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in recent years, the growth of national debt and the repayment of existing debts have been important issues in china's economy. the measures taken by the government, such as the increase in social financing, have tried to fill the gap of insufficient supply, but the effect is difficult to meet the changes in demand. the government's strategy of "continued printing of money" seems to have fallen into a dilemma of idle funds.
on the one hand, the central bank's interest rate cut played its role as a macroeconomic policy tool, but there was a divergence between the wishes of households and corporate sectors and the central bank's monetary policy goals. consumption and investment growth were weak, and the market reaction was insufficient, resulting in limited effect of the interest rate cut. this put the economic situation into a state of "idle capital".
on the other hand, the government debt continues to rise, which puts great pressure on the national finances. the pressure to repay the existing debt is also increasing, and the government has to seek new financing channels to support economic development. however, these financing methods cannot really promote economic growth, but instead lead to the further aggravation of the phenomenon of "idle capital".
however, with the current situation of insufficient demand, the stimulus measures taken by the government are difficult to effectively solve the problem. although monetary policy has played a certain role, its effect is limited when faced with the dilemma of insufficient demand.
this shows that monetary policy alone cannot solve the economic difficulties. we need to fundamentally change the national income distribution system and social security system, and improve the income and security of workers to solve the problem of "lack of demand".