Overview of banking qualification laws and regulations: financial basis
Overview: Financial Basis
(1) Grasp the essence of money, the influencing factors of money supply and demand, and the basic contents of inflation and deflation;
(two) to master the content, objectives, principles and transmission mechanism of monetary policy;
(3) Grasp the contents of interest and interest rate, and the process of interest rate marketization in China;
(4) Grasp the basic contents of foreign exchange and exchange rate, the factors affecting exchange rate changes and the process of RMB internationalization.
First, the nature and function of money
(A) the origin and evolution of money
Money is produced with the development of commodity economy, and it is the product of commodity production and commodity exchange development.
In the process of commodity exchange, the value of a commodity is expressed by other commodities with the same value, which is the form of value expression, referred to as value form. In the process of exchange and development, the form of commodity value expression has gone through four stages: simple value form, expanded value form, general value form and monetary value form, and finally money has come into being.
Section 1 Basic knowledge of money
Money is a special commodity separated from the commodity world and fixed as the medium of commodity exchange with the development of commodity exchange after the emergence of commodity exchange.
The materials and forms of money have experienced a continuous development process, mainly including physical money, metal money, credit money (including convertible credit money and non-negotiable credit money) and electronic money.
(B) the nature of money
The essence of money is that money is a universal equivalent, a special commodity fixed as a universal equivalent, reflecting the social relationship between commodity producers.
1. Money is a special commodity, which always acts as a universal equivalent.
The particularity of money is as follows: money is a substance to measure the value of all commodities; Ability to exchange with all other commodities.
2. Money embodies certain social relations of production.
(C) the function of money
The function of money is the concrete embodiment of the essence of money. In the process of exchange and development with commodities, money has gradually formed functions such as value scale, circulation means, storage means and payment means.
1. Value scale
Money plays a role as a measure of value when expressing and measuring the value of goods. Money, as a measure of value, represents the value of all commodities as the quantity with the same name, making the quality of commodities the same and the quantity comparable.
The characteristics of monetary execution value scale: it can be ideological currency.
2. Means of circulation
In commodity exchange, when money is used as a medium of exchange to realize the value of commodities, it performs the function of circulation means. The characteristics of currency execution circulation are: first, it must be real currency. Second, there is no need to have a full value, and symbols can be used instead.
3. Storage device
When money temporarily withdraws from circulation and remains in a static state as an independent value form and social wealth, it performs the function of storage means.
The characteristics of currency execution and storage are: first, it must be realistic and sufficient currency. Second, it must be static to exit the circulation field.
4. Payment instruments
When realizing the unilateral transfer of value, money performs the functions of means of payment, such as repayment of arrears, payment of taxes, bank lending, payment of wages, donations and gifts.
The positive effects are as follows: first, the production and circulation of commodities have broken through the restrictions of spot trading and promoted the development of commodity production and circulation. Second, by means of monetary payment, some creditor's rights and debts can offset each other, which can save cash circulation costs.
The negative effects are as follows: forming complex creditor-debtor relationship among commodity producers, expanding the contradiction of commodity economy, and possibly causing payment crisis and credit crisis.
Second, money demand and money supply.
(A) the demand for money and its influencing factors
1. The meaning of money demand
Money demand refers to the need of all social strata (individuals, enterprises and governments) to hold property in the form of money in a certain period of time, or the money demand of all social strata for means of circulation, payment and storage.
2. The main factors affecting the demand for money
(1) Income level
The demand for money is in direct proportion to the income level.
(2) Interest rate level
Interest rate is inversely proportional to money demand.
This is because: interest income can be regarded as the opportunity cost of holding money, and rising interest rate means an increase in the opportunity cost of holding money (interest income given up because of holding money), which will lead to a decrease in the amount of money held, so the demand for money tends to decrease. On the contrary, the interest rate decreases, the opportunity cost of holding money decreases, and the demand for money tends to increase.
(3) Availability of social goods, price level and currency circulation speed.
If m represents the demand for money, p represents the price level, q represents the availability of social goods, and v represents the speed of money circulation, there are the following formulas according to the law of money circulation: M = PQ/V shows that the price level and the availability of social goods are directly proportional to the demand for money; The speed of money circulation is inversely proportional to the demand for money.
(4) the degree of development of the credit system
The development of credit monetary system is inversely proportional to the demand for money.
When the credit system is developed, on the one hand, the amount of money as a means of circulation payment can be reduced through payment settlement, thus reducing the demand for money. On the other hand, the development of the credit system is conducive to improving the financial market, increasing the forms of assets available for people to choose, giving people more choices in asset allocation and reducing the wealth held in the form of money.
(6) public expectations and preferences
When people expect the price level to rise and the currency to depreciate, they will reduce the amount of money held and the demand for money will decrease. If people prefer money, the demand for money will increase; if people prefer other financial assets, the demand for money will decrease.
(7) Other factors
Population, population density, economic structure, social division of labor, transportation and communication and other technical conditions.
(b) Money supply and currency class
1. The meaning of money supply
Money supply refers to the amount of money that a country serves the social and economic operation at a certain point in time. Generally speaking, it consists of cash currency and deposit currency provided by the central bank and commercial banks.
Money supply is a concept of stock.
The public's willingness to hold cash, the cash demand of various social sectors, the social demand for credit funds, fiscal revenue and expenditure and other factors will affect the total money supply.
2. The hierarchy of money supply
M0= cash in circulation;
M 1=M0+ corporate demand deposits+rural deposits+deposits of institutions, organizations and troops+personal RMB demand savings deposits under bank cards (narrow currency, which is real purchasing power);
M2=M 1+ savings deposits of urban and rural residents+fixed deposits of enterprises+margin deposits of securities companies+other deposits.
Broad money usually reflects the change of total social demand and the pressure of future inflation, which is generally called money supply.
(M2-M 1) is called quasi-currency, which is the potential purchasing power.
(C) the process of creating deposit currency and its influencing factors
1. Creation process of deposit currency
Deposit reserve (rd) refers to the funds prepared by commercial banks to ensure customers' withdrawal of deposits and settlement of funds.
Derivative deposits: deposits generated by banks' loans, discounts and investments through transfer.
Money creation process: Commercial banks create credit money by creating derivative deposits in their assets and liabilities business.
Original deposit is the foundation of derivative deposit creation, and derivative deposit is the condition of credit expansion.
2. Currency multiplier and its influencing factors
Money multiplier, also known as money expansion coefficient or money expansion multiplier, refers to the credit expansion multiple of money supply obtained by commercial banks by creating derivative deposits on the basis of base money (high-energy money), which is the multiple of money supply expansion. The size of the money multiplier determines the expansion ability of the money supply of commercial banks.