ABSTRACT

With the onset of financial globalization，increasing the competitive ability of financial institutions and realizing the steady，highly effective operations of the financial sector have become themajor goals of themodernization of China's Financial Supervision system.Because of the complex and diverse issues involved in financial globalization and the low efficiency of financialmonitoring in China，it behooves us to conduct deeper reexamination and rationalize the development of ideology behind the financial supervision system.Apart from reasonably infusing scientific innovations into this system，the government should pay more attention to the fundamental and cause drastic transformation of this system.

The content of this article，according to this framework，is composed of three parts:introductory remarks，themain text and conclusion.

Introductory Remarks.This is a brief introduction to the research background，the current status of domestic research and overseas research in the same filed，and the structure，techniques，and innovative aspects of this research.This introduction also addresses the limitations that are still present to the current research methods.

Chapter One，Interpretation of Concepts:Financial Globalization.By explaining the inner functionalities and revealing the external characteristics of financial globalization based on empirical research and comparative studies，this chapter carefully analyzes the effects of financial globalization，and points out that financial globalization is actually the extension and inevitable requirements of the“marketability”of financial activities.In other words，from economic perspectives，financial transactions are expanded at global level;from legal perspective，a financial system which is highly“market-oriented”is adopted and promoted at global level.With the financial globalization running at both fronts in parallel，the liberalization of legislation in financial supervision，globalization of financial capital inflows and outflows，smooth orchestration of financial policy coordination efforts，unitization of the rules governing Financial Supervision system all attributes remarkably to financial globalization.This phenomenon produces positive effects on a country's economic growth. On the other hand，it has induced economic conflicts and financial crisis and created the consequences of a clash of benefits and risks，economic and financial dilemma.

Chapter Two，Review of Relations:Historical Development of Globalization and Financial Supervision.This chapter briefly reviews the evolution of the modern Financial Supervision system in retrospect，then cites Thailand and Malaysia as examples to examine activities and operational features of a financial supervision system that intends to guard against financial risks and crisis.Based on analysis and examination，the author thoroughly discusses the legal nature and functions of a financial supervision system and the basic guidelines of an efficient government regulatory system.All these analysis reveals the following:financial globalization does not necessarilymean abolishment of a financial supervision system;on the contrary，the level of financial risk and prevention of financial crisis not only reflects but also is actually determined by the way a country conducts its financial supervision system.Thus the answer lies in how to design a workable and feasible financial supervision system to fulfill limited but effective supervision of financialmarket by the government.

Chapter Three，Review and Re-examination:Empirical Analysis of China's Financial Supervision Operations.This chapter provides a systematic review and empirical analysis of the current operation of the China financial supervision system.The review reveals that inefficientoperations of financial supervision regulatory system not only weakens competitiveness of financial institutions but also leads to dramatic increase of potential financial risks.It is the interaction among the influence of social traditions，the structural defects of the supervision system，the malfunctions in the supervision operationalmechanism as well as flaws in legislations that form the key factors that block the China financial supervision scheme from being highly efficient and effective.

Chapter Four，Strategic Design of China Financial Supervision System from Globalization Perspectives.To accomplishmodernization of the financial supervision system in China，it requires complete upgrades and synchronized reforms in respects of value/awareness，system designs and operation modes.

First，with regard to value orientation，we should subscribe to a new value for financial supervision that grants priority to competitiveness and reaches balance between competitiveness and stability.Financial supervision system needs innovations，including providing a unified jurisdiction for conducting financial supervision and establishing a deposit insurance system.

Second，with respect to the role and functionalities of the financial supervision，while the government is empowered to supervise the financial system，the emphasis should be given to effectively encourage supervisions and improve disclosure system，liability system and operational procedures.The ultimate goal is to have a win-win situation for both financial supervision and businessmanagement.

Third，as to the choice of regulatory policies，we should adoptan open and conservative strategy.Wemustmake full use of the principle of prudent supervision and improve supervision methods to accomplish a balance between the openness of the financial system and protection of the system.

Finally，when designing government regulatorymodes，we should encourage cooperation between government forces and private sectors in financial supervision.The goal is to construct a joint-force regulatory system which composes aspects of governmentalmonitoring，market restraints and self-discipline by industries.To reach this goal，wemust overhaul the laws and regulations in the financial sectors and make substantial efforts to develop financial industry associations.

Key words:Financial Globalization　Financial Supervision　Governmental Regulatory system　Market Restraint