The Deep Analysis on Financial Fragility and the Government's Fundamental Solution of Financial Crisis

Financial fragility,the nature of finance,energes because of the lack of liquidity which is generated from the factors such as adverse selectionor moral dilimma.American subprime mortgage crisis is a financial crisis with the most destructive effects,the most widely covers,the largest amount of government aid,the maximum financial institutions collapse after the financial crisis in 1929.It resulted in the financial fragility which caused global financial crisis,shaked the mixed financial system,greatly striled social economic of the United States.By attentively observed on the foundation of vulnerable model of financial institutions,this article explored the process in shrinkage of liquidity which caused financial crisis.It also discussed the key role of the government aids in promoting the financial and economical develpment in allsuion to financial crisis.