The global financial crisis subversion of the excessive flood
The global financial crisis subversion of the excessive flood of financial innovation mode. Finance is the essence of the spread of credit, financial innovation leads to credit abuse. Under the banner of financial innovation in financial derivatives, overflowing with economic ontology happen McLoughlin of unimaginable significant deviation. Innovative dividend taken away, the risk of innovation are for the market. Excessive JinRongHua, excessive securitisation, excessive globalization planted to the social Mbt shoes economy, one can not give up cancer, finally come out clean up the mess is the government and taxpayers but only. The subprime crisis not only led to the destruction of the us investment bank even Wall Street, also gave the world financial ecological environment brought to repair major disaster, this disaster is not only the most direct American, and shall be the whole world.
The global financial crisis subversion of the excessive relaxation market supervision mode. In free markets and free financial “the Washington consensus”, the United States government in the 1980s – after 1990s greatly relaxed of financial enterprises and supervision of financial markets and financial institution itself natural exists to avoid regulation the motivation and means, these two factors and the fed cut interest rates lead to interest rates for 27 times of the whole society to sharply flood and find liquidity funds way factors together, make the subprime products, and other financial innovation has an inner motivation and source and formed cannot consider also cannot control systemic risk source. It is due to the lack of government regulation system and loopholes, makes the MBT sale whole Wall Street at the state, in addition to innovation flooding designer himself, other participants actually have not accurately grasp the risk of product of market and the risk. So, shrouded in financial illusion the essence of the financial innovation with others became let others for their money to pay of the process, credit relations also in this process evolved for credit trap. The subprime crisis occurs, the whole world is underestimated the subprime crisis, the huge risks implied that eventually reached a human’s worst ever century-old financial tsunami and caused wooed the century-old economic holocaust before.
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