Unit13-Giving-Credit-Where-Debt-Is-Due.ppt

1、Unit 13 Giving Credit Where Debt Is Due,By citing the film Its a Wonderful Life, the writer introduces the topic and the thesis statement: misplacing bank funds may plunge a family into debt. However, being in debt is no longer a scandal or puts one into prison, but is a very cool thing. Then the au

2、thor explains the reasons for the popularity of credit card debt: Consumers are involved in the annual rite of the holiday spending binge; People dont have to worry about debt because banks are now relentlessly encouraging the use of credit cards so that even bankruptcy doesnt stop the borrowing of

3、money from banks;,I. About the Text,Suggested Summary (1-1),Debt makes people unconscious of the purchasing process and makes them into debt for small things like a bottle of champagne or a new wardrobe; Americans are ready to take a new look at debt: debt is no longer something to be ashamed of as

4、it was for the generation that came of age during the Great Depression. Lastly the author points out that several credit card companies have taken a financial beating because of the sharply rising charge-offs for bad credit card debt. The solution to the problem is to make consumers think it wise to

5、 lighten their debt loads and try to rid themselves of personal debt.,Suggested Summary (1-2),Definition of a credit card It is a system of payment named after the small plastic card issued to users of the system. Wikipedia,II. Background Information (1),Category of Bank Cards Credit Card（信用卡） A cre

6、dit card is a card that is issued by a lender. When a consumer uses a credit card they are incurring debt and can either pay the balance off immediately or they can pay it off over a period of time. This card provides some convenience to the consumer in that they dont have to carry cash or write a c

7、heck and can pay for the purchase at a later time.,II. Background Information (2-1),Debit Card（借记卡） A debit card is not a credit-based transaction. When a consumer uses their debit card the funds are debited from the account associated with the card, such as a checking or savings account. When using

8、 a debit card the consumer can usually select “debit” or “credit”. If debit is selected, the user must enter a PIN. If the user selects “credit” they do not have to and are not charged banking fees sometimes associated with using a debit card.,II. Background Information (2-2),Frank Capra Frank Capra

9、 is An American film director known for his sentimental movies about American life. He was born in Italy on May 18, 1897. He went to America at the age of six. After graduating from college with an engineering degree and serving in the military, he began his Hollywood career, and then became a write

10、r and director.,II. Background Information (3-1),Films such as The Younger Generation (1929), The Miracle Woman (1931), The Bitter Tea of General Yen (1932), and Lady for a Day (1933) put him on top. It Happened One Night (1934) became the first film to win all five major Oscars. After directing Los

11、t Horizon (1937) , he left Columbia and began working for Warner Brothers. After the War, he, George Stevens and William Wyler formed Liberty Pictures, which produced Its a Wonderful Life (1946) and State of the Union (1948).,II. Background Information (3-2),Its a Wonderful Life The film was made in

12、 1946. It is the ultimate feel-good film. Starring the unforgettable James Stewart as George Bailey, the man who receives the greatest Christmas gift of all, and a superb ensemble cast including Donna Reed and Lionel Barrymore. This high spirited Christmas tale is directed by the immortal Frank Capr

13、a and ranks as an all-time favorite of fans and critics alike.,II. Background Information (4),Puritans and Quakers Both of them were American religious groups, known for being frugal. Both did not wish to conform to the Church of England. Instead they wanted to establish their own community where th

14、ey were dominant instead of the Church of England. The Bible read in a very narrow way is much emphasized. Quakers on the other hand see God as a Spirit who lives in the heart of every human being and offers them direct and personal guidance. There were no paid professional clergy but instead minist

15、ry was open to anyone, male or female, who felt led to speak in meeting for worship.,II. Background Information (5),Imelda Marcos Imelda Marcos was the wife of former Philippine President Ferdinand Marcos who was known for her shopping habits.,II. Background Information (6),Thomas Jefferson and His

16、Debt Thomas Jefferson (1743 - 1826) was one of the writers of the Declaration of Independence and the third President of the United States. Throughout his life, Jefferson had long been troubled by debt. After his retirement from the government, the failure of a friend whose note Jefferson had endors

17、ed brought him to virtual bankruptcy. His personal debt at the end of his life in 1826 reached $80,000.,II. Background Information (7),Bank of America The nations second-largest bank Charlotte-based Bank of America now has 40 million active credit card accounts on its ledger, making it one of the le

18、ading worldwide payments-services companies and issuers of credit, debit and prepaid cards based on total purchase volume.,II. Background Information (8),MBNA MBNA is the leader in so-called affinity marketing, with established branding relationships with more than 5,000 organizations and financial

19、institutions, from the National Football League to L.L. Bean to hundreds of medical organizations.,II. Background Information (9),Mortgage A mortgage is a loan you take out to buy property. Most banks and building societies offer mortgages, as well as specialist mortgage lending companies. If you ch

20、ange lenders but dont move home its referred to as a remortgage.,II. Background Information (10-1),Choosing a Mortgage: Where to Start? You can get a mortgage directly from the lender (banks, building societies and specialist mortgage lenders), or you can use a mortgage broker. You can buy based on

21、information only or get advice and recommendation on a mortgage that suits your particular needs.,II. Background Information (10-2),Two Main Ways to Repay Your Mortgage “repayment” With a repayment mortgage you make monthly repayments for an agreed period (the term) until youve paid back the loan an

22、d the interest. “interest only” With an interest only mortgage you make monthly repayments for an agreed period but these will only cover the interest on your loan.Youll normally also have to pay into another savings or investment plan thatll hopefully pay off the loan at the end of the term.,II. Ba

23、ckground Information (10-3),Other Facts About Mortgage Flexible Features Some mortgages offer you options to vary your monthly payments, or to combine your mortgage account with savings and other income - these are called flexible, current account and offset mortgages.,II. Background Information (10

24、-4),Interest Rates Youll also find a range of interest rates to choose from. For example, variable and tracker rates change in line with Bank of England rates, fixed rates are fixed for a set number of years, and capped rates have a variable interest rate with a ceiling so your payments wont go abov

25、e a set amount.,II. Background Information (10-5),Insurance A lender may require you to take out life insurance to pay off your mortgage should you die.You can also get insurance to protect your income or just your mortgage payments if you become ill or disabled, or lose your job.,II. Background Inf

26、ormation (10-6),Subprime Borrowers Subprime offers an opportunity for borrowers with a less than ideal credit record to gain access to credit. Borrowers may use this credit to purchase homes, or in the case of a cash out refinance, finance other forms of spending such as purchasing a car, paying for

27、 living expenses, remodeling a home, or even paying down on a high interest credit card. However, due to the risk profile of the subprime borrower, this access to credit comes at the price of higher interest rates.,II. Background Information (11-1),On a more positive note, subprime lending (and mort

28、gages in particular), provide a method of credit repair; if borrowers maintain a good payment record, they should be able to refinance back onto mainstream rates after a period of time. Credit repair usually takes twelve months to achieve; however, in the UK, most subprime mortgages have a two or th

29、ree-year tie-in, and borrowers may face additional charges for replacing their mortgages before the tie-in has expired.,II. Background Information (11-2),Generally, subprime borrowers will display a range of credit risk characteristics that may include one or more of the following: Two or more loan

30、payments paid past 30 days due in the last 12 months, or one or more loan payments paid past 90 days due the last 36 months; Judgment, foreclosure, repossession, or non-payment of a loan in the prior 48 months; Bankruptcy in the last 7 years;,II. Background Information (11-3),Relatively high default

31、 probability as evidenced by, for example, a credit bureau risk score (FICO) of less than 620 (depending on the product/collateral), or other bureau or proprietary scores with an equivalent default probability likelihood.,II. Background Information (11-4),1. As Frank Capras mid-century holiday movie

32、 classic, “Its a Wonderful Life,” crowds its way onto television screens, feel free to snicker at the moment when a desperate George Bailey screams at his negligent uncle for misplacing bank funds and threatening to plunge the family into debt. (para. 1) As the Christmas seasons famous beloved film

33、“its a wonderful life” (created by Frank Capia) is shown on TV sets all across the USA, you are welcome to laugh a bit during the scene when extremely worried and upset George Bailey (played by famous actor Jimmy Stewant) yell at his careless uncle, who lost money from their savings and loan (a type

34、 of small bank) and almost caused the Bailey family to go bankrupt (have lots of money to be unable to pay).,III. Language Points (1-1),plunge (somebody/something) into something “plunge into” is a phrasal verb which means “to suddenly experience a difficult or unpleasant situation, or to make someo

35、ne or something do this”. This would hit struggling homebuyers and businessmen, plunging Britain deeper into recession.,III. Language Points (1-2),2. America, safe haven of the highly leveraged country and the highly leveraged corporation, is now home to the highly leveraged citizen. (para.3) The US

36、A, a safe refuge for a nation which is deeply in debt, and safe refuge for companies heavily in debt, and now is a country where many people are heavily in debt.,III. Language Points (2),3. Nonetheless, lenders have begun to target the least creditworthy and most unsophisticated debtors-to-be, dubbi

37、ng them “sub-prime” borrowers. However/ In spite of this, banks have started to focus on lending money to those future borrowers/customers who are least deserving of credit and least knowledgeable about borrowing money, calling them “sub-prime” (below good) borrowers.,III. Language Points (3),4. Ban

38、ks, which once upon a time emphasized savings and thrift, are now relentless marketers of debtor credit, to use the sanitized term favored by lenders. (para. 8) In the past (in the old days) banks encouraged saving money and wise, careful management of money. Now banks constantly try to sell loans “

39、extend credit” in nicer words. “thrift” is an old-fashioned word which means “wise and careful use of money, so that none is wasted”. “marketer” means “someone who promotes or exchanges goods or services for money”, e.g. a major wine marketer,III. Language Points (4),5. “What debt is doing is that i

40、t anesthetizes the purchasing process,” (para. 10) All this debt is causing people to be immune to the dangers of borrowing as a means of purchasing things. (“anesthetize” means to make unconscious or to give a drug to reduce pain) “What debt is doing” is the subject of this sentence,III. Language P

41、oints (5),6. Its just instant gratification, a short-lived burst of fun, and its not smart.” (para. 10) These things like champagne, etc are merely pleasures of the moment and going into debt is stupid.,III. Language Points (6),7. Credit cards were the enablers but inflation was the trigger. (para.

42、15) Credit cards allowed people to go into debt, but inflation (rise in CPI) pushed them /motivated them to do it. Here “trigger” means to be the thing that quickly causes a serious problem能引起或促使一连串反应的事（物） be the trigger (point) (for something) The hijacking became a trigger point for military actio

43、n.,III. Language Points (7),8. People in the late 1970s started recognizing that it made sense to go into debt because of inflation. (para. 15) During the late 1970s most people began realizing that inflation made borrowing money/owing money reasonable. “it makes sense (for somebody) to do something

44、” means “to be a sensible thing to do” It makes sense to save money while you can. Would it make sense for the city authorities to further restrict parking?,III. Language Points (8),9. In the 1800s, the end of the year did not entail holiday shopping sprees but was a time to pay off debts to begin t

45、he new year with a clean slate and a clean conscience. (para. 17) During the 1800s years end Christmas seasons was not a time of Christmas gift buying binges, but rather a good time to pay bills and start the new year debt-free and worry-free (clean slate is like a clean blackboard, a fresh start),I

46、II. Language Points (9),10. Burning the mortgage was a big family event. (para. 18) Making the final house payment to the bank and clearing the mortgage was a big deal for the family “burning the mortgage” means “to pay off the mortgage”. “big” means “important, significant”.,III. Language Points (1

47、0),11. But once the emotional shock of the Depression subsided and the post-World Warconsumer boom occurred, Americans were primed to take a new look at debt.(para. 19) However, after the bitter memories of the Great Depression (1929-1930s, a time when many people lost their jobs, their houses and t

48、heir money) faded, and the US economy grew rapidly after World War II, Americans were ready to reconsider the pros and cons of borrowing money. “subside” means “if a feeling, pain, sound, etc. subsides, it gradually becomes less and then stops”,III. Language Points (11),12. Charge-offs for bad credi

49、t debt have risen sharply this year at Advanta and other big credit card issuers. (para. 20) Charge-offs/Write-offs (when the company gives up collecting the debt) for bad debt (The money wont or cant be repaid) on credit cards have dramatically increased this year at Advanta (name of a company) and

50、 similar companies which issue lots of credit cards.,III. Language Points (12),13. There, every weeknight, youll find a game show called “Debt,” which gives contestants the opportunity to win enough money to rid themselves of personal debtuh, credit. (para. 22) Every Monday through Friday night on t

51、he “Lifetime” cable TV channel you can watch a TV game show called “Debt” in which contestants (those competing to win the game) have the chance to win sufficient funds to pay off their bills (debt) uh, credit. (The author says “Uh” as if he pauses to realize his mistake, then says the nicer, politi

52、cally correct word: credit. Debt sounds bad and credit sounds nicer!),III. Language Points (13),1. mortgage n. ( countable ) A. a legal arrangement by which you borrow money from a bank or similar organization in order to buy a house, and pay back the money over a period of years Theyve taken out a

53、30 year mortgage (=they will pay for their house over a period of 30 years). We decided to use Freds redundancy money to pay off the mortgage (=pay back all the money we borrowed for a mortgage). B. the amount of money you borrow in the form of a mortgage If you earn 20,000 per year, then you may be

54、 able to get a mortgage of 60,000.,IV. Word Study (1-1),mortgage vt. A. if you mortgage your home, land, or property, you borrow money, usually from a bank, and if you cannot pay back the money within a particular period of time, the bank has the right to sell your property in order to get the money

55、 you owe it. We mortgaged our house to start Pauls business. B. to borrow money or do something that is likely to cause problems in the future, that other people will have to deal with mortgage the/somebodys future. The report explains how governments are mortgaging their nations futures.,IV. Word S

56、tudy (1-2),2. prime vt. A. to prepare someone for a situation so that they know what to do prime somebody with something Did you prime her with what to say? prime somebody for something He had a shower and primed himself for action. prime somebody to do something He had been primed to say nothing ab

57、out it. B. to put a special layer of paint on a surface, in order to prepare it for the next layer All metal surfaces will have to be primed.,IV. Word Study (2-1),prime n. (singular)the time in your life when you are strongest and most active Shes now forty and still in her prime. He is now past his

58、 prime. a young singer who was tragically cut off in her prime (=died while she was in her prime),IV. Word Study (2-2),prime adj. （only before noun） A. most important （synonym）main Our prime concern is providing jobs for all young school leavers. He was named as the prime suspect in the murder inves

59、tigation. Good management is of prime importance in business.,IV. Word Study (2-3),B. of the very best quality or kind The hotel is in a prime location overlooking the valley. C. to be the person or thing that is most suitable or most likely to be chosen for a particular purpose be a prime candidate/target (for something) The school is a prime candidate for closure. Old people are a prime target for thieves.,IV. Word Study (2-4),3. slate n. A.（uncountable）a dark grey rock that can easily be split into flat thin pieces B. countable (especially British English) a small