Events: Li Thunder: to 15% next year M2 growth rate is moderate
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Yesterday, the chief economist at Guotai Junan Li Thunder 2011 in a long letter to fund high-end macro-economic and investment strategies on the Forum pointed out: China economy to sustainable growth over the past decade such a high growth rate of M2 is not sustainable, next decade annual growth rate of M2 should be down, stays at about 10% to 12% level, the inflation rate remained at 3% to 4% level, which is an ideal state.
M2 growth target for next year, Li Thunder forecast may be 15%.
Lee Thunder on the "First Financial Daily" correspondent, said, M2 growth rate of the callback will not have a significant impact on liquidity. The same effect for the stock market should also be neutral. "After all, the total funds of 70 trillion yuan, is very large; M2 growth rate adjustment can only be changed incrementally. Will maintain ample liquidity and I think next year M2 growth rate adjusted to 15%, this level is moderate . "
M2 will become the future size of the control problem
Thunder Lee said that in the future in China's economy continues to grow, M2 scale control will be a problem.
"If China's GDP over the past 30 years, called the economic miracle of high growth, then far greater than the GDP growth rate of M2 but keeping inflation low, even a miracle. Compared to Japan, South Korea's rapid economic growth of M2 growth phase speed of the two countries, the average annual growth rate of M2 were 20% (1967 - 1973) and 34% (1966 ~ 1988), significantly higher than China's current level, but the CPI increase over the same period is very high, such as Japan CPI in the 1970s to 9 percent annually.
M2 China's current total of 70 trillion yuan, while the United States M2 8.6 trillion dollars, amounting to only 58 trillion yuan, but China's GDP is only the size of the United States, 1 / 3.
If the comparison between China and the M2-GDP ratio will be found in the past 20 years, data for China rose substantially from 65% in 1986 to nearly 200% in 2010, but little change in the United States, remained at 60% level.
South Korea 2009, M2-GDP ratio of 147%, 159% in Japan, but also in Japan and South Korea's high economic growth period, the proportion of M2/GDP only 100 percent. This means that in the future in China's economy continues to grow, M2 size will be difficult to control.
Thunder Li said that China's M2 growth rate much higher than GDP growth, average growth rate over the past decade, more than 18%, while the average CPI level over the past decade, only about 1.8 per cent and monetary theory, "M2 growth rate = GDP growth rate + CPI "a serious departure.
Why M2 growth over the past decade
"M2 extraordinary growth for many reasons, can not be simply attributed to the central bank." Thunder in the forum, Lee said, the extraordinary growth of China's M2 four main reasons: First, the increasing foreign exchange, the second is the size of credit increased rapidly, three as_set_ prices rise, the four lower financial leverage.
Li Thunder had in its recent report detailing the above four reasons. Are: first, a huge foreign exchange is well known that led to rising M2 reasons, China's foreign exchange reserves reached $ 2.4 trillion, accounting for 27 percent of M2, and from the perspective of the new year, the foreign exchange main contribution embodied in the 2004 to 2008, during which its new M2 accounted for about 50% the proportion of the trade balance continues to expand and hot money inflow is the main reason.
Second, China's economic growth presents significant investment-led features, the size of the rapid growth of credit, the average annual growth of 15.6% over the past decade, credit derived deposits, corporate profits surged by new deposits, government revenue and land auction revenue, but also led to the rise in new deposits, domestic alternative to foreign demand as the main driving force of economic, credit will become the main source of liquidity creation.
Third, the real estate-based as_set_ prices rise, urban and rural residents reported current domestic total market value of homes has reached 90 trillion yuan, up more than five times a decade ago, and, most real estate transactions are not mortgage loans by banks, so real estate prices soared on the M2-scale expansion of a turnout.
Fourth, from the perspective of the financial leverage of China's loan to deposit ratio is lower than South Korea and Japan, 66%, while South Korea to more than 100%; U.S. investment bank's leverage ratio higher, subprime mortgage crisis are more than 20 times, corresponding to only 1.5 times of China's brokerages.
M2 growth over the next decade is not sustainable
"Although the scale of China's M2 is now big enough, but to see its growth rate is still the future continue to expand on the M2 has a strong driving force."
According to Li Thunder estimates, "If by regulators has always been the target of 17% growth rate estimates, the next decade China's M2 is the total will reach 340 trillion yuan; if it is 15%, will reach 282 trillion yuan.
This means that the size of the currency-GDP ratio may reach more than 3 times. This will bring a series of hidden risks, such as the risk of hyperinflation, the risk of as_set_ bubbles burst, or the RMB freely convertible in the context of the devaluation pressure.
South Korea in 1966 to 22 years in 1988, M2 annual growth rate as high as 34% even before the Asian financial crisis five years, still as high as 19%, resulting in the 1997 Asian financial crisis and the 2008 U.S. sub- After these two crisis mortgage crisis, have both been won devaluation phenomenon, although still far lower than South Korea's M2/GDP China.
How will the Chinese economy is difficult to answer, but if you want sustainable economic growth over the past decade such a high growth rate of M2 is not sustainable. Japan and South Korea experienced high growth rate in M2 growth, also declined in Japan in 1980 to 1990 the average growth rate of M2 was 9.3%; South Korea from 1992 to 1997 the average was 19.6% in 1997 to 2002 an average of 11%.
Author: Wang Qiong (Source: Business News)
(Editor: Cao All) |
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