Nowadays, the world has transitioned to a virtual economy, which means that the financial market is highly developed. Financial market refers to the market where money lending and financing are realized and various bills and securities are traded, generally including capital market, money market, foreign exchange market, insurance market and derivative financial instrument market. The most basic function of financial market is to meet the investment demand in the process of social reproduction and promote the concentration and transformation of capital. There are three main functions: 1. Financing function; 2. Macro-control function; 3. Optimize the resource allocation function.
At the same time, the financial market also has its fragility, which is manifested in the imbalance between short-term debt and foreign exchange reserves; Huge current account deficit; The budget deficit is large. These factors will greatly affect the operation of the economy.