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国外金融系统对比 Policy Responses of the UK and the US Financial Systems
Toward Global Financial Market
1. Introduction
The whole world witnessed a serious financial crisis since the mid of 2007. Governments of the world’s economies have taken related measures to respond to this large-scaled crisis especially in conducting monetary and fiscal policy to deal with the financial problems caused by this crisis. The valuation of these actions is important to academic financial study because these measures can be inferred by economists to obtain precious experience and to imply similar policies to fight against similar crisis in the future. Also, the importance of learning from the experience of these measures can also be seen as a hint to avoid large-scaled global financial crisis in the future. This essay argues that the policies chosen by the US and the UK financial institutions are effective and appropriate under the highly uncertain financial environment of the world.

So, over the past two years, the global economy has suffered financial turbulence which has brought about negative influence upon the national economic order of the UK and the US. In the meanwhile, the consequences on economic and financial activity are also obviously available with the occurrence of price instability in many areas, including manufacturing materials and consuming goods. Governments and central banks in many parts of the world are thinking of effective ways to fight against this serious shock in finance. They have chosen most effective policies to address the causes of the problem they are facing. This has become the central task of the US and the UK’s financial institutions as well. This essay, based on the situational analysis of the US and UK’s adaptation of the financial policies and the role of the financial institutions, tries to dig out the possible measures that have been taken and will be taken by the US and the UK governments to deal with the current financial crisis worldwide.

2. The impact of the current turmoil of the international financial market
2.1 Impacts on financial institutions
2.2 Impacts on credit markets
 
Chart 1: The TED Spread in 2008
(The TED Spread is a measure of credit risk for inter-bank lending. It is the difference between the three-month US treasury bill rate and the three-month LIBOR rate. A higher TED Spread perceive each other as riskier counterparties. Source from the Financial Report of St. Louis Federal Reserve Bank 2008)
 
2.1 Impacts on individual consuming behavior
The negative impact on individual consuming behavior is the most obvious. The current crisis marked the end of the easy-money system of the UK and the US of the past few decades since the 1980s, which was considered to be the boom era for individual consuming. However, with the tightening of the financial conditions, 
2.2 Impacts on international trade
2.3 Impacts on the UK and the US financial policies

3. Measures taken to deal with the financial turmoil by the UK and the US
3.1 Reforming the role of financial institutions
3.2 Reforming financial marketing systems
3.3 Reforming financial regulations
I. Reducing leverage and increasing liquidity
II. Counteracting pro-cyclicality in the bank capital regime
III. Improving market incentives for more prudent behavior
3.4 Reforming in international capital markets
4. Conclusion
 
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