusionment of the financial capital market, but also the bankruptcy of the national policy of financial capitalism led by the US government to save the American economy and save consumption. If the financial market collapsed, it was also the collapse of the US government and American financial capitalism.
the innovation ability of American financial market is incomparable, but no financial market can resist institutional fraud, and the subprime mortgage crisis just shows a large area of institutional fraud, from rating agencies to guarantee companies.
in the process of counterfeiting, financial assets have exploded. According to McKinsey Global Institute, the proportion of global financial assets in global annual output has soared from 19% in 198 to 316%, and in 25, the global core assets stock has reached 14 trillion US dollars. In the same period, the proportion of financial assets in Britain rose from 278% to 359%, while that in the United States rose from 33% to 45%. Josef Ackermann, CEO of Deutsche Bank, said: "I no longer believe in the self-repairing ability of the market." The government took over Fannie and Freddie and saved Bear Stearns, which showed that the government's control ability had reached its limit.
after the subprime mortgage crisis, the international financial market will undergo profound changes. The intuitive performance is that the volume of financial assets has fallen and investors have become more and more conservative. Joseph Yam, President of the Hong Kong Monetary Authority, said, "In the end, everyone may find it necessary to go back to basics and recognize the fundamental purpose of financial intermediation again, and the regulators responsible for protecting public interests should also realize that the simplest method may be more cost-effective in the long run." In fact, we don't want to be fooled by Wall Street's complicated financial derivatives. The basic function of the financial market is to finance funds, not to make greedy people reap huge profits.
investors began to protect themselves, holding cash and investing in the most conservative assets in order to survive the severe winter: investors in all markets reduced their leverage positions; Investors turned to safe assets such as cash and treasury bonds. The subprime mortgage crisis shows that financial derivatives should have clear boundaries, and financial markets tend to be conservative, which recognizes the conservative trend. The global financial market will not turn around again until the current economic downturn triggered by subprime mortgage is safely passed.
Those countries that once believed in the American financial innovation system will become more cautious. They don't trust the complicated financial system that is difficult to control. The subprime mortgage crisis will make them see the destructive power of the unregulated financial market, and sovereign investment funds and financial innovation in various countries will be more cautious.
However, it can be believed that financial capitalism will not return to the road of government regulation, but will move towards the road of strengthening supervision. Otherwise, the US government will continue to help Lehman Brothers and dozens of financial institutions threatened by bankruptcy. Possible supervision