At present, the global economy is still in a "cold winter". In order to get out of the quagmire of the financial crisis as soon as possible, governments around the world continued to implement large-scale rescue plans in 2009. So far, among these rescue plans, the decision to buy 1. 15 trillion US dollars of treasury bonds and mortgage bonds announced by the Federal Reserve on March 8, 2008 is the biggest shock to the world, because this decision shows that in response to the financial crisis, the Federal Reserve boldly adopted the quantitative easing monetary policy commonly known as "printing money". As the world superpower, the world's most important economy and the birthplace of this once-in-a-century financial crisis, the change of American economic situation plays a vital role in the global economic trend. Any decision made by the U.S. government will have more or less influence on the policy-making of other major economies, so the quantitative easing monetary policy of the Federal Reserve will also have an important impact on the global economic trend. 1. With the deterioration of the economic situation, the Federal Reserve has to implement quantitative easing monetary policy, commonly known as "printing money", which was proposed by the Bank of Japan in 200 1. Refers to a country's monetary authorities injecting excess funds into the market by printing a lot of money, buying government bonds or corporate bonds. The purpose is to lower the market interest rate and stimulate economic growth. This policy is usually adopted by the monetary authorities only when the conventional monetary policy is ineffective in stimulating the economy, that is, the unconventional monetary policy implemented under the condition of liquidity trap. The Federal Reserve unexpectedly announced its plan to buy 1. 15 trillion US dollars of treasury bonds and mortgage bonds, and officially launched the quantitative easing monetary policy. Quantitative easing monetary policy is a very radical monetary policy. The Federal Reserve launched a huge capital injection plan in this way for the following reasons: First, there is no room for the implementation of conventional monetary policies such as interest rates, and the Federal Reserve has no choice. Since the outbreak of the financial crisis, the Federal Reserve has exhausted its interest rate policy, and the federal benchmark interest rate has been lowered from 5.25% to 0 ~ 0.25%. In the case that the interest rate policy has come to an end, the Fed has to implement a quantitative expansion policy to continue to maintain the driving force for economic expansion; Secondly, since last year, American debt was once popular because of its hedging function. However, the long-term depreciation of the US dollar and the risk of bond credit default, coupled with the stagnant or decreasing growth of foreign exchange reserves of Asian buyers, have made the US debt a hot potato. Investors, including China and Japan, tried to avoid risks by selling a lot of long-term bonds in exchange for short-term bonds, which pushed up the interest rate of long-term government bonds, so the Fed had to buy long-term government bonds to reduce interest rates. Finally, the Fed's move itself shows that the American economy has reached a very critical situation, which is an extraordinary policy adopted in an extraordinary state. Judging from the published data, the economic situation in the United States is not optimistic. In February, the unemployment rate in the United States further climbed to 8. 1%, setting a new high in nearly 25 years. In February, the credit card default rate also rose to a 20-year high. Second, the impact of the Federal Reserve's quantitative easing monetary policy on the global economic situation. Quantitative easing monetary policy is a "double-edged sword". On the one hand, it injects a lot of money into the market, keeping the market interest rate at a very low level, prompting banks to lend, thus stimulating investment and consumption and contributing to economic recovery; However, on the other hand, it has buried the hidden danger of inflation. In the case of stagnant economic growth, it may lead to more serious stagflation and a sharp depreciation of the national currency. While stimulating domestic exports, it will worsen the economic situation of relevant trade subjects and produce trade frictions. For the United States, the world economic hegemon, the impact of implementing this radical policy on the domestic and global economy should not be underestimated. 1. Quantitative easing monetary policy may help the US economy to embark on the road of recovery as soon as possible. The original intention of the Federal Reserve's bold implementation of quantitative easing monetary policy this time is to reduce the interest rates of mortgage loans and other consumer loans and stimulate spending to help revitalize the US economy. Whether this huge bond purchase plan can help the United States get rid of the worst financial crisis in more than 70 years is still too early to draw conclusions. However, at least in theory, quantitative easing monetary policy will help the US economy embark on the road to recovery. The Federal Reserve's bond purchase plan includes $300 billion of long-term treasury bonds, $750 billion of mortgage-backed securities guaranteed by Fannie Mae and Freddie Mac, and up to $654.38 billion of institutional bonds. The Fed's purchase of U.S. Treasury bonds will push up the price of treasury bonds, depress the yield, and help lower long-term interest rates. Accordingly, because the interest rates of many loans and securities assets are based on US Treasury bonds, they will also drive down other interest rates, thus stimulating investment and consumption. In addition, the financial crisis originated from the real estate market in the United States, and whether the real estate market can recover is the key to whether the American economy can get out of recession. The Fed's purchase of mortgage-backed bonds guaranteed by Fannie Mae and Freddie Mac will directly push down the mortgage interest rate. Affected by the huge bond purchase plan of the Federal Reserve, on March 20th, the yield of mortgage loans backed by mortgage loans issued by Fannie Mae and Freddie Mac fell to the lowest level in two months, which indicates that the bond purchase plan of the Federal Reserve may push the interest rate of new loans to a historical low in a short time, thus attracting buyers to re-enter the market, prompting the real estate market to recover as soon as possible, thus stabilizing the US economy. 2. The quantitative easing monetary policy has buried the hidden danger of global inflation. After the Federal Reserve announced that it would start printing money and inject huge amounts of money into the market, the market was most worried that the Fed's move would lead to the weakening of the US dollar, the rise of commodity prices and the hidden danger of global inflation. Affected by the huge capital injection plan of the Federal Reserve, the US dollar index has fallen rapidly from a high level recently, and the prices of crude oil, gold and non-ferrous metals have skyrocketed due to the depreciation of the US dollar. Since the pricing of major commodities in the world is based on the US dollar, the depreciation of the US dollar may trigger a new round of resource price increase, which will not only ease the global deflation situation, but also sow the seeds of inflation. Moreover, if quantitative easing monetary policy fails to put the American economy on the road to recovery, economic recession may lead to stagflation. In addition, after the Federal Reserve issued a large number of currencies, other countries did not want to see their currencies appreciate against the US dollar on a large scale, which in turn prompted other central banks to expand currency issuance, so that the price of the whole asset would gradually rise. Recently, the central banks of Britain, Japan and other countries have announced that they have bought a large number of their national bonds in the secondary market, which means that all major economies in the world have started to implement quantitative easing monetary policy, and inflation may follow. 3. The quantitative easing monetary policy has worsened the economic situation of relevant trading entities. The quantitative easing monetary policy of the Federal Reserve will lead to the weakening of the US dollar, which will not only push up commodity prices, but also lead to the sharp appreciation of other currencies against the US dollar. In fact, on the day when the Federal Reserve announced its huge capital injection plan, the world's major currencies appreciated sharply against the US dollar, including the appreciation of the euro by 3.5%, the yen by 2.4%, the pound by 1.6% and the Canadian dollar by 1.7%. This will weaken the export ability of relevant trading entities to the United States, especially for those export-oriented emerging economies in the whirlpool of the financial crisis. This move by the Federal Reserve will make it worse and may trigger trade frictions. 4. The Federal Reserve buys bonds on a large scale to reduce the value of foreign exchange assets of the corresponding debtor countries. Although the financial crisis originated in the United States, due to the strong economic strength of the United States and the unique international status of the dollar, American debt was once popular because of its hedging function. Among the foreign exchange assets of many governments, including China, US Treasury bonds occupy an important position. The Fed's massive purchase of US Treasury bonds will push up the price of US Treasury bonds and reduce their yield. On March 8th 10, the yield of US benchmark 10-year treasury bonds plunged from 3.0 1% to 2.5%, the biggest one-day drop since 198 1, which will lead to the huge depreciation risk of foreign exchange assets of the corresponding debtor countries. For the United States, the depreciation of the dollar and the decrease in the yield of national debt are likely to lead to a huge amount of foreign capital flowing out of the United States, which is also a cruel reality that the American economy still in the whirlpool of the financial crisis has to face. Third, how does the China administration respond to the quantitative easing monetary policy of the Federal Reserve? As the largest creditor and major trading partner of the United States, the implementation of quantitative easing monetary policy by the Federal Reserve will lead to multiple pressures on China, which we should correctly understand and actively respond to. The first pressure is the preservation of foreign exchange assets. In China's huge foreign exchange reserves, US dollar assets account for half of the country. The depreciation of the US dollar and the decline in the yield of US bonds will directly lead to the sharp depreciation of China's foreign exchange assets. The main way to reduce the risk of depreciation is to diversify the investment direction of foreign exchange reserve assets, thus reducing the proportion of dollar assets. Judging from the current global economic situation, it is very necessary to increase investment in resource products such as gold and energy and related enterprises when asset prices are at a relatively low historical level and there is a big inflation hidden danger in the future. Secondly, the RMB exchange rate issue. The United States is China's second largest exporter. The quantitative easing monetary policy of the Federal Reserve will increase the pressure of RMB appreciation, which is undoubtedly a heavy blow to China's foreign trade export enterprises that are in trouble due to the financial crisis and RMB appreciation. Therefore, it is very important to maintain the stability of RMB exchange rate. In addition, we can increase exports to other trading partners to weaken the impact of dollar depreciation on China's exports, or further increase the export tax rebate rate to cushion the impact of dollar depreciation on China's export industry. Finally, due to the influence of domestic credit and resource price reform, there is a potential inflation risk. If the price of international primary products rises, this trend will be promoted. In this case, the government should pay close attention to market changes, adjust relevant policies in a timely and flexible manner, and control inflation within a moderate range. Quantitative easing monetary policy is a "double-edged sword" with many side effects. This is a very radical monetary policy, and the Fed has to do it. As the most important economy in the world, the quantitative monetary policy of the Federal Reserve will have an important impact on the global economic situation. We should correctly understand the enormous pressure brought by the Federal Reserve to China, and actively respond to it to minimize its side effects on China's economic development.