Contain the risk of virtual currency

Recently, the most concerned keywords in the field of Finance and economics are "risk prevention" and "help entities". Bitcoin and other so-called "virtual currency" hazards and risks continue to appear, leading to regulatory heavy fists“ At the "2017 Financial Street Forum", the relevant responsible persons of the "one party, three meetings" released an important signal around financial reform and development, that finance should take serving the real economy as its bounden ty to prevent the transition from the real to the virtual

Finance is the blood of the real economy. Serving the real economy is the bounden ty of finance, the purpose of finance, and the fundamental measure to prevent financial risks. Financial innovation should serve the real economy and meet the regulatory requirements. It is necessary to crack down on those fake financial innovation behaviors or even illegal financial behaviors in the guise of "innovation"

Due to the different national conditions, political, economic and external environment, the methods and means to deal with the crisis are quite different. However, the outbreak of currency crisis under economic globalization has obvious commonness, and the outstanding performance is "infectivity". Therefore, some effective measures to deal with the crisis have important reference significance for other countries
(1) control of capital outflow
when there is a rapid and large-scale capital outflow, one is that the government unilaterally declares to control the capital outflow. Japan, a big developed financial country, has passed legislation to stipulate the power of relevant departments to regulate capital transactions in case of extraordinary circumstances (including the difficulty in maintaining the balance of payments, the sharp fluctuation of yen exchange rate, and the adverse impact of capital movement on finance or capital market). Although the relevant laws have been revised several times, the general principle of "extraordinary circumstances" is still retained. The economic and academic circles support Malaysia's decision to control capital outflow ring the crisis, but believe that the long-term adverse consequences of the measures to control capital outflow are greater than the short-term benefits, because it will encourage domestic tax evasion and capital flight, and combat the enthusiasm of foreign investors. Second, IMF and other international organizations should mediate and announce "debt freeze" to prevent creditors (international banks and investors) from withdrawing their capital unilaterally; Establish a mechanism that enables creditors and debtors to share losses in an appropriate way< (2) local currency control
for example, in order to prevent international speculators from attacking the Malaysian currency ringgit, the Malaysian government announced the foreign exchange control on September 1, 1998: the exchange of ringgit by foreigners and the transfer of funds between foreign accounts must be approved by the central bank; All transactions of financial assets can only be concted through authorized savings institutions; Foreign funds need to hold shares in the stock market for one year before they can cash their shares out of the country. Since ringgit can not be traded abroad, speculators can not accumulate a huge amount of ringgit, so Malaysia is free from speculative attacks. Monetary control measures not only curbed the outflow of ringgit, but also made a large amount of capital flow back in the short term, prevented the external financial storm from spreading to the domestic economy, stabilized the exchange rate of ringgit and domestic consumer prices, and created an environment concive to economic recovery
(3) rapid financial adjustment and strong financial supervision
in 1999, in order to quell the financial turmoil, the Brazilian government first raised the bank interest rate to prevent the massive outflow of funds and stabilize the financial market. When the market is relatively stable, the interest rate will be lowered in time to rece the impact on enterprises. We will investigate financial institutions and enterprises that participate in stock market speculation and violate regulations in the financial turmoil, and impose economic sanctions on those financial institutions and enterprises that are found to have violated regulations. The central bank also announced a series of measures to strengthen the management of the financial market, stipulating that no bank or enterprise shall jointly operate or trade investment funds, no bank shall guarantee the funds managed by itself, and no financial institution shall guarantee its business with bonds issued by itself, All banks and financial institutions are required to report to the central bank on the implementation of the above provisions on a quarterly basis. Strengthen the supervision of foreign exchange transactions, make the transactions transparent, and limit the time and quantity of foreign exchange transactions. The implementation of these measures has effectively cracked down on the illegal acts of financial institutions and played a great role in stabilizing the financial market< (4) timely and one-step currency adjustment
judging from the currency crisis so far, few monetary authorities have won a complete victory in the competition with market speculation. Even a few victories (such as Hong Kong in the East Asian financial crisis) have paid a heavy price. Therefore, once the currency crisis breaks out, the rational choice is: timely and one-step currency adjustment. The Southeast Asian crisis has devalued the currencies of relevant countries (regions) by 15% - 30% in three months. This shows that: first, even with sufficient reserves (Mexico had $30 billion in 1994), it is futile to try to stabilize the financial market without devaluing the currency; Second, it is necessary to devalue immediately, rather than graally, to avoid wasting foreign exchange reserves< (5) to prevent the chain failure of commercial banks
in order to prevent the malignant crisis of chain failure of banks, Mexico has taken the following countermeasures: the government requires commercial banks to increase the reserve ratio for bad debts and enhance their own "disaster resistance" ability. The central bank provides a certain amount of foreign exchange and local currency to commercial banks to ensure their minimum payment ability, especially to maintain their ability to repay foreign debts, so as to prevent a bank from causing a greater financial crisis and causing a larger scale of capital flight e to its inability to repay foreign debts on time; Invest funds to support enterprises to reschele their debts, mainly those owed to banks, so as to avoid bank crisis caused by bad debts; Intervene the commercial banks that are going to close down in time, take over directly by the Ministry of Finance and the central bank when necessary, and prohibit depositors from settling the run in advance; Establish and perfect the bank deposit protection fund, which is a semi official institution to provide risk protection for commercial banks; We should limit commercial banks' overdraft from the central bank, encourage commercial banks to expand domestic savings, rece their dependence on foreign capital, and rece external risks< In order to strictly control the government's expenditure and rece the fiscal deficit, after the currency crisis, the Brazilian government announced to cut the federal government's expenditure, suspend the recruitment and rection of public servants, suspend the promotion and promotion of all national civil servants, and suspend the increase of civil servants' wages and other funds; Strict control of public sector procurement. Brazil's central budget deficit is mainly caused by adjusting taxes to increase revenue and excessive social welfare expenditure. The Congress passed a bill to reform the welfare system and increase taxes, raising the rate of welfare tax on serving and retired public officials; A welfare tax will be imposed on servicemen to rece government spending on social welfare. At the same time, the central bank also decided to lower the financial operation tax rate imposed on foreign capital in order to attract foreign capital< (7) strive for the understanding and support of the domestic people
currency crisis usually reflects the confidence crisis of foreign investors and the domestic people. It is very necessary to stabilize the confidence of foreign investors, especially strive for the understanding and support of the domestic people for the anti crisis policy, so as to effectively alleviate and overcome the crisis. For example, after the Southeast Asian financial crisis spread to South Korea, South Korea's officials and people were united as one. Officials and people enthusiastically donated gold, silver, jewelry and foreign exchange to the country and offered suggestions and suggestions, which played an extremely important role in quickly stabilizing the economic situation, getting rid of the crisis and restoring the economy of South Korea< (8) necessary administrative control
administrative control is certainly not the best choice, but at the critical moment of worsening crisis, the necessity of administrative control is beyond doubt. Inflation is an important result and manifestation of the currency crisis. To stabilize people's minds and political situation, it is necessary to stabilize prices. Therefore, the government should control the rise of prices and wages at an appropriate time, crack down on hoarding, regulate the increase of prices of goods and services that directly affect people's lives, and provide some foreign exchange to stabilize prices, We should take severe measures to crack down on malicious speculation that interferes with market order, including financial market order. Although administrative regulation can quickly stabilize social order, it will damage the market operation mechanism< (9) the rapid start of regional cooperation mechanism
in order to effectively deal with the occurrence and spread of the currency crisis, the relevant regional and bilateral cooperation and coordination mechanism should be started quickly. The European Economic and Monetary Union and the North American Free Trade Area have fully demonstrated from both positive and negative aspects that regional cooperation can obtain financial support in time to prevent the decline of trust and stabilize market turbulence, which is more effective than international cooperation or accepting IMF rescue. After the painful lessons of the financial crisis, East Asian countries are increasingly close to each other's economic and financial cooperation, including strengthening negotiations between central banks and currency swap agreements, which will significantly enhance the region's ability to prevent and deal with currency crises in the future