The entry of hot money led to false economic prosperity. Judging from the current situation in China, while betting on the expectation of RMB appreciation, hot money is constantly looking for arbitrage opportunities in the real estate market, bond market and stock market, especially in the real estate industry. In recent two years, the real estate price in China has exceeded 12%. Especially in Beijing, Shanghai and other big cities, real estate prices have risen by more than 20% every year. A very important reason why many real estate developers are unwilling to lower house prices is the illusion of international hot money.
The influx of hot money has increased the scale of foreign exchange, disrupted the normal operation of the financial system and intensified the domestic inflationary pressure.
In 2004, the base money investment reached more than 660 billion yuan, and it is estimated that the inflow of hot money will be about 654.38+000 billion US dollars. Therefore, the inflow of hot money alone exceeds the investment of the base money in the whole year, forcing the central bank to use a large number of central bank bills in the open market for compulsory write-off, which greatly increases the operating cost of the central bank, but also reduces the initiative of China's monetary policy and increases the pressure of inflation.
The inflow of hot money has increased the pressure of RMB appreciation.
With the increase of hot money inflow, the pressure of RMB appreciation has increased. The outflow of hot money makes the economy fluctuate violently. If the hot money flows out quickly on a large scale, it will make some speculative market prices fluctuate greatly, such as the rapid decline of real estate prices and bond prices and the sharp shock of the stock market.
Hot money refers to hot money or speculative short-term funds. In the business dictionary, hot money is defined as "extremely liquid short-term capital that can quickly flow to any country that can provide better returns".
Shanghai Securities R&D Center believes that traditional hot money mainly refers to international short-term capital, but according to China's national conditions, hot money includes both international short-term capital and medium-and long-term capital.
The purpose of hot money is to spend as little time as possible in Qian Shengqian. Short-term speculative funds that flow quickly in the market just for the pursuit of high returns are purely speculative profits, not creating jobs, goods or services. 201110 In June, the newly increased foreign exchange holdings10 showed negative growth for the first time in the past four years, and overseas hot money withdrew from China. It has affected China's economy to varying degrees.
The objects of hot money speculation include stocks, gold, other precious metals, futures, money, real estate and even agricultural products such as red beans, mung beans and garlic. During the decade from 200 1 to 20 10, the hot money flowing into China averaged $25 billion a year, equivalent to 9% of China's foreign exchange reserves in the same period.
The biggest difference between hot money and legal investment is that the fundamental purpose of hot money is to make profits by speculation, not to create jobs, goods or services.
Using mathematical formula, the definition of hot money is:
The increase of foreign exchange reserves of a country (or region)-foreign direct investment-trade surplus = hot money.
High yield and risk: Pursuing high yield is the ultimate goal of hot money in the global financial market. Of course, high returns are often accompanied by high risks, so hot money earns high-risk profits. They may have made money in this market and lost money in another market, or they may have made money in another market and lost money in this market, which also gives them the awareness and ability to take high risks.
High degree of informatization and high sensitivity: hot money is the darling of the information age. Be highly sensitive to the current economic and financial situation and trends of a country, a region or the world, exchange rate differentials, interest rate differentials and price differentials in various financial markets, and be able to respond quickly to the economic policies of relevant countries.
High liquidity and short-term: based on high information and high sensitivity, you can enter quickly when you earn money, and you can escape instantly when the risk increases. Show great short-term, even ultra-short-term, fast in and out in a day or a week.
Investment is highly fictitious and speculative: hot money is a kind of investment fund, which mainly refers to its investment in global securities market and currency market, in order to gain profits from the price fluctuation of securities and currency, namely "Qian Shengqian", which has a certain lubricating effect on financial markets.
If there is no risk aversion like hot money in the financial market, it is impossible for risk aversion to transfer risks. However, the investment of hot money neither creates jobs nor provides services, which is highly fictitious, speculative and destructive.