Is #shadowbanking stigmatized in China? Maybe a more active, positive and supportive approach could be adopted to guide the industry to develop in a more market-oriented way, according to Wu Ge: cf40.org.cn/uploads/201910…
Issues related to shadow banking are so complicated that it confuses many practitioners from the financial sector even today. This article talks about shadow banking from the following three perspectives:
1. From the perspective of liberalizing the interest rate, the development of shadow banking should not be excluded. Financial disintermediation can accelerate the marketization of interest rate.
2. From the perspective of development of capital market, deposit-and-loan model of commercial banks can hardly meet the development needs of real economy, for which a variety of financing models in capital market such as financing provided by shadow banking are very crucial.
3. From the perspective of counter-cyclical macroeconomic adjustment, the shadow banking industry could further expand under proper regulation, or at least should be allowed to grow moderately in proportion to China’s economic growth.
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