Where Has China'S Money Gone? The Masses Are Asking.

Where is China's money? Many private enterprises are asking.

These small and medium enterprises which account for more than 90% of the national enterprises, accounting for GDP60%, and 80% of the total urban employment, are facing tight funds, and only get 10% of the bank loans.

China's money is hard to get rid of and is difficult to get into reality. There has been an unprecedented congestion, forming numerous "dammed lakes" of different sizes.

Extra money has created five major difficulties in China.

Where is China's money? Hundreds of millions of investors are asking.

Since 2016, the daily turnover of Shanghai and Shenzhen two cities has been hovering around 500 billion. Compared with 2015, it only accounts for 1/5, and the daily volume of Shanghai stock market has shrunk to 1/8.

As a matter of fact, national income accounts for GDP50 - 60%, and national revenue accounts for about GDP40%, forming a complete cake. However, the total amount of GDP in China is far from equal to that of national income and fiscal revenue, and a large number of GDP gross value has disappeared.

Although the wages of ordinary people have increased, but as long as they see a doctor, children go to school, money is tight.

From 2000 to 2015, the M2 data show that inflation has increased 10 times in 15 years, especially from 2008 to 2015, which has exceeded 1.813 times that of the United States.

From China's comparison with the M2 data of the world's four largest economies, China's currency can buy the entire US and more than half of the EU, and by the end of 2016, it can buy the whole US and the whole EU.

If M2 growth is always around 13%, China can buy the whole world in less than 10 years.

This is not a joke, not an ambitious topic, but a problem that can not be ignored. A very realistic question, a puzzling question, is a cruel question.

Because China and the world are facing a problem of liquidity trap.

The first is the dilemmas of the scissors difference between M2 and GDP.

In 2014, M2 grew by 12.2%, GDP increased by 7.3%; M2 increased by 13.3% in 2015, and GDP increased by 6.9%; in 2016 February, the growth of M2 increased by 13.3% and GDP increased by 6.5%, especially in the October from October last year, and the growth rate increased to 24.6% from June this year.

This shows that corporate deposits have increased substantially, but they are reluctant to invest in new capacity expansion.

Meanwhile, personal investment has also shrunk dramatically, from 20% in 2014 to 2.8%.

This shows that money supply has been difficult to drive the economy.

Followed by the massive issuance of money and the huge increase in debt.

The dynamic rise of M2/GDP indicates that China's efficiency of capital use has declined, funds have been precipitated in inefficient sectors, and the enterprises that rely on debt to survive have generated a large number of excess capacity, resulting in debt accumulation.

According to statistics, the debt of Chinese enterprises has accounted for 1.9 times of GDP, and local government debt has accounted for 50% of GDP, reaching more than 30 trillion.

Bank of China's non-performing loans have reached about 15%, accompanied by a continuous default on corporate debt.

Third, the credit dilemma between central enterprises and private enterprises.

Loose state

For central enterprises, because of the bank's protection of their reputation, low interest credit continues to provide support, which is why M1 is rising.

However, the central enterprises think that the old products are overcapacity and new products are not profitable, so they deposit the credit funds in the finance company as short-term financial investments.

While private enterprises bear the burden of the national economy, banks are reluctant to release credit because of their low credibility. Therefore, private enterprises can no longer abandon new orders.

The fourth is the plight of the strong housing market and the weak stock market.

Debt market maintained by the housing market

The expansion - pushing up the price of land - pushing up house prices, China's asset prices are concentrated on housing prices.

The rise in house prices has become the fundamentals of asset prices. In 2015, the real estate market increased by 200 trillion of the market value, while the stock market's total market capitalization was only 50 trillion.

Fifthly, the gap between the rich and the poor is widening.

In the context of slower economic growth and rising housing prices, the high net worth population (US $1 million) has 6 million RMB assets, up to 1 million 340 thousand in May 2016, an increase of 130 thousand over last year, and 89 thousand of the high net worth population, an increase of 11 thousand over last year.

Guangdong, Beijing, Shanghai, Zhejiang and four provinces and municipalities have tens of millions of assets of high net worth of 843 thousand people, accounting for 63% of the country.

It is worth mentioning that according to a survey of household income of urban and rural households, China's gray income is 6 trillion and 200 billion, which accounts for about 12% of GDP.

From the data analysis, it is found that the grey income is spreading to the middle and high income class, and the corruption problem also arises. This shows that the unfair distribution of income has caused the plight of the gap between the rich and the poor.

All this shows that money is a problem.

Relying on monetary easing and excessive currency growth to push the economy out of effect.

There is a problem in the circulation of money. There is no benefit in the rich place, and there is no money in the area where money can be generated.

With more money and more debts, it is hard to push more money.

With more money, there is a serious shortage of assets. Instead of being short of money, the money is more money than money.

A hundred dollar bill or a hundred dollar bill, but a hundred dollar bill is not worth hundreds of dollars.

As the currency effect declines, the credit for money is also declining.

The money left the real economy and entered the real estate bubble. Under the colorful real estate bubble, the dream of money crushed the confidence of entrepreneurs and disrupt the mentality of industrial workers.

No one knows where the money goes, nor is it easy to attract anyone. People seem to no longer pursue the effect of money, but more on the loss of money and the preservation of money.

The assets of the stock market have not appreciated in 2016, and the value of the stock is already on the top.

Looking at May, June and July, the market is running at 3000 points.

Fourth quarter, how long as the housing market is still strong, the stock market will be hard to get rid of the weak.

At the 3000 point, the bottom up is to see how each investor controls money.

Where the money goes, you can ignore it, but you must understand your money wherever you go.

How much money should be invested, how much and how long it takes to invest in the stock market is also faced with the "liquidity trap" and liquidity opportunities.