China is not the chief culprit of the financial crisis.

Mr. Lin Yifu believes that the root cause of global imbalance is that developed countries were not prepared for the international financial crisis at that time and the measures taken were not in place.

As we all know, before the global financial crisis broke out, the balance of payments had been in an unbalanced state. The trade deficit of the United States has increased sharply, and the trade surplus with China and foreign exchange reserves have increased sharply. At that time, there was a very popular saying in the world that the cause of this crisis was that some countries in East Asia accumulated a large amount of foreign exchange reserves through trade surpluses, and then used these reserves to buy US Treasury bonds, which led to the real estate bubble and the bursting of the bubble, which led to the global financial crisis in 2008.

Lin Yifu believes that China is not the chief culprit of the financial crisis for three reasons.

In 1960s, the East Asian economy adopted the export-oriented growth strategy, which has been implemented for more than half a century.

If the international trade imbalance is the result of "self-protection" caused by the accumulation of foreign exchange in East Asian economies, we cannot explain the situation in Japan and Germany. He thinks this theory is also unconvincing.

He thinks it's even weirder to accuse China. If China underestimates the RMB, improves its export competitiveness and earns more foreign exchange, then China should reduce its trade surplus and foreign exchange in the competition with other developing countries. But what we see is not only that China's trade surplus is increasing, which is inconsistent with the empirical facts.

The conclusion hopes that the subject can read more economic books and understand the views of some economists. I think most of Mr. Lin Yifu's economic theories are worth learning.