Professor and Financial Practitioners Brainstorm at School Forum

Fudan, Nov. 26: On November 20 in the school, financial Professor LI Ruoshan joined hands with fund managers to discuss about financial crisis and economic cycles, as well as appropriate ways to make assets distribution on current stage of economic uncertainties.

The two financial practitioners are Mr. XU Yunkai, who is chief research manager of China International Fund Management Co., Ltd. (CIFM), and Mr. ZHAO Zifeng, who is Chengzhang Xianfeng Fund manager of CIFM.

It was the fourth session of a finance forum under cooperation between the school and CIFM.

Firstly, Mr. XU explained the cause of financial crisis in his eyes.

He said that the crisis finds its roots in the slack policy on currency, which has resulted in excess liquidity and overspending. More than that, the policy has led to overheated investments and the consequent swelling bubble of asset prices. Financial institutions, with investment banks in the lead, have worsened the crisis by exerting their power of leverage.

Talking about the influence the crisis poses to the real economy of China, Mr. ZHAO said that such kind of influence does exist, but to a relatively limited extent because of fire wall which defends the general economic body.

As a result, the national manufacturing sector is shrinking in size, assets in domestic investment banks are squeezed, and commodity prices slumped.

But some sectors defended by fire wall might benefit from the crisis.

According to Mr. XU, the prompt interventions in the crisis which is more severe than 1929 financial crisis and 1997 Asian financial crisis in levels of intensity by central governments have raised hopes of preventing catastrophic results from happening again.

Students said that they were highly impressed by the professor and fund managers for their width and depth of knowledge.