The Relationship Between Bonds and The Current Economy

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Since 2020, the outbreak of COVID-19 has had a huge impact on the global economy. In fact, as early as the outbreak of the financial crisis in 2008, it has deeply revealed the complexity of the macroeconomic system, the systemic importance of the financial sector and its high sensitivity to economic exogenous shocks. As an important part of the financial market, bond has a very important impact on the current economic development. Through the study of the current world economy, this paper finds that the epidemic is an unexpected event that changes the world power, the world pattern and the world economic relations, and will bring a profound impact on the world economy. Perhaps the most important change, pre - and post-pandemic, is that the challenges facing humanity will be even greater. The economic growth of developed economies is also unstable due to the impact of the epidemic. The growth of developing countries and emerging economies is more unstable, the risk of inflation and deflation will alternate, and the debt and financial risks are increasing. The risk of supply chain restructuring and supply chain relinking will alternate. A bond market is a place where the government can raise funds in a credit way to balance fiscal revenues and expenditures, which can play a role in promoting economic development. However, the excessive development of the bond market has a negative impact on economic growth and even poses a threat to economic stability. In this regard, this paper puts forward suggestions from the government, enterprise decision-makers and investors to promote the healthy development of the economy.