Vice Chairman of China Banking and Insurance Regulatory Commission: Unlimited quantitative easing in major developed economies may cause serious sequelae
China News Service, Beijing, September 4 (Reporter Wang Enbo) Zhou Liang, vice chairman of the China Banking and Insurance Regulatory Commission, reminded at the 2021 Trade in Services Conference on the 4th that various signs indicate that major developed economies implement unlimited quantitative easing policies that distort capital prices and exacerbate resource misallocation. , Which encourages market speculation and de-realization to virtuality, which is likely to leave serious sequelae.
As the main forum activity of the 2021 Service Trade Fair Financial Services Special Exhibition, the 2021 China International Finance Annual Forum will be held in Beijing on the same day.
Zhou Liang pointed out at the meeting that current global inflationary pressures are increasing. Since the beginning of this year, more than 80% of economies’ inflation levels have risen, and the global core inflation rate has shown its highest level in many years. The commodity market fluctuates sharply; some countries have heavy debt burdens. At the end of the first quarter, the global debt balance reached approximately US$289 trillion, equivalent to 360% of global GDP, a record high.
Regarding the implementation of unlimited quantitative easing policies by major developed economies, he bluntly stated that although unconventional stimulus policies have a temporary effect on alleviating the crisis in the short term, it is difficult to solve deep-seated structural problems.
"As the saying goes, when the tide rises and the boat rises, there will be a clear end." Zhou Liang believes that as the macroeconomic policies of major developed economies turn to expectations, some countries are facing multiple pressures such as capital outflows, currency devaluations, and increased inflation, and financial vulnerabilities have risen.
Under the current situation, all countries in the world should strengthen coordination and cooperation, jointly maintain the stability of the international market, and promote the healthy and sustainable recovery of the global economy.
Talking about how to prevent and control financial risks, Zhou Liang said that China will do a good job in cross-cyclical adjustment of macroeconomic policies, maintain the continuity, stability and sustainability of macroeconomic policies, resolutely refrain from flooding, and strive to unblock the monetary and credit transmission mechanism. The leverage ratio was basically stable, and the growth rate of money and credit remained at a reasonable level.
In addition, risks in some key areas have also been resolved in an orderly manner.
He revealed that in the past four years, China’s banking industry has disposed of a total of 8.8 trillion yuan of non-performing loans (RMB, the same below), surpassing the total of the previous 12 years. High-risk shadow banking has dropped by 23 trillion yuan from its historical peak. Small and medium financial institutions have been reformed and reorganized. Steady progress has been made, financial crimes have been severely punished, and market order has improved significantly.
The robustness of the financial system has improved significantly.
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