Liquidity preference theory is that people prefer to hold high mobility but cannot generate monetary profit, rather than holding the other can generate profits but more difficult to become cash assets psychology. Its essence is the demand for money, we can put the liquidity preference as to money of a psychological preferences. The liquidity motive in three ways: the transaction motive, precautionary motive and the speculative motive. Among them, the money demand and interest rates due to the transactions motive and the precautionary motive has no direct relationship, it is a function of income, and proportional to income; and the speculative demand for money and interest rates brought is inversely proportional to,because higher interest rates people hold money for machine opportunity cost is higher.