Lessons from the International Financial Crisis for China’s Legislation of Financial Supervision

The outcome of an international financial crisis is partially attributed to legal failure in control and regulation at both macro and micro levels.The legal failure of the USA to regulate the monetary policy of the Federal Reserve properly led to the current crisis in a large sense.To be specific,its poor legislation of financial credit supervision saved much space for illegal second loan and stored much for the outcome of the crisis.In a word,its legal weakness in the banking supervision system brought about the crisis largely and its legal failure to keep a long-term coordinate development of banking technology and system innovation triggered the crisis critically.The lessons from the international financial crisis suggest that China should call for an integration of market regulation with government control,a strengthened financial supervision,a reinforced financial innovation risk-prevention mechanism,a thorough legal-supervision-based prevention mechanism of financial risks,and a legal prevention of further intrusion into the real economy by the international financial crisis.