RMB with the International Monetary conditions

Fed likely to commit the same mistakes of the past and

 Financial and Economic Committee, deputy director of the National People's Congress, the former central bank vice governor Wu Xiaoling said the other day, the United States is currently adopted in a row to cut interest rates to stimulate economic growth, which could mean the Fed is guilty of the same mistakes in the past.  Prior to that, in the industry are generally of the view that the U.S. financial crisis, monetary policy is in fact a big problem, that is, the long-term policy of low interest rates led to today's evil.

 Wu Xiaoling of the Central University of Finance and Economics pointed out that the talks on the second loan crisis, even if inflationary pressures are still very big, but the central banks to cut interest rates in a row, and a large number of injecting liquidity, with the goal of suppressing money market interest rates, because of all derivatives of breach of contract Are caused by rising interest rates.  Only by lowering interest rates in order to reduce the probability of default.

 After a substantial cut in a row, the U.S. federal funds rate has been reduced to 1%.  According to Federal Reserve Chairman Ben Bernanke's words a few days ago, the United States may cut interest rates further.

 Wu pointed out that Japan had long-standing zero interest rate policy, and a large number of injecting liquidity to the market, resulting in a large number of international markets, the yen carry trade.  This shows that if a country's interest rates low enough, in the free flow of international capital conditions, may encourage a large number of disorderly flow of arbitrage funds.

 Turning to sub-loan crisis on China, Wu Xiaoling of the view that Chinese-funded financial institutions subject to the direct impact.  Although Chinese-funded banks and foreign exchange reserves held by the two Housing bonds are 370,000,000,000 U.S. dollars, but is not expected to be much damage, the Housing because of the two bonds have the implicit U.S. government guarantee, while the United States will not lose the trust of the rash.

 She also pointed out that although the U.S. economy is a very serious crisis, but the U.S. Treasury but it also keeps interest rates lower, indicating the countries outside the huge reservoir is no place to go, China's foreign reserve is also facing the risk of shrinking, but still can not find the second alternative U.S. Currency, the irrational international financial and monetary system in the world is destined to be one of the U.S. bullying.

 Wu Xiaoling of the view that the yuan should be allowed to speed up an international reserve currency, the yuan fully with the conditions.  She also said that the need to intensify reform efforts to improve China's industrial products in the world chain, at the same time to gradually let the yuan as an international clearing currency, the renminbi financial markets to expand the breadth and depth and speed up the process of convertibility of RMB, the yuan to hold There are those who create channels for investment.

 At the same time, said Wu Xiaoling, China's foreign currency reserve structure, there are about 20 multi-currency, the dollar is the main.  She also frankly, things are really hot money in reserve, but the scale of hot money can not be calculated.

 Turning to the current financial tsunami to China, Wu Xiaoling of the view that the U.S. can not derivatives resulted in a crisis, China will no longer finance the development of innovative products, the key is to leverage control and establish a scientific mechanism for the stop-loss.

 She also reiterated that China's current economic situation has not ignored the situation of negative interest rates continue to lower interest rates.  Interest rate policy is also used in the future, bearing in mind the interest rate differential at home and abroad.  Uncertainty of the situation in the foreign exchange flow, first by reducing the central issue tickets to the release of liquidity, and then only by lowering the deposit reserve ratio.