Money Shortage, Monetary Settlement and Monetary Policy —— A Monetary Settlement Model Based on the Theory of Money Supply and Demand

China's "money shortage" is a micro liquidity tension that has occurred in macro liquidity. Based on the theory of money supply and demand, this paper builds a unified monetary settlement theory and model. The findings show that China's money shortage is a structural and cyclical monetary contraction caused by currency deposits. The deeper reason is the failure of the policy under the guidance of the wrong index and theory. To cure this problem, it is necessary to construct a theoretical model that is more realistic, and to act from the aspects of system, structure and implementation of monetary policy.