Analysis of the Influence of Money Supply Based upon VAR on Shanghai Index

The monetary policy plays its effect through changes in money supply policy,and with some of the transmission mechanism,affects a country's economy at all levels,and changes in supply of the asset price changes will be affected.With VAR model application,selecting some variables and collating the data on money supply,the Shanghai Composite Index on China's influence on the empirical analysis,found that money supply and general economic entity by entering the stock market affect the stock market in two ways: M1 changes with direction by the direction of the basic synchronization and the stock market,M2 card index of the maximum contribution rate volatility.