The real economy is the activity of human production, service, consumption and circulation, and the virtual economy refers to the financial assets formed by credit expansion and trading activities unrelated to the real economy. The credit expansion of financial market begins with the credit and capitalization of money. The original form of money is precious metal, which corresponds to the real economy one by one. With the development of economy, paper money and credit money have replaced metal money, which is the process of currency creditization; With the emergence of stocks and bonds, money has become a financial investment tool, which is called currency capitalization. The credit and capitalization of money is the initial form of virtual economy, which no longer corresponds to the real economy, but is the result of credit expansion, and has its own objective laws and internal requirements. At this time, the dual structure of real economy and virtual economy is formed, which is both interrelated and separated from each other.

Credit expansion is an inevitable requirement of modern economic development, and its benefits need not be said. However, we must clearly realize that credit expansion is a double-edged sword, which not only promotes economic development, but also contains great dangers. This is because in the process of credit expansion, the abuse of credit and all kinds of speculation in the credit market can easily lead to credit expansion, that is, the price in the credit market can no longer reflect the real business performance in economic operation, which is entirely the result of credit abuse and speculation. After World War II, great progress has been made in international capital flow and financial liberalization. These measures not only optimize the allocation of resources, but also aggravate the worldwide credit expansion, leading to the instability of the world economy.

Some facts illustrate the seriousness of the credit expansion. Judging from the amount of financial assets, the global stock market value and bond balance have reached $60 trillion at 1998, and the counter trading volume of derivative financial instruments has reached $80 trillion, far exceeding the real economy. Moreover, the growth rate of financial assets is 2-3 times higher than GNP in both developed and developing countries. Judging from the pattern of the world economy, the GNP of the United States only accounts for 25% of the world, but the US dollar accounts for 90% of foreign exchange transactions, and the stock value and bond balance of the United States account for 50% of the world, which shows that the position of the United States in the global financial market greatly exceeds that of its real economy in the world. Judging from the participants in the international financial market, the main body of the market is institutional investors, who pay more attention to short-term gains, which makes the trading activities in the financial market deviate from the real economy more and more.

The result of credit expansion is that the virtual economy is extremely unstable and fragile, which will have disastrous consequences for the real economy. Credit is based on people's expectation of future solvency, and this expectation is constantly strengthening. Credit inflation lacks the effective support of the real economy. If it is high, it will push up the price of financial assets. However, once people's expectations go wrong, it will cause a chain reaction of the credit chain, lead to the collapse of the entire credit system, and finally paralyze the real economy.

Specifically, the virtual economy will affect the real economy from the following aspects. First of all, the virtual economy has greatly increased the uncertainty and risk of the real economy. Enterprise management has to face the fluctuation of exchange rate, interest rate and stock price. With the development of virtual economy, fluctuations not only come from macroeconomic changes, but also are influenced by financial market speculation. Secondly, the false prosperity of virtual economy will cover up the imbalance between supply and demand and structural problems in the operation of real economy, mislead investors to expand investment and consumption, further stimulate the growth of virtual economy, and cause economic overheating and financial bubbles. Secondly, the dual market structure of real economy and virtual economy will cause two kinds of price signals. Under the dual price system, investors' pursuit of profit rationality will distort the allocation of resources and cause market failure; At the same time, the shift of inflation from commodity market to capital market may form hidden inflation. Thirdly, the deviation between the financial market and the real economy will induce speculative activities, reduce productive funds, and implicitly encourage institutional induction of distribution and inhibit production, forming a vicious circle of path dependence. Finally, the fact of the East Asian financial crisis also tells us that social stability and national economic security will be greatly damaged after the collapse of the virtual economy.