Empirical Analysis of Influences of China´s Fictitious Economy on Money Supply

The influences of the price level, trade and velocity of money circulation of fictitious economy on money supply appeared gradually. Empirical analysis of the influences of China´ s fictitious economy on money supply was given by using the monthly data from April 1998 to December 2008 based on the actual development of Chinese economy and theory of money demand. The results show that there is cointegration relationship between China´ s fictitious economy and money supply in the long term; and there is no Granger cause between the variables the turnover of repo. trading of treasury bonds, the turnover of investment of futures and securities trading and the money supply in the short term other than the others fictitious variables. Therefore, the results indicate that there are interaction influences between the development of China´ s fictitious economy and money supply in the long term, and there is a long-term mechanism of interaction promotion between them.