During the depression, the rate of interest reduction, the expansion of money supply, stimulate economic development. During the expansion period, the interest rate increases, the money supply is reduced, and the economic development is suppressed. So, interest rates have a big impact on our lives. Famous British economist hicks and others argue that the above theory did not consider the factor of income, and therefore unable to determine the level of interest rates, in 1937, and puts forward the is-lm model on the basis of general equilibrium theory. It establishes a theory of interest rates and income at the same time that the four factors of savings and investment, money supply and monetary demand interact.