300 trillion! Where does the money go? CCTV gave an explanation!

Livestock Corps 2024

2024-05-11 22:15Published in Guangdong financial field creators

Many people have questions: China's broad currency, M2, has exceeded 300 trillion yuan. But why does everyone feel like they don't have money? The 300 trillion is printed, it will not disappear out of thin air, where does the money go? In whose pocket? Why is it that everyone in the market is short of money, and it is becoming more and more difficult to make money?

Regarding this question, the central bank gave a rough answer. First of all, the 300 trillion was indeed printed. In economics, money is mainly divided into M0, M1 and M2.

Among them, M0 refers to cash, the money that can be taken out at any time, the highest liquidity, and the largest transaction activity, for example, the change in the WeChat wallet and Alipay wallet, which is mainly cash.

M1 refers to demand deposits, which are a little less liquid than cash, but can also be taken out at any time. It's just that most people's current deposits will not be taken out and spent regularly, either in the balance treasure, or in the bank card, and in the WeChat change.

M2 mainly refers to M1, plus additional fixed deposits. It includes M1 demand deposits, plus fixed deposits, both personal and company, all counted, basically the real wealth in everyone's hands. But whose account is so much money stored in?

From a macro perspective, it is mainly divided into three major departments:

First, the resident department is everyone's personal account deposits.

Second, the enterprise sector, the account deposits of major companies, including private enterprises and state-owned enterprises.

Third, government departments are the deposits of major government units, public institutions and other public sectors.

In proportional terms, the resident sector has the largest share of deposits, accounting for 49%. Of the 300 trillion yuan, about half of the money is in personal bank accounts. The corporate sector has the second largest share of deposits, accounting for 27%, while the government sector has the least, accounting for only 14% of deposits. In contrast, it seems that personal deposits are the largest, the corporate sector is second, and government deposits are third.

But there are still some questions.

First, what is the proportion of deposits in the personal sector, civil servants, public institutions, and state-owned enterprises? What is the proportion of deposits of private enterprises, farmers, etc.? Only by making this data public can we more clearly reflect whose hands is the money?

Second, what is the proportion of deposits in state-owned enterprises in the enterprise sector? What is the proportion of deposits of private enterprises? Is the money in the hands of state-owned enterprises or private enterprises? What is the proportion of deposits of large leading enterprises? What is the proportion of deposits of small and micro enterprises? Is the money concentrated in the hands of a few large corporations? Are small and micro enterprises getting harder and harder?

The government has little deposits, and everyone can understand this. After all, budgets are meant to be spent, not saved. Civil servants' salaries, pensions, medical care, national defense spending, education, transportation, etc., all need money.

The question of whether there is a shortage of money is that we should not only look at deposits, but also look at loans. It's not that there is a deposit, it's enough, it depends on how much the loan is owed. According to data released by the central bank, as of the end of March this year, the balance of loans to Chinese enterprises and institutions was 163 trillion yuan, while the balance of loans to residents was 81 trillion yuan. 300 trillion yuan of currency has been issued, but the joint debt of enterprises, institutions and residential departments across the country is 244 trillion yuan, and the debt pressure is not small.

Among household loans, non-residential consumer loans account for no more than 10%. In other words, the vast majority of China's loans are staked on housing loans. About 50% of corporate loans are invested in infrastructure, manufacturing and real estate development. Businesses also owe a lot of money, most of which is medium and long-term loans. Why did 300 trillion yuan be printed, but most people felt that they had no money?

There are two main aspects:

First, a large part of the money is saved in the form of deposits and does not flow out of the bank. If there is no outflow, there will be no consumption and no economic growth. The lack of consumption makes everyone more lacking in performance, and it is more difficult to make money. In economics, this is called "liquidity shortage". The money is indeed printed, but it is not flowing, and the economic value cannot be amplified.

Second, in the form of medium and long-term loans, it has flowed into enterprises and real estate. Loans have put enterprises and residents on a relatively heavy debt. After making money, I didn't dare to spend it, and I had to pay off my debts first, which still suppressed consumption. To whom is this debt owed? Ready to say, I owe it to my future self.

Liabilities are essentially overdrafts of future income. For example, I am now taking out a loan of 1 million to buy a house, and the repayment period is 30 years. I just borrowed 1 million from my future self, and it took 30 years to pay it off. However, there is no way for me to borrow money from my future self. At this time, the bank acted as an intermediary and advanced my money for the next three years in advance. The interest difference earned by the bank is actually a time difference.

As a result, most residents have suppressed their spending power, and money continues to flow back to the banks. Banks then lend their deposits to manufacturing, infrastructure, real estate, etc., and these manufacturing enterprises, real estate enterprises, and infrastructure companies are also burdened with heavy debts.

Why did China print 300 trillion yuan, but there was no inflation? Because real estate is a huge reservoir. It took the currency back up. The residential sector seems to have a lot of savings, but it also has a lot of loans, and the disposable income that can really be spent is actually very small.

And those who have large deposits lack good investment channels, and pure consumption cannot be spent at all.

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