[The monetary root of Wenzhou's economic hollowing out] The basic calculation formula of monetary multiplier

The root of Wenzhou's hollowing out lies in the mechanism of currency generation. Wenzhou is an outpost of private economy and one of the places with the best market awareness in China. However, in recent years, Wenzhou's GDP growth rate has gradually fallen behind, entities have moved out, and the trend of economic hollowing out has become increasingly serious. Is Wenzhou people's market consciousness beginning to lag behind or their wisdom and sense of smell can't keep up with the changes of the times? The answer is no, and to some extent it is the opposite.

From small commodity base to real estate speculators' base camp, Wenzhou economy is backward in GDP index, but the total value controlled by Wenzhou people is increasing. Generally speaking, Wenzhou people, as a capitalist group rather than a region (including Wenzhou people), have a higher proportion of economic resources than most parts of the country. Wenzhou's real economy is being marginalized, but the voice and status of Wenzhou Capital has not weakened, but it has become famous all over the country, so that the "Wenzhou real estate speculators" have made people all over the country feel scared. Wenzhou's economic hollowing out itself is only a shadow. It is the performance of Wenzhou people trying to attack the monopoly capital barriers of countries such as finance and mining by slowing down the expansion of industrial investment, and it is also a microcosm of the private economy with the most sensitive sense of market to maximize its interests by chasing high profits.

What's the problem? The problem is not the market awareness of Wenzhou people, nor the lack of wisdom, education or management level, but the generation mechanism of money itself.

With the development of marketization, resources without monetization have become increasingly scarce, so we can regard the total amount of assets similar to money held by all people, enterprises and units as the total stock of social wealth. Simply put, we can use M2 as a reference index to determine our economic share in the whole society.

M2 is around 20% on average from 1996. That is to say, if the total growth rate of our wage income plus assets on hand is less than 20%, we belong to a group with a declining proportion of total social resources, and our social status will decline relatively. Therefore, for private enterprises, the problem is not as simple as preserving capital and defeating CPI, but defeating M2.

China's economic growth is accompanied by two remarkable characteristics: first, the growth gap between M2 and GDP is getting bigger and bigger, and the proportion of M2 in GDP has increased from 80% to160%; Second, the proportion of our wages in GDP is getting smaller and smaller, and the corresponding consumption rate is getting lower and lower. Compared with the total monetary wealth represented by M2, GDP is closer to the statistical data of total industrial activities, and the growth of GDP lags behind that of M2, which means that the growth rate of industry can't keep up with that of M2, and the proportion of people doing business in the whole society is shrinking. The proportion of wages in GDP is getting smaller and smaller, which means that the status of working class in society is declining faster and faster, which in turn reduces the consumption rate of society and makes it more difficult for industrial profits to grow. If we continue to invest in industry, it will mean the decline of the whole social status. Looking back after years of hard work, the profit rate earned is far behind the seemingly idle real estate speculators.

Therefore, for private capital, the most correct and rational choice is to withdraw the capital invested in industry and invest it in areas that are more in line with the growth direction of M2 and have higher profits, mainly real estate. In the end, many Wenzhou enterprises maintain a certain scale of industrial production no longer for meager profits, but only for obtaining land and corresponding bank loans through scale, and then investing these funds and resources into the real estate industry to make profits. Industry has become private capital, bypassing financial monopoly and sharing currency issuance, which has become a financing channel for real estate speculators. Under such circumstances, it is no accident that the Sino-Swiss consortium jointly sponsored by many industrial companies eventually became a large-scale real estate speculators.

Why is there a situation of industrial decline and high real estate? The channels and methods of currency issuance are the main reasons behind it.

1998 since the financial turmoil, exports have become the main driving force of the economy. The growth of M 1 depends more and more on the growth of foreign exchange, which mainly comes from the foreign trade surplus and the capital inflow it attracts. Therefore, the distribution of M 1 is increasingly concentrated in areas where foreign trade is concentrated, especially in Jiangsu, Zhejiang and Shanghai. At this stage, industry is the main channel to get money. However, under this mechanism, on the one hand, the uneven distribution of M 1 leads to the widening gap between the northeast heavy industrial zone and the central and western regions, and the polarization intensifies the sluggish domestic demand; On the other hand, when the capacity expansion touches the resource bottleneck, it is difficult to completely convert the currency issued due to foreign exchange growth into M2 by expanding production loans. Private capital needs to find a corresponding place, and banks also hope to find a suitable way to lend. With the start of real estate marketization, it is more convenient to use land and real estate mortgage loans than industrial production loans. So banks and private capital hit it off, monopolizing bureaucratic capital of land resources and contributing to their own interests.

For example, the inventory of the real estate industry: intangible assets such as real estate and land can be increased through evaluation, and more loans can be obtained through various forms. However, the inventory of the industry faces depreciation and usually cannot be used as collateral, and the investment in means of production is also depreciating. Therefore, real estate loans are easier to grow than industrial loans, and the growth of loans is less restricted by effective demand. Therefore, when the 200 1 housing market soared into a high-profit industry, the growth of M2 gradually shifted from the production loans of export-oriented enterprises to the growth of real estate, land development and mortgage loans. The deposit brought by the growth of M 1 has been transformed into a higher M2 growth through the expansion of the real estate industry. Under the current statistical system, most of the price increase of real estate is not included in CPI, and the value-added part of real estate during the holding period is not reflected in GDP growth except construction cost. Therefore, the growth of M2 exceeds GDP+CPI, and the answer is found here: the huge black hole between the two is precisely the part of the real estate price expansion in M2 expansion.

Such a currency issuance mechanism leads to industries that need to sell goods to consumers in exchange for money, and the difficulty of obtaining newly issued currency lags behind that of the real estate industry, which has convenient loans and is easier to expand. When the real estate industry has become the main channel of M2 growth, the government, developers and real estate speculators who resell land have gained an increasing proportion of new monetary wealth with the help of the leverage of banks. The export-oriented economic sector, which is still able to maintain a growth rate close to M2, only relies on the international price difference caused by the exchange rate to maintain profits, and is also in jeopardy under the pressure of resource shortage and RMB appreciation.

As the forerunner of the market, Wenzhou people have turned from industry to real estate expansion in such an environment, which undoubtedly faithfully embodies the principle that rational economic people pursue the maximization of interests. The market logic is that whoever gets the largest proportion in the issuance of M2 will get more practical benefits. The weak growth of Wenzhou's real economy is a manifestation of Wenzhou's capital withdrawing from the industry and rushing to the real estate industry everywhere. This does not mean that the wealth growth rate of Wenzhou private capitalists has slowed down. On the contrary, it is precisely because of "timely transformation" that they have caught up with the expansion speed of M2. As a group rather than a region, Wenzhou folk capitalists have gained more wealth than many other regions. Therefore, Wenzhou's hollowing out and weak local GDP growth are not caused by Wenzhou people's market vision, but by the operation mode of the entire currency issuance system.