The monetary system of Hong Kong has experienced several reforms, now it can effectively control the money supply and restrain inflation. The reform of monetary system is very meaningful for China's Mainland, as C...The monetary system of Hong Kong has experienced several reforms, now it can effectively control the money supply and restrain inflation. The reform of monetary system is very meaningful for China's Mainland, as China's Mainland also wants to restrain inflation. The focus of this article is to analyze the process of monetary system＇s reform of Hong Kong, and the development of money supply system. The conclusion is that central bank of China's Mainland should learn from Hong Kong＇s experience and carry out more reasonable monetary reform.展开更多
The international dollar standard is malfunctioning. Near-zero US short-term interest rates launch massive hot money outflows into emerging markets （EM） in Asia and Latin America. Each EM central bank buys dollars t...The international dollar standard is malfunctioning. Near-zero US short-term interest rates launch massive hot money outflows into emerging markets （EM） in Asia and Latin America. Each EM central bank buys dollars to prevent its currency from appreciating but loses monetary control. Despite some appreciation, average inflation in EMs is now much higher than in the old industrial economies and world commodity prices are bid up sharply. This inflation on the dollar ＇s periphery only registers in the US CPI with a long lag. However, the more immediate effect of the Fed＇s zero interest rate is to upset the process of bank intermediation within the American economy. Bank credit continues to decline while employment languishes. Therefore, constructive international monetary reform calls for the Fed to abandon its zero-interest rate policy, which is best done in cooperation with the European Central Bank, the Bank of Japan, and the Bank of England also abandoning their ultra low interest rates.展开更多
The prevailing global financial system suffers from a shortage of good collateral for increased reliance on nonbank secured lending. Given that the global financial crisis was mainly triggered by the collapse of the c...The prevailing global financial system suffers from a shortage of good collateral for increased reliance on nonbank secured lending. Given that the global financial crisis was mainly triggered by the collapse of the collateral pool for dealer-based credit intermediation, this issue needs to be resolved quickly for normalized credit supply. Primarily, increased supply capacity for safe assets that can serve as valid collateral is the key agenda. This would be possible with a better use of USTs that are kept in EME silos and a broader recognition of an emerging market sovereign collateral pool. The inclusion of new collateral into the expanded and invigorated repo system that includes Asia would stabilize global capital flows and improve financial stability. In a related context, a market-driven, risk-mitigating regional repo market initiative would also bring balance to an increasingly market-driven financial ecosystem and mitigate the global shortage of safe assets.展开更多
文摘The monetary system of Hong Kong has experienced several reforms, now it can effectively control the money supply and restrain inflation. The reform of monetary system is very meaningful for China's Mainland, as China's Mainland also wants to restrain inflation. The focus of this article is to analyze the process of monetary system＇s reform of Hong Kong, and the development of money supply system. The conclusion is that central bank of China's Mainland should learn from Hong Kong＇s experience and carry out more reasonable monetary reform.
文摘The international dollar standard is malfunctioning. Near-zero US short-term interest rates launch massive hot money outflows into emerging markets （EM） in Asia and Latin America. Each EM central bank buys dollars to prevent its currency from appreciating but loses monetary control. Despite some appreciation, average inflation in EMs is now much higher than in the old industrial economies and world commodity prices are bid up sharply. This inflation on the dollar ＇s periphery only registers in the US CPI with a long lag. However, the more immediate effect of the Fed＇s zero interest rate is to upset the process of bank intermediation within the American economy. Bank credit continues to decline while employment languishes. Therefore, constructive international monetary reform calls for the Fed to abandon its zero-interest rate policy, which is best done in cooperation with the European Central Bank, the Bank of Japan, and the Bank of England also abandoning their ultra low interest rates.
文摘The prevailing global financial system suffers from a shortage of good collateral for increased reliance on nonbank secured lending. Given that the global financial crisis was mainly triggered by the collapse of the collateral pool for dealer-based credit intermediation, this issue needs to be resolved quickly for normalized credit supply. Primarily, increased supply capacity for safe assets that can serve as valid collateral is the key agenda. This would be possible with a better use of USTs that are kept in EME silos and a broader recognition of an emerging market sovereign collateral pool. The inclusion of new collateral into the expanded and invigorated repo system that includes Asia would stabilize global capital flows and improve financial stability. In a related context, a market-driven, risk-mitigating regional repo market initiative would also bring balance to an increasingly market-driven financial ecosystem and mitigate the global shortage of safe assets.
