Excess liquidity of money means that the amount of money far exceeds the demand for money, and too much money pursues less goods. At the same time, in the situation of the sharp increase in the amount of money, monetary funds are bound to be divorced from the actual production system, frantically operating goods and pursuing high profits. For the financial market, liquidity has a broader meaning: for the central bank, it refers to the issuance of "base currency" and the management of market liquidity, and excess liquidity refers to the excessive issuance of base currency, which exceeds the carrying capacity of the real economy; For commercial banks, it means loan-to-deposit ratio. If deposits are far greater than loans, there is excess liquidity. For enterprises and investors, liquidity refers to the liquidity of book assets, and all assets that are easy to realize are current assets. The so-called excess liquidity usually refers to the excess of realizable assets-the central bank's interest rate hike to deal with inflation is only a stopgap measure, which can slow down inflation in a short time. Can't fundamentally solve the problem. China's dual economy is different from that of foreign countries. Raising interest rates will increase the inflow of hot money and worsen inflation. An interesting example is that in the case of inflation, PetroChina leads the trend of price increase, but the National Development and Reform Commission also talks about private enterprises such as Master Kong Cleaning to delay the price increase-where has all our money gone? The peak of CPI this year may be close to 6%, which has far exceeded the bottom line of 3.3% serious inflation. Moreover, this is only the data released by the Bureau of Statistics. I think the actual inflation should be at least close to 20%, so even if you increase 10%, the interest rate will still be negative. It is predicted that raising interest rates will lead to the reallocation of some savings-on the contrary, it will strengthen inflation. Private enterprises can't borrow money, which leads to the continuous expansion of capital transfer. Tight monetary policy only enhances investment in state-owned enterprises and central enterprises. High-speed rail leaps forward, and the central bank issues 22.7 trillion yuan. Not to mention the financial difficulties of the country are issuing more money. Bernanke's comments on China's interest rate hike to fight inflation are surprising. Private enterprises earn foreign exchange, and Morgan Stanley invested by CIC loses money every year. . . . . . All the puzzles in the world, as long as you want to be in China, don't have to figure it out-the nature of the country determines it. Our government is always calling for fighting poison with poison. In my opinion, to solve the inflation problem in China, we must start with the following points: 1. Slow down infrastructure construction. In particular, reduce investment in high-speed rail. 2. Increase preferential treatment for private enterprises and realize three-year tax exemption for private enterprises. Think about how much employment rate you will absorb (I said that 72% of the 654.38 trillion tax revenue comes from private enterprises and small and medium-sized individuals, and private enterprises bear more than 80% of the domestic labor employment. Under the condition of raising interest rates and RMB appreciation, private enterprises have suffered great setbacks, leading to the break of capital chain. ) 3. Increase taxes on state-owned enterprises and reduce overseas investment (state-owned enterprises-enterprises of all ordinary people in China. Now it's completely stale and has become the money bag of interest groups. According to statistics, CIC wastes hundreds of billions overseas every year. Who will pay for all this? Foreign losses and large-scale printing of money at home have led to inflation. ) or realize the public shareholding reform of state-owned enterprises and central enterprises. -Let me answer your question directly.

Why can the central bank raise interest rates to deal with inflation? -under the condition of raising interest rates, the loan interest rate rises, enterprises can't get money, exports are frustrated, goods are sold domestically, and prices naturally fall. That's all, but the source of inflation is very complicated when the government and economic conditions in China are not mature.

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