金融英语阅读本.doc

精品文档Financial English ReadingUnit 1 Money “If you can actually count your money, then you are not really a rich man.” J. Paul Getty, an American oil billionaire.I. What is Money ?As the word money is used in everyday conversation, it can mean many things, but to economists it has a very specific meaning. To avoid confusion, we must clarify how economists use of theword money differs from conventional usage.Economists define money as anything that is generally accepted in payment for goods or services or in the repayment of debts.Currency, consisting of dollar bills and coins, is one type of money. When most people talk about money, they re talking about currency. However, to define money merely as currency is much too narrow for economists. Because checks are also accepted as payment for purchases, checking account deposits are considered money as well. An even broader definition of money is often needed. As you can see, there is no single, precise definition of money or the money supply, even for economists. To complicate matters further, the word money is frequently used synonymously with wealth. When people say, Joe is richhe has an awful lot of money, they probably mean that Joe not only has a lot of currency and a high balance in his checking account but also has stocks, bonds, four cars, three houses, and a yacht. Economists make a distinction between money and wealth. Wealth includes not only money but also other assets such as bonds, common stock, art, land, furniture, cars, and houses.People also use the word money to describe what economists call income, as in the sentence Susan would be a wonderful catch; she has a good job and earns a lot of money. Income is a flow of earnings per unit of time. Money, by contrast, is a stock: It is a certain amount at a given point in time. If someone tells you that he has an income of $1 000, you can not tell whether he earned a lot or a little without knowing whether this $1 000 is earned per year, per month, or even per day. But if someone tells you that she has $1 000 in her pocket, you know exactly how much this is. Keep in mind that the money discussed refers to anything that is generally accepted in payment for goods and services or in the repayment of debts and is distinct from income and wealth.II. What does money do? Whether money is shells or rocks or gold or paper, it has three primary functions in any economy: as a medium of exchange, a unit of account, and a store of value（价值的储藏）. Of the three functions, its function as a medium of exchange is what distinguishes money from other assets such as stocks, bonds, and houses. Medium of Exchange (交易媒介)In almost all market transactions in our economy, money in the form of currency or checks is a medium of exchange; it is used to pay for goods and services. The use of money as a medium of exchange promotes economic efficiency by eliminating（节约） much of the time spent in exchanging goods and services. The time spent trying to exchange goods or services is called a transaction cost, In a barter economy, transaction costs are high because people have to satisfy a double coincidence of wants（需求的双重巧合）-they have to find someone who has goods or service they want and who also wants the goods or service they have to offer. Money is therefore essential in an economy it is a lubricant (润滑剂) that allows the economy to run more smoothly by lowering transaction costs, thereby encouraging specialization and the division of labor. Unit of Account（计算单位）The second role of money is to provide a unit of account; that is, it is used to measure value in the economy. We measure the value of goods and services in terms of money, just as we measure weight in terms of pounds or distance in terms of miles. Money we use nowadays, no matter in the form of banknotes or coin or electronic money, do not have the same value with the goods and services that it exchanged, but it represent a particular value. That is to say, money we use in the market is fiat money. Fiat money has not only no particular value in use; it doesnt even really have a value in exchange except that which is decreed that it would have.So fiat money is money which is intrinsically worthless. And its value exists by virtue of the fact that it is generally acceptable. And fiat money, needless to say, is one of the most mysterious inventions of the human mind, and no economist has managed to explain exactly why it is that people will generally accept something as valuable when it clearly has no value other than that which it is decreed to have.Store of Value （价值的储藏）Money also functions as a store of value: it is a repository of purchasing power over time. It is an asset. Its something that we can use to store value away to be retrieved at a later point in time. So we can not consume today, we can hold money instead - and transfer that consumption power to some point in the future. Money is not unique as a store of value; any asset, be it money，stocks, bonds, land, houses, art, or jewelry, can be used to store wealth. Many such assets have advantages over money as a store of value. They often pay the owner a higher interest rate than money, experience price appreciation, and deliver services such as providing a roof over ones head. If these assets are a more desirable store of value than money, why do people hold money at all?The answer to this question relates to the important economic concept of liquidity, the relative ease and speed with which an asset can be converted into a medium of exchange. Liquidity is highly desirable. Money is the most liquid asset of all because it is the medium of exchange; it does not have to be converted into anything else in order to make purchases. Other assets involve transaction costs when they are converted into money. III. Different Types of MoneyNow, lets clarify the meaning of some words that are related to “money”. Please look at the following words. These are all different forms of money, Money, Cash, Currency, Reserves, Salary, Wages, Income, Loan, Pension, Fund, Capital, Instalments, Debt, Subsidy, rebate, Deposit, Aid. Stake.What are the exact meaning of these words in English? Now, lets do some exercises, after that you will have a very clear idea of what they are. Exercise 1Choose the correct alternative to complete each sentence: 1. Money in notes(banknotes) and coins is called a. cash b. capital c. reserves 2. The dollar, the mark and the yen are all a. currencies b. funds c. monies 3. Money borrowed from a bank is a a. deposit b. income c. loan 4. Borrowed money that has to be paid back constitutes a a. debt b. fund c. subsidy5. All the money received by a person or a company is known as a. aid b. income c. wagesExercise 26. The money earned for a weeks manual work is called a. income b. salary c. wages7. The money paid for a months (professional) work is a a. loan b. salary c. wages8. Money placed in banks and other savings institutions constitutes a. capital b. deposits c finance9. Money paid by the government or a company to a retired person is a a. pension b. rebate c. subsidy10. The money that will ultimately be used to pay pensions is kept in a a. budget b. deposit c. fundNow, lets look at the follow sentence which will tell you the history of salary. Moneys got a very colourful history, because a number of things have been used in the place of what we use as money. Feathers, shells, cloth .salt. In Roman times when the Roman soldiers were paid in salt and thats how we get the word salary, from the Latin sal for salt.Exercise 311. The money needed to start a company is called a. aid b. capital c. debt_12. The money paid to lawyers, architects, private schools, etc. is called a. fees b. instalments c. wages13. Regular part payments of debts are called a. deposits b. loans c. instalments14. Part of a payment that is officially given back is called a a. gift b. instalment c. rebate15. Estimated expenditure and income is written in a a. budget b. reserve c. statementExercise 416. A persons money in a business is known as his or her a. deposit b. fund c. stake17. Money given to producers to allow them to sell cheaply is called a a. loan b. rebate c. subsidy18. Money given to developing countries by richer ones is known as a. aid b. debt c. subsidyIV. Financial System and Financial Market The Financial System Everyone has some contact with the financial system. We are all aware of financial institutions like banks, building societies, and insurance companies, each providing in its own way for some of our everyday needs. For example, payments facilities through banks, convenient savings and access to home loans from building societies, and car, house, or life insurance. Other financial institutions, such as investment trusts, venture capital companies, and discount houses-to name only a few-are less well-known and carry out more specialized functions. Most people also know something about financial markets, like the Stock Exchange where securities are bought and sold, though comparatively few are directly concerned with their activities. Again, there are other important but less familiar financial markets, like the money market in which large sums are borrowed and lent for very short periods, and the foreign exchange market in which dealings in foreign currencies take place. All these financial institutions and markets fit together into a network which comprises the financial system. Other financial institutions, such as investment trusts, venture capital companies, and discount houses-to name only a few-are less well-known and carry out more specialized functions. Most people also know something about financial markets, like the Stock Exchange where securities are bought and sold, though comparatively few are directly concerned with their activities. Again, there are other important but less familiar financial markets, like the money market in which large sums are borrowed and lent for very short periods, and the foreign exchange market in which dealings in foreign currencies take place. All these financial institutions and markets fit together into a network which comprises the financial system. The quality of the services provided by the financial system affects the performance of the economy as a whole. The most basic function of any financial system is to facilitate payments in the economy. Normally the responsibility for providing the necessary facilities falls on the note-issuing authority-the government or the central bank-and the commercial banking system. Satisfactory payments facilities are something which we are inclined nowadays to take for granted, but productive economic activity is dependent on their existence, and indeed on traders having reasonable access to short-term credit facilities. A properly developed and smooth-running financial system can do much more for the economy. It raises the levels of saving and investment and provides incentives for the allocation of the available resources to those uses where they are likely to give the highest returns. The financial system thus facilitates effective capital accumulation, one of the major engines of economic growth, and it is the saving/investment aspect which will be the focus of our attention. How well a countrys financial system satisfies users needs is a matter for public concern. By their very nature financial institutions attract criticism: bankers would not be doing their jobs if they did not turn down some requests for loans and those who are denied funds sometimes feel hard done by and are vociferous in their complaints. The control which financial institutions wield over very substantial sums of money also attracts the attention of governments, partly because they may see irresistible opportunities to secure cheap finance for favored borrowers (notably governments themselves), and partly in view of the economic power attached to control of finance. Any evaluation of the financial system should be founded on an understanding of its functions within the economic system as a whole, and the means by which these can be carried out. This must be complemented by knowledge of users requirements, of the behavior of institutions, and of market practices. Moreover, institutions and markets cannot be viewed in isolation, for it may not be important that one category of financial institution makes no provision for certain needs if these can be satisfied elsewhere in the system. What matters are not the shapes of the individual pieces, but how well the jigsaw fits together and the quality of the picture that emerges? The participants in the systemJust now we talked about three aspects of financial system: 1. What comprises a financial system. a financial system.=Financial institutions + financial market 2. The most basic function of any financial system is A. It facilitates payments in the economy.B. It raises the levels of saving and investment and provides incentives for the allocation of the available resources to those uses where they are likely to give the highest returns.3. The most important thing to evaluate the financial system: treat financial system as a whole, dont separate institutions from markets. V. The participants in the financial system The participants in the financial system can be classified into five broad groups: savers; investors and other borrowers; financial intermediaries; brokers and advisers; and regulators. The end-users of the financial system are the savers, whose current spending is less than their income and who have money available to lend to others; and the investors, who want to borrow money in order to buy capital goods or increase the scale of their business, as well as other borrowers who want to spend more than their incomes. In between lie the financial institutions and markets. Ensuring that money flows smoothly from savers through institutions and/or markets to investors is an important function of the financial system. It is the ultimate savers and ultimate borrowers who are, as it were, on the periphery of the financial system, whose needs it serves and who provide the rationale for its existence. Nevertheless, a good deal of the business of financial institutions and activity in financial markets is generated, not by new saving and investment, but by rearrangements of existing savings or changes in the form of existing borrowings. People shift money from bank accounts to building societies or vice versa, and firms raise new long-term capital in order to pay off short-term debts. Moreover, investors do not always need to borrow in order to finance expenditure; they may choose instead to run down savings accumulated from earnings previously, or they may use balances obtained by borrowing on other occasions. By permitting economic agents to organize their financing in a flexible manner, the financial system helps to make all this possible. Financial intermediaries are institutions which attempt to serve the needs of both lenders and borrowers. Savers wish to hold their savings-for example bank deposits-frequently differ from the ways in which borrowers would like to obtain their funds-for example long-term loans. Financial intermediaries are often able to reconcile these divergent requirements. In addition they provide a variety of specific services which savers and borrowers value in their own right. Examples are money transmission facilities and advice on corporate finance in the case of banks, life assurance cover in the case of insurance companies. Moreover, while there is nothing to prevent savers and investors from dealing directly with each other if they wish, the existence of financial institutions makes direct contact unnecessary, since both groups can deal with the intermediating institutions. In a competitive financial system (like that in Britain) institutions compete for business in broadly construed markets for saving and lending business; they seek to attract funds from savers and supply funds to borrowers. But there are also organized markets which provide facilities for economic agents to borrow and lend or to buy or sell securities. The main role of brokers and advisers is to help these organized markets to function properly. Brokers and advisers provide information to participants in the markets, and attempt to ensure that lenders and borrowers, buyers and sellers, have the facts they need to strike a fair bargain. They also perform the vital task of putting actual lenders and borrowers in touch with each other-for example, the money-market broker brings together the lender who has money to spare with the borrower who wants it temporarily. By obviating the need for individual borrowers or lenders to search out counterparts themselves the brokers substantially reduce transactions costs. In most organized markets there are also market makers, professional dealers whose function is to ensure that lenders and borrowers are always able to find a counterpart for th