——————————— 0941022113 international economy and trade Liu Bing

Since the beginning of this year, under the background of globalization, China's economic development is facing many new situations, and China's economic development is also facing many new shocks and challenges. As a student majoring in economics at school, I would like to express my humble opinions and opinions on the current economic situation in China. In recent years, economic problems have aroused the concern of the broad masses of the people throughout the country. Some new terms, such as "garlic is cruel", are always heard on TV news, which seems to remind us that the inflation period in China has come. As students of the School of Economics, we will read various professional financial news magazines on weekdays. In my opinion, when we constantly emphasize how bad China's current economy is and how to expand its economy, we must never forget to look at the problem from the perspective of the overall economic situation and not blindly follow it. We should look at these economic phenomena from a fair and rational perspective. Recently, I read Professor Lang Xianping's article on the analysis of China's economic situation, which deeply touched me.

Faced with these challenges and impacts, although the economic growth rate of China has slowed down since the second half of last year, the economy of China has maintained a good growth momentum on the whole. Since this year, our economic growth rate has been declining from the first quarter, the second quarter to the third quarter. For example, our economic growth rate was 10.6% in the first quarter, 10. 1% in the second quarter and 9% in the third quarter. Judging from this development trend, China's economy is slowing down as well as the global economic growth. However, it is not easy for China's economy to maintain an average or cumulative growth rate close to 10% when the global economy is obviously slowing down. But recently, China's economy seems to have an inflation trend that people don't want to see. Recently, a questionnaire survey of 100 economists and entrepreneurs shows that nearly 90% of the respondents think that the current inflation situation in China is severe (73%) or already very severe (about 15%). This reflects the current general feelings and concerns about inflation. At the same time, the survey shows that less than 40% (38%) people think that the primary task of China's economy next year is to curb the further aggravation of inflation. In contrast, this ratio is significantly lower than the ratio that inflation is serious or already very serious. In other words, although most people agree that inflation is a serious problem, they do not advocate putting inflation first.

Let's take a look at the policies and measures recently adopted by the China government to deal with economic and financial problems:

In response to the downward pressure brought by the financial crisis, China implemented a proactive fiscal policy and a loose monetary policy in 2008. The consequence of this policy is that while maintaining the growth rate of GDP, it also brings the excessive growth of money stock. At the end of 2009 1 1, the broad money supply (M2) increased by 29.74% year-on-year, with an increase of 1 1.92, and the narrow money supply (M 1) increased by 34.63% year-on-year. The growth rate of money supply is much higher than that of nominal GDP.

Excessive money supply leads to inflationary pressure. Although the consumer price index (CPI) turned positive in June+10/October 2009 due to overcapacity and other reasons, in the coming year, the upward trend of prices has been formed, and residents' expectations for prices have gradually increased.

Facing the pressure of inflation, China government put forward the policy proposition of "managing inflation expectation" for the first time. Obviously, this is a brand-new topic. So how to understand inflation expectations, how to understand the transmission mechanism of expectations to real inflation, and what policy tools are used to manage inflation expectations is particularly important.

Using loose monetary policy to stimulate economic growth has become an important policy choice for countries to deal with the financial crisis. Most economists believe that increasing the money supply can lower interest rates, thus stimulating investment and consumption. But from the monetarist point of view, the increase of money stock will eventually affect the change of the overall price level.

After the money stock increases greatly, the market's expectation of inflation will gradually appear, but both Keynesianism and monetarism believe that the adjustment of inflation expectation will be very slow. However, in the view of rational expectation school, inflation expectation is often formed shortly after the substantial increase of money stock.

It is obviously very useful for monetary policy makers to understand how inflation expectations are affected by monetary policy behavior, monetary policy transmission process and other economic development factors, but it is not easy to really manage inflation expectations.

In his speech at the 2008 annual meeting of the Federal Reserve, Federal Reserve Chairman Ben Bernanke admitted that there are some ways to measure the expected inflation, such as surveys to understand family expectations, forecasts by professional economists, and collecting information from the inflation index bond market. Unfortunately, however, the expected information provided by price makers called enterprises is very limited. What kind of expected information is the most important for the dynamic evolution of inflation, and how the central bank finds the best way to collect relevant information from various channels is still a problem.

Rational expectation holds that actors can make accurate judgments on economic policies and their consequences, so the policy-making process often lags behind public expectations, so the policy is invalid. Of course, one of the assumptions of rational expectation is that information is scarce and will not be wasted in the economic system. But the actual economic operation is a kind of incomplete information condition. If the government and the public have an information advantage in the game, they may be able to use policies to influence expectations.

In China's current economic environment, it is difficult for the government to manage inflation expectations.

Although China's CPI growth rate has just turned positive, the government emphasizes that the inflation rate will remain low in 20 10, but due to the dynamic inconsistency of low inflation monetary policy, it is doubtful whether this low inflation target policy choice can be realized.

In the middle and late June of 2009, the People's Bank of China conducted a questionnaire survey on urban depositors in 50 large, medium and small cities in China. The survey results show that the residents' satisfaction index with the current price is 28.2%, which is 1.3 percentage points lower than the previous quarter, showing a continuous downward trend. In the fourth quarter, the future price expectation index was 73.4%, up 6.6 percentage points from the previous quarter, and it has been rising continuously since this year.

Judging from the current credit and money supply plan for next year and the current price management, it is difficult to produce a convincing signal. The government can only lobby the public to recognize the low inflation target set by the government from overcapacity and CPI level, but the public does not accept the explanation of low inflation based on the rational expectation formed by the information of the economic system held by the public, which may lead to the dynamic inconsistency of policy implementation, thus making the actual inflation level exceed the policy target set by the government. Judging from the actual economic operation, farmers in northeast grain-producing areas have formed the expectation of price increase at the end of the year, so they have implemented the strategy of hoarding and not selling; Residents in major cities expected that house prices would continue to rise, so there was speculative buying at the end of the year.

Although inflation seems to have become a reality, people ignore the progress made by China's economy in many other fields. Recently, the National Bureau of Statistics is releasing the data of 10. According to the data of 10, some basic indicators supporting China's economic growth still maintain a good momentum. During the period of 1- 10, our industrial growth, investment in fixed assets, utilization of foreign capital, import and export of foreign trade, etc. still maintained double-digit growth, and most indicators also maintained a growth rate of more than 20%. In addition, from the general trend, China's economic development experienced relatively high inflation from the second half of last year to August this year. Therefore, the policy orientation of our macro-control this year is to curb the excessive rise of inflation, curb the excessive rise of prices and turn it into full-scale inflation. We should try our best to adjust the unreasonable proportion structure in China's economic development by stimulating and accelerating the growth of domestic consumption and domestic investment. It should be said that gratifying steps have been taken in this regard this year. With the rapid growth of domestic demand, foreign trade exports still maintained a good growth rate. Although the growth of external demand has obviously slowed down, which has a great impact on China's foreign trade exports, China's foreign trade exports still achieved a growth rate of 2 1.9% from June to June, and the foreign trade surplus reached 21600 million US dollars. In addition, on the economic front,

In addition, the supply of oil and edible oil has also been restored, and the excessive rise in the overall price level, which was once driven by the excessive rise in edible oil prices and grain prices, has been significantly curbed, and the supply structure of agricultural and sideline products has been effectively improved. During the period of 1- 10, the added value of industrial enterprises above designated size increased by 14.4%, and the growth rate of energy-intensive industries continued to decline. This shows that while ensuring economic growth, China government also pays attention to promoting structural adjustment and further curbing the rapid development of some industries with high energy consumption, high resource consumption and serious environmental pollution. In the process of rapid economic development, people's lives have further improved, and employment and residents' income have maintained rapid growth. In the first three quarters, 9.36 million new jobs were created in cities and towns nationwide, and the registered unemployment rate was 4%. The per capita disposable income of urban residents and the per capita cash income of farmers actually increased by 7.5% and 1 1% respectively. After the Wenchuan earthquake, the national recovery and reconstruction plan has been completed and the people's lives in the disaster areas have been properly arranged.

In terms of system reform, this year, China promoted the reform of collective forest right system and straightened out the system and mechanism of forestry development, which is considered as the second landmark reform content of rural economic system reform in China. The reform of county and township management system was further promoted. In terms of enterprise reform, the pilot work of establishing and improving the board of directors of wholly state-owned enterprises continued to deepen. Through merger and adjustment, the telecommunications industry has formed three market operators with full-service operation capabilities. The aviation industry system reform was implemented and the railway investment was diversified. In terms of fiscal and taxation financial price reform, the new enterprise income tax law was implemented, the farmland occupation tax was temporarily used, the reform of China Development Bank and Agricultural Bank was steadily advanced, the foreign exchange management regulations were revised, and the foreign exchange management system was ready to go. The price adjustment of refined oil and electricity has improved the production enthusiasm of enterprises and played a role in ensuring domestic energy supply.

In response to the impact of the international financial crisis, we will implement a proactive fiscal policy and a moderately loose monetary policy. The American subprime mortgage crisis, which began in April last year, has evolved into a global financial crisis. At present, the global financial crisis is still intensifying, the international financial market is in violent turmoil, the world economy has been severely impacted, and many countries' economies have entered recession, which has gradually revealed and deepened the negative impact on China's economy. Although China's economy has maintained a high growth rate of 9.9% this year, the growth rate is gradually slowing down, and the downward pressure on economic growth is increasing. In view of the sharp decline in the international situation, since July, the China government has changed the primary task of macro-control from preventing excessive economic growth at the beginning of the year to preventing overheating of the economy, and preventing prices from changing from structural rise to obvious inflation, and adjusted it to maintain steady and rapid economic growth and control excessive price increase. With the rising trend of the current price level clearly curbed, and with a view to maintaining steady and rapid economic growth and controlling excessive price rise, after July, the central bank lowered the deposit reserve ratio and deposit and loan interest rates of financial institutions twice, guided commercial banks to expand the total amount of loans, and adjusted the export tax rebate rate for textiles and clothing in a timely manner. 10 Since late June, in view of the increasing impact of the international financial crisis on China's economy, the CPC Central Committee and the State Council have made timely arrangements for major economic work, adjusted China's macroeconomic policy orientation in a timely manner, adhered to flexible and prudent macroeconomic policies, and successively introduced a series of policy measures such as supporting and stabilizing agricultural production and foreign trade exports, increasing investment in people's livelihood security, and strengthening support for small and medium-sized enterprises. The People's Bank of China lowered the loan interest rate of financial institutions again. Recently, the central government clearly proposed to implement a proactive fiscal policy and a moderately loose monetary policy, and introduced more favorable measures to expand domestic demand, speed up people's livelihood projects, infrastructure, ecological environment construction and post-disaster recovery and reconstruction. In order to improve the income level of urban and rural residents, especially low-income groups, and promote steady and rapid economic development, ten measures have been determined to further expand domestic demand and promote economic growth. These measures are not only to stimulate the current economic growth, but we can see from the contents of the policy that some of its longer-term connotations are to lay a solid foundation, enhance the stamina of economic development, cultivate the market based on the long-term, create the vitality and motivation of demand, adhere to expanding investment and optimizing the structure simultaneously, and replace consumption with investment.

China has the conditions to maintain sustained, steady and rapid economic growth. At present, China's economic and social development is in a critical period. While clearly understanding the difficulties, we should also see the favorable conditions and positive factors to cope with the changes in the external environment and promote scientific development. First of all, we should see that since the beginning of this year, China's economic growth rate has slowed down, which is due to the cumulative effect of weakening external demand and national macro-control. Over the years, in the face of the contradictions of excessive economic growth, seriously uncoordinated proportion of investment, consumption and export, large consumption of energy and resources, heavy environmental pressure and extensive development mode, the central government has been hoping to moderately slow down China's economic growth by strengthening and improving macro-control and realize sound and rapid economic development. This year, the economic growth has declined moderately, which is exactly what the central government expected. As the society said, China's economic development is developing in the expected direction of macro-control. Secondly, it should be noted that after 30 years of reform and opening up and rapid economic growth, China's comprehensive national strength and ability to resist various risks have been significantly enhanced. More importantly, the market economic system established in Socialism with Chinese characteristics after the reform and opening up can not only make good use of the market mechanism and give full play to the basic role of the market in allocating resources, but also have the advantages of effectively exerting national macro-control, mobilizing and organizing resources, and concentrating on major events. Third, China has a large population, a large market, low per capita income and people's living standards, and its economic and social development is in a period of accelerated industrialization and urbanization. The potential of expanding domestic demand based on the domestic market is still huge. The contradiction between unreasonable economic structure and extensive development mode in China is still very prominent. To realize scientific development, we must intensify structural adjustment and accelerate the transformation of development mode. Whether it is accelerating the development of industrialization and urbanization, accelerating the construction of a well-off society, constantly improving and raising the quality and level of life of the people throughout the country, or promoting the upgrading and optimization of economic structure, improving technological progress, strengthening environmental protection, promoting resource and energy conservation, and promoting the transformation of development mode, many new demands will be generated. Therefore, there is a broad space to lay a foundation for sustained, coordinated and rapid economic development or growth in China, and to promote steady and rapid economic development by expanding domestic demand.

We have reason to believe that with the joint efforts of the people of the whole country, China will be able to cope with and solve all kinds of contradictions, risks and difficulties in the process of modernization, better meet the country's construction and the people's growing material and cultural needs, and combine with improving the supply capacity and supply structure, we have the conditions and ability to maintain the rapid economic development of China in a long period of time.