Bonds
Companies finance most of their activities by way of internally generated cash flows. If they need more money they can either sell shares or borrow usually by issuing bonds. More and more companies now issue their own bonds rather than borrow from banks because this is often cheaper: the market may be a better judge of the firm’s creditworthiness then a bank, i.e. it may lend money at a lower interest rate. This is evidently not a good thing for the banks, which now have to lend large amounts of money to borrowers that are much less secure than blue chip companies.
Bond-issuing companies are rated but private ratings companies such as Moody’s and Standard & Poor’s, and given an “investment grade” according to their financial situation and performance, Aaa being the best and C the worst, i.e. nearly bankrupt. Obviously, the higher the rating, the lower the interest rate at which a company can borrow.
Most bonds are bearer certificates, so after being issued (on the primary market), they can be traded on the secondary bond market until they mature. Bonds are therefore liquid, although of course their price on the secondary market fluctuates according to changes in interest rates. Consequently, the majority of bonds on the secondary market are traded either above or bellow par. A bond’s yield at any particular time is thus it’s coupon (the amount of interest it pays) expressed as a percentage of it’s price on the secondary market.
For companies the advantage of debt financing over equity financing is that bond interest is tax deductible. In other words, the company deducts its interest payments from its profit before paying tax, whereas dividends are paid out of already-taxed profits. Apart from this “tax shield”, it is generally considered to be a signed of good health and anticipated higher future profits if a company borrows. On the other hand increasing debt increases financial risks: bond interest has to be paid, even in a year without any profits from which to deduct it, and the principle has to be repaid when the debt matures, whereas companies are not obliged to pay dividends or repay share capital. Thus companies have a debt-equity ratio that is determined by balancing tax savings against the risk of being declared bankrupt by creditors.
Governments, of course, unlike companies, do not have the option of issuing equities. Consequently the issue bonds when public spending exceeds receipts from income tax, VAT, and so on. Long term government taxes are known as gilt-edged securities, or simply gilts, in Britain, and Treasure Bonds in the US. The British and American central banks also sell a buy short term (free months) Treasury Bills as a way of regulating money supply. To reduce the money supply, they sell these bills to commercial banks, and withdraw the cash received from circulation; to increase the money supply they buy them back, paying with newly created money which is put into circulation in this way.
Translation ( Romanian)
Obligatiunile
Companiile finanteaza majoritatea activitatilor prin modalitatea fluxurilor financiare generate intern.Daca au nevoie de mai multi bani acestea pot sa-si vinda actiunile sau sa imprumute, de obicei prin generare de obligatiuni. Din ce in ce mai multe companii emit propriile obligatiuni decit sa le imprumute de la banca, deoarece aceasta metoda este mult mai eftina: piata poate fi un judecator mai bun al bonitatii decit o banca, adica ar putea imprumuta bani pentru o rata a dobinzii mai mica. Evident ca acesta nu este un lucru bun pentru banci, care acum trebuie sa dea cu impumut sume mari de bani debitorilor, acestea fiind mai putin stabili decit companiiile care emit hirtii de valoare cu un grad sporit de risc. Companiile emitatoare de obligatiuni sunt evaluate de companii private de evaluare( rating) precum Moody’s si Standard & Poors, si acordind o „nota investitionala” in concordanta cu situatia financiara si performante, Aaa fiind cel mai bun, si C cel mai rau, aceasta fiind aproape falit. Evident la o evaluare cit mai inalta , o companie poate imprumuta la o rata a dobinzii mai mica. Majoritatea obligatiunilor sunt purtatoare de certificate, deci dupa emiterea lor( pe piata initiala) ele pot fi schimbate pe piata secundara, inainte de a atinge maturitatea. Obligatiunile sunt asadar lichide, chiar daca pretul lor pe piata secundara variaza in concordanta cu schimbarea ratei dobinzii. In consecinta, majoritatea obligatiunilor pe piata secundara, sunt comercializate fie deasupra sau sub egalitatea schimbului. Astfel venitul obligatiunilor la un anumit timp este astfel cuponul sau ( cantitatea de dobinda platita), exprimata in procentajul pretului pe piata secundara. Pentru companie avantajele finantarii datorii asupra finantarii prin actiuni, este ca rata obligatiunilor este scutita de taxe. Cu alte cuvinte, o companie deduce plata dobinzii din profiturile lor, inaintea platirii taxei, avind in vedere ca dividentele sunt platite din profiturile deja taxate. In afara acestui „ scut de taxe” , este in general considerat a fi un semn de buna performanta si profituri mari anticipate in cazul in care o companie imprumuta . Pe de alta parte cresterea datoriilor generale creste riscurile financiare: dobinda obligatiunii trebuie sa fie platita, chiar si intr-un an fara profit din se poate deduce, si principalul trebuie trebuie sa fie platit, cind datoria ajunge la limita, in asa fel companiile nu sunt obligate sa plateasca dividentele sau sa plateasca capitalul impartit. Astfel companiile au o rata a actiunilor obligatoare, acestea fiind determinate de echilibrarea bugetului de stat impotriva riscului de a fi numiti falitide catre creditor.
Guvernele de sigur, spre deosebire de companii, nu au optiunea de a emite capitaluri proprii. In consecinta ei emit obligatiuni cind cheltuelile publice sunt mai mari decit incasarile de la taxa pe venit, TVA, si asa mai departe. Obligatiunile guvernamentale pe timp indelungat sunt cunoscute ca titluti de valoare „ gilt-edget”, sau mai pe scurt hirtii de valoare in Anglia, si obligatiuni de stat in SUA. Bancile centrale Americane si Britanice de asemenea vind si cumpara certificate de trezorariede scrta durata( trei luni), acestea fiind o modalitate rugulatorie a masei monetare pentru a reduce masa monetara, ei vind aceste certificate catre bancile comerciale si retreag numeralul obtinut din circulatie, pentru a creste masa monetara ei le cumpara inapoi, platind cu noi bani creati, in acest fel acestia fiind pusi in circulatie.
posted by Rusulschi Ecaterina, Sorocovici Cristina
Friday, November 26, 2010
Stocks and shares
Companies.
Individuals, and groups of people business as a partnership, have unlimited liability for debts, unless they form a limited company. If the business does badly and cannot pay its debts, any creditor can have it declared bankrupt. The unsuccessful business people may have to sell nearly all their possessions in order to pay their debts. This is why most people doing business form limited companies. A limited company is a legal entity separate from its owners, and is only liable for the amount of capital that has been invested in it. If a limited company goes bankrupt, it is wound up and its assets are liquidated (i.e. sold) to pay the debts. If the assets don’t cover the liabilities or the debts, they remain unpaid. The creditors simply do not get all their money back.
Most companies begin as private limited companies. Their owners have to put the capital themselves, or borrow from friends or a bank, perhaps a bank specializing in venture capital. The founders have to write a Memorandum of Association ( GB) or a Certificate of Incorporation (US), which states the company’s name, its purpose, its registered office or premises, and the amount of authorized share capital. They also write Articles of Association (GB) or Bylaws (US), which set out the duties or directories and the rights of shareholders (GB) or stockholders (US). They send these documents to the registrar of companies.
A successful, growing company can apply to stock exchange to become a public limited company (GB) or a listed company (US). Newer and smallest usually join “over-the-counter” markets such as the Unlisted Securities Market in London or NASDAQ in New York. Very successful businesses can apply to be quoted or listed (i.e. to have their shares traded) on major stock exchanges. Publicly quoted companies have to fulfill a large number of requirements, including sending their shareholders an independently-audited report every year, containing the year’s trading results and a statement of their financial position.
The act of issuing shares (GB) or stocks (US) for the first time is known as floating a company ( making flotation). Companies generally use an investment bank to underwrite the issue, i.e. to guarantee to purchase all the securities at an agreed price on a certain day, if they cannot be sold to the public.
Companies wishing to raise more money for expansion can sometimes issue new share, which are normally offered first to existing shareholders at less than their market price. This is known as a rights issue. Companies sometimes also choose to capitalize part of their profit, i.e. turn it into capital, by issuing new shares to shareholders instead of paying dividends. This is known as bonus issue.
Buying a share gives its holder part of the ownership of a company. Shares generally entitle their owners to vote at a company’s Annual General Meeting (GB) or Annual Meeting of Stockholders (US), and to receive a proportion of distributed profits in a form of a dividend- or to receive part of the company’s residual value if it goes into liquidation. Shareholders can sell their shares on the secondary market at any time, but the market price of a share- the price quoted at any given time on the stock exchange, which reflects (more or less) how well or badly the company is doing- may differ radically from its nominal value.
Alternative terminology.
Americans often talk about corporations rather than companies and about an initial public offering rather than a flotation.
Another name for stocks and shares is equities, because all the stocks or shares of a company – or at least all those of a particular category – have equal value.
Two other terms for nominal value are face value and par value.
Other names for a bonus issue are a scrip issue(short for ‘subscription certificate’) and a capitalization issue, and in the US, a stock dividend or stock split.
Translation.
Компании.
Физические лица и группы людей, занимающихся бизнесом в форме партнерства, имеют неограниченные обязательства по долгам, в случае если они не формируют общество с ограниченной ответственностью. Если дела идут плохо и компания не может рассчитаться по долгам, любой кредитор может объявить её банкротом. Неуспешным бизнесменам может понадобиться продать почти всё имущество, чтобы выплатить долги. Это является причиной того, что большинство людей, занимающихся бизнесом, образуют общество с ограниченной ответственностью. Общество с ограниченной ответственностью - это юридическое лицо, отдельное от своих владельцев, и ответственное только за капитал, который был в него инвестирован. Если общество с ограниченной ответственностью становится банкротом, оно ликвидируется , и его активы продаются, чтобы погасить задолженности. Если активы не покрывают обязательства или долги, они остаются непогашенными. Кредиторам просто не возвращают полностью все их деньги.
Большинство компаний начинают как частные компании с ограниченной ответственностью.
Их владельцы должны самостоятельно создавать капитал или брать в долг у друзей или банка, возможно у банка, который специализируется на рисковом капитале. учредители должны составить Учредительный Договор, в котором указывается название компании, ее цель, ее зарегистрированный офис или здание, и количество уставного капитала. Они также составляют Устав корпорации, который устанавливает обязанности директоров и права акционеров. Они отправляют эти документы в регистратор компаний.
Успешная растущая компания может выставиться на фондовой бирже, чтобы стать открытым акционерным обществом. Новые и небольшие компании обычно присоединяются к «рынку ценных бумаг, продающихся по телефону или через компьютерную сеть», такие как Частный Рынок Ценных Бумаг в Лондоне или Nasdaq в Нью-Йорке. Очень успешные компании могут котироваться( то есть продавать свои акции) на крупнейших фондовых биржах.
Публично котируемые компании должны выполнить широкий ряд предписаний, включая ежегодное осведомление своих акционеров путём независимо-ревизованного отчёта, в котором отражаются результаты торговли и справка об их финансовом положении. Процесс выпуска облигаций или акций впервые носит название учреждения компании (создание учреждения). В большинстве случаев компании прибегают к помощи инвестиционных банков для подписания доходов, то есть гарантировать покупку всех ценных бумаг по установленной цене в определённый момент в том случае, если они не будут проданы общественности.
Компании желающие привлечь больше денежных средств путём экспансии могут выпустить новые акции, которые ,как правило, сначала предлагаются нынешним акционерам по цене ниже рыночной. Этот процесс называется выпуск новых акций. Также компании выбирают капитализацию части прибыли, путём выпуска новых акций взамен оплаты дивидендов. Это называется премиальный выпуск акций.
Покупая акцию, обладатель получает часть владения компанией. Акции, в целом, наделяют правом их обладателей голосовать на Ежегодном Всеобщем Собрании или на Ежегодной Встрече Акционеров, получить часть распределённой прибыли фирмы в виде дивидендов – или получить часть ликвидационной стоимости компании в случае её роспуска. Акционеры в праве продать свою долю на второстепенных рынках, но рыночная стоимость акции – стоимость, котируемая на фондовом рынке, отражает (в большей или меньшей степени) насколько успешна компания на данный момент – может радикально отличаться от её номинальной стоимости.
1c comprehension
Write questions that could produce the following answers.
1 They have to and their shareholders report the end of every financial year, including independently audited financial statements, and hold annual general meeting.
2 A market for young or small companies which do not want to have their shares traded on a major stock exchanges.
3 It issues new shares offering them to existing shareholders first.
4 It’s when a company chooses to issue new shares to existing shareholders rather than pay them a dividend.
5 They are generally entitled to write a companies’ General Meetings and to receive a dividend if the company makes a profit.
1d Vocabulary
Find words in the text which mean the following:
1 having responsibility or an obligation to do something, e.g. to pay a debt
2 a person or organization to whom money is owed ( for goods and services rendered or as repayment of a loan)
3 to be insolvent : unable to pay debts
4 everything of value owned by a business that can be used to produce goods, pay liabilities, and so on
5 to sell all the possessions of a bankrupt business
6 to provide money for a company or other project
7 money invested in a possibly risky new business
8 the people who begin a new company
9 the place in which a company does business: an office, shop, workshop, factory, warehouse and so on
10 to guarantee to buy an entire new share issue, if no one else wants it
11 a proportion of the annual profits of a limited company, pay to shareholders.
2c
Match the following words and definitions.
mutual fund; market maker; defensive stock; stockbroker; portfolio; insider share-dealing; growth stock; institutional investor; blue chip.
1 A company that spreads investors’ capital over a variety of securities
2 An investor’s selection of securities
3 A person who can advise investors and buy and sell shares for them
4 A stock in a large company or corporationthat is considered to be a secure investment
5 A stock – in an industry not much affected by cyclical trends – that offers a good return but only a limited chance to rise or decline in price
6 A stock – which usually has a high purchasing price and a low current rate of return – that is expected to appreciate in capital value
7 A wholesaler in stocks and shares who deals with brokers
8 Financial organizations such as pension funds and insurance companies which own most of the shares of all leading companies(over 60% and rising)
9 The use of information not known to the public to make a profit out of buying and selling shares
2d. There is a logical connection among three of the four words in each of the following groups. Which is the odd one out, and why?
1. Annual report- external auditors- financial statements- stockbroker
2. Blue chip- defensive stock- growth stock- rights issue
3. Bonus issue- dividend- over-the-counter - shareholder
4. Debt- equity- share- stock
5. Face value- market value- nominal value – par value
6. Float – liquidation- share issue- underwriter
7. Institutional investor- insurance company – liabilities- pension fund
8. Mutual fund – portfolio- risk – underwriter
Case study.
Imagine that a relative, who knows very little about finance, asks you to invest $10.000 for her in a portfolio of investments, but insists that she only wants her money invested in ‘wholly ethical companies’.
Which of the following activities would cause you to rule out a company as a possible investment?
-emitting a large quantity of CO2 into the atmosphere;
-factory farming;
-making donations to political parties;
-manufacturing weapons;
-marketing powdered baby milk in countries without pure water supplies;
-not recognizing trade unions;
-obliging retail staff to work on Sundays;
-paying low wage levels in developing countries;
-producing nuclear energy;
-selling alcohol;
-selling tobacco;
-relocating production to countries with lower labour costs;
-testing cosmetic products on animals;
-trading with oppressive regimes.
Keys:
1d
1. liability
2. creditor
3. to go bankrupt
4. assets
5. to liquidate
6. to put up the capital
7. venture capital
8. founders
9. premises
10. to underwrite the issue
11. dividend
2c
1 mutual fund
2 portfolio
3 market maker
4 defensive stock
5 blue chip
6 growth stock
7 stockbroker
8 institutional investor
9 insider share-dealing
2d
1.Stockbroker
2.Rights issue
3.Over-the-counter
4.Debt
5.Market value
6.Liquidation
7.Liabilities
8.Underwriter
Individuals, and groups of people business as a partnership, have unlimited liability for debts, unless they form a limited company. If the business does badly and cannot pay its debts, any creditor can have it declared bankrupt. The unsuccessful business people may have to sell nearly all their possessions in order to pay their debts. This is why most people doing business form limited companies. A limited company is a legal entity separate from its owners, and is only liable for the amount of capital that has been invested in it. If a limited company goes bankrupt, it is wound up and its assets are liquidated (i.e. sold) to pay the debts. If the assets don’t cover the liabilities or the debts, they remain unpaid. The creditors simply do not get all their money back.
Most companies begin as private limited companies. Their owners have to put the capital themselves, or borrow from friends or a bank, perhaps a bank specializing in venture capital. The founders have to write a Memorandum of Association ( GB) or a Certificate of Incorporation (US), which states the company’s name, its purpose, its registered office or premises, and the amount of authorized share capital. They also write Articles of Association (GB) or Bylaws (US), which set out the duties or directories and the rights of shareholders (GB) or stockholders (US). They send these documents to the registrar of companies.
A successful, growing company can apply to stock exchange to become a public limited company (GB) or a listed company (US). Newer and smallest usually join “over-the-counter” markets such as the Unlisted Securities Market in London or NASDAQ in New York. Very successful businesses can apply to be quoted or listed (i.e. to have their shares traded) on major stock exchanges. Publicly quoted companies have to fulfill a large number of requirements, including sending their shareholders an independently-audited report every year, containing the year’s trading results and a statement of their financial position.
The act of issuing shares (GB) or stocks (US) for the first time is known as floating a company ( making flotation). Companies generally use an investment bank to underwrite the issue, i.e. to guarantee to purchase all the securities at an agreed price on a certain day, if they cannot be sold to the public.
Companies wishing to raise more money for expansion can sometimes issue new share, which are normally offered first to existing shareholders at less than their market price. This is known as a rights issue. Companies sometimes also choose to capitalize part of their profit, i.e. turn it into capital, by issuing new shares to shareholders instead of paying dividends. This is known as bonus issue.
Buying a share gives its holder part of the ownership of a company. Shares generally entitle their owners to vote at a company’s Annual General Meeting (GB) or Annual Meeting of Stockholders (US), and to receive a proportion of distributed profits in a form of a dividend- or to receive part of the company’s residual value if it goes into liquidation. Shareholders can sell their shares on the secondary market at any time, but the market price of a share- the price quoted at any given time on the stock exchange, which reflects (more or less) how well or badly the company is doing- may differ radically from its nominal value.
Alternative terminology.
Americans often talk about corporations rather than companies and about an initial public offering rather than a flotation.
Another name for stocks and shares is equities, because all the stocks or shares of a company – or at least all those of a particular category – have equal value.
Two other terms for nominal value are face value and par value.
Other names for a bonus issue are a scrip issue(short for ‘subscription certificate’) and a capitalization issue, and in the US, a stock dividend or stock split.
Translation.
Компании.
Физические лица и группы людей, занимающихся бизнесом в форме партнерства, имеют неограниченные обязательства по долгам, в случае если они не формируют общество с ограниченной ответственностью. Если дела идут плохо и компания не может рассчитаться по долгам, любой кредитор может объявить её банкротом. Неуспешным бизнесменам может понадобиться продать почти всё имущество, чтобы выплатить долги. Это является причиной того, что большинство людей, занимающихся бизнесом, образуют общество с ограниченной ответственностью. Общество с ограниченной ответственностью - это юридическое лицо, отдельное от своих владельцев, и ответственное только за капитал, который был в него инвестирован. Если общество с ограниченной ответственностью становится банкротом, оно ликвидируется , и его активы продаются, чтобы погасить задолженности. Если активы не покрывают обязательства или долги, они остаются непогашенными. Кредиторам просто не возвращают полностью все их деньги.
Большинство компаний начинают как частные компании с ограниченной ответственностью.
Их владельцы должны самостоятельно создавать капитал или брать в долг у друзей или банка, возможно у банка, который специализируется на рисковом капитале. учредители должны составить Учредительный Договор, в котором указывается название компании, ее цель, ее зарегистрированный офис или здание, и количество уставного капитала. Они также составляют Устав корпорации, который устанавливает обязанности директоров и права акционеров. Они отправляют эти документы в регистратор компаний.
Успешная растущая компания может выставиться на фондовой бирже, чтобы стать открытым акционерным обществом. Новые и небольшие компании обычно присоединяются к «рынку ценных бумаг, продающихся по телефону или через компьютерную сеть», такие как Частный Рынок Ценных Бумаг в Лондоне или Nasdaq в Нью-Йорке. Очень успешные компании могут котироваться( то есть продавать свои акции) на крупнейших фондовых биржах.
Публично котируемые компании должны выполнить широкий ряд предписаний, включая ежегодное осведомление своих акционеров путём независимо-ревизованного отчёта, в котором отражаются результаты торговли и справка об их финансовом положении. Процесс выпуска облигаций или акций впервые носит название учреждения компании (создание учреждения). В большинстве случаев компании прибегают к помощи инвестиционных банков для подписания доходов, то есть гарантировать покупку всех ценных бумаг по установленной цене в определённый момент в том случае, если они не будут проданы общественности.
Компании желающие привлечь больше денежных средств путём экспансии могут выпустить новые акции, которые ,как правило, сначала предлагаются нынешним акционерам по цене ниже рыночной. Этот процесс называется выпуск новых акций. Также компании выбирают капитализацию части прибыли, путём выпуска новых акций взамен оплаты дивидендов. Это называется премиальный выпуск акций.
Покупая акцию, обладатель получает часть владения компанией. Акции, в целом, наделяют правом их обладателей голосовать на Ежегодном Всеобщем Собрании или на Ежегодной Встрече Акционеров, получить часть распределённой прибыли фирмы в виде дивидендов – или получить часть ликвидационной стоимости компании в случае её роспуска. Акционеры в праве продать свою долю на второстепенных рынках, но рыночная стоимость акции – стоимость, котируемая на фондовом рынке, отражает (в большей или меньшей степени) насколько успешна компания на данный момент – может радикально отличаться от её номинальной стоимости.
1c comprehension
Write questions that could produce the following answers.
1 They have to and their shareholders report the end of every financial year, including independently audited financial statements, and hold annual general meeting.
2 A market for young or small companies which do not want to have their shares traded on a major stock exchanges.
3 It issues new shares offering them to existing shareholders first.
4 It’s when a company chooses to issue new shares to existing shareholders rather than pay them a dividend.
5 They are generally entitled to write a companies’ General Meetings and to receive a dividend if the company makes a profit.
1d Vocabulary
Find words in the text which mean the following:
1 having responsibility or an obligation to do something, e.g. to pay a debt
2 a person or organization to whom money is owed ( for goods and services rendered or as repayment of a loan)
3 to be insolvent : unable to pay debts
4 everything of value owned by a business that can be used to produce goods, pay liabilities, and so on
5 to sell all the possessions of a bankrupt business
6 to provide money for a company or other project
7 money invested in a possibly risky new business
8 the people who begin a new company
9 the place in which a company does business: an office, shop, workshop, factory, warehouse and so on
10 to guarantee to buy an entire new share issue, if no one else wants it
11 a proportion of the annual profits of a limited company, pay to shareholders.
2c
Match the following words and definitions.
mutual fund; market maker; defensive stock; stockbroker; portfolio; insider share-dealing; growth stock; institutional investor; blue chip.
1 A company that spreads investors’ capital over a variety of securities
2 An investor’s selection of securities
3 A person who can advise investors and buy and sell shares for them
4 A stock in a large company or corporationthat is considered to be a secure investment
5 A stock – in an industry not much affected by cyclical trends – that offers a good return but only a limited chance to rise or decline in price
6 A stock – which usually has a high purchasing price and a low current rate of return – that is expected to appreciate in capital value
7 A wholesaler in stocks and shares who deals with brokers
8 Financial organizations such as pension funds and insurance companies which own most of the shares of all leading companies(over 60% and rising)
9 The use of information not known to the public to make a profit out of buying and selling shares
2d. There is a logical connection among three of the four words in each of the following groups. Which is the odd one out, and why?
1. Annual report- external auditors- financial statements- stockbroker
2. Blue chip- defensive stock- growth stock- rights issue
3. Bonus issue- dividend- over-the-counter - shareholder
4. Debt- equity- share- stock
5. Face value- market value- nominal value – par value
6. Float – liquidation- share issue- underwriter
7. Institutional investor- insurance company – liabilities- pension fund
8. Mutual fund – portfolio- risk – underwriter
Case study.
Imagine that a relative, who knows very little about finance, asks you to invest $10.000 for her in a portfolio of investments, but insists that she only wants her money invested in ‘wholly ethical companies’.
Which of the following activities would cause you to rule out a company as a possible investment?
-emitting a large quantity of CO2 into the atmosphere;
-factory farming;
-making donations to political parties;
-manufacturing weapons;
-marketing powdered baby milk in countries without pure water supplies;
-not recognizing trade unions;
-obliging retail staff to work on Sundays;
-paying low wage levels in developing countries;
-producing nuclear energy;
-selling alcohol;
-selling tobacco;
-relocating production to countries with lower labour costs;
-testing cosmetic products on animals;
-trading with oppressive regimes.
Keys:
1d
1. liability
2. creditor
3. to go bankrupt
4. assets
5. to liquidate
6. to put up the capital
7. venture capital
8. founders
9. premises
10. to underwrite the issue
11. dividend
2c
1 mutual fund
2 portfolio
3 market maker
4 defensive stock
5 blue chip
6 growth stock
7 stockbroker
8 institutional investor
9 insider share-dealing
2d
1.Stockbroker
2.Rights issue
3.Over-the-counter
4.Debt
5.Market value
6.Liquidation
7.Liabilities
8.Underwriter
The banking industry
(Reading)
Read the text below and write short headings (one or two words) for each paragraph.
Types of banking
1…………………………………………..
Commercial or retail banks are businesses that trade in money. They receive and hold deposits, pay money according to customers’ instructions, lend money, offer investment advice, exchange foreign currencies, and so on. They make a profit from difference (known as spread or margin) between the interest rates they pay to lenders or depositors and those they charge to borrowers. Banks also create credit because the money they lend from the deposits is generally spent (either on goods or services or to settle debts), and in this way transferred to another bank account – often by way of a bank transferee or a cheque (check) rather than they use of notes or coins – from where it can be lend to another borrower, and so on. When lending money, bankers have to find a balance between yield and risk and between liquidity a different maturities.
2………………………………………………
Merchant banks in Britain raise funds for industry on the various financial markets, finance international trade, issuer and underwrite securities, deal with take overs and mergers, and issue government bonds. They also generally offer stockbroking and portfolio management services to reach corporate and individual clients. Investment banks in the USA are similar, but they can only act as intermediaries offering advisory service, and do not offer loans themselves. Investment banks make their profits from the fees and commissions they charge for their services.
3……………………………………………..
In the USA, the Glass-Steagall act of 1944 enforced a strict separation between commercial banks and investment banks or stockbroking firms. Eat the distinction between commercial and investment banking has become less clear in recent years. Deregulation in the USA and Britain is leading to the creation of “financial supermarkets”: conglomerates combining the services previously offered by banks, stockbrokers, insurance companies, and so on. In some European countries» notable Germany, Austria and Switzerland” they have always been universal banks combining deposit and loan banking with share and bond dealing and investment services.
4………………………………………………
A country’ minimum interest rate is usually fixed by the central bank this is the discount rate, at which the central bank maces secured loans to commercial banks. Banks lend to blue cheap borrowers “very safe large companies” at the base rate or the prime rate; all other borrowers pay more, depending on their credit standing (or credit rating, or credit worthiness): the lenders estimation of their present and future solvency borrowers can usually get a lower interest rate if the loan is secured or guaranteed by some kind of asset known as collateral.
5……………………………………………….
In most financial centers, there also branches of lots of foreign banks, largely doing Eurocurrency business a Eurocurrency is any currency had outside its country of origin. The first significant Eurocurrency market was for USA dollars in Europe, but the name is now used for foreign currencies held anywhere in the world (egg. Yen in the USA, DM in Japan). Since the USA dollars is the world’s most important trading currency – and because the USA has for many years had a huge trade deficit – there is a market of many billions of Eurodollars, including the oil exporting countries “Petrodollars”. Although a central bank can determine the minimum lending rate for its national currency it has no control over foreign currencies. Furthermore, banks are not obliged to deposit any of their Eurocurrency assets at zero percent interest with the central bank, which means that they can usually offer better rates to borrowers and depositors than in the home country.
1a Vocabulary
Match up these terms with the definition below.
Cash card cash dispenser credit card home banking loan mortgage overdraft standing order current account (GB) or checking account (US) deposit account (GB) or time or notice account (US)
1. an arrangement by which a customer can withdraw more from a bank account than has been deposited in it, up to an agreed limit; interest on the debt is calculated daily.
2. a card which guarantees payment of goods and services purchased by the cardholder, who pays back the bank or finance company at a later date
3. a computerized machine that allows bank customers to withdraw money, check, their balance and so on
4. a fixed sum of money on which interest is paid, lent for a fixed period, and usually for a specific purpose
5. an instruction to a bank to pay fixed sums of money to certain people or organizations at stated times
6. a loan, usually to buy property, which serves as a security for the loan
7. a plastic card issued to bank customers for use in cash dispensers
8. doing banking transactions by telephone or from one’s own personal computer, linked to the bank via a network
9. one that generally pays little or no interest, but allows the holder to withdraw his or her cash without any restrictions
10. one that pays interest, but usually cannot be used for paying chouse (GB) or checks (US), and on which notice is often required to withdraw money.
1b Discussion
1 Which of the banking facilities listed I 1a do you use?
2 What other services do commercial banks offer in your country?
3 What changes have there been in personal banking recently?
4 What further changes do you foresee in the future?
2b Comprehension
Which the following there paragraphs most accurately and concisely summarizes the text, and what is wrong with the others?
First summary:
Commercial banks hold customers’ deposits and make loans. Investment banks raise funds for industry. Deregulation in Britain and the US is leading to the creation of financial conglomerates similar to the universal banks that have always existed I German-speaking countries. A countries’ minimum interest rate is usually fixed; banks charge progressively higher rates to less secure borrowers. Many banks also do Eurocurrency business – lending foreign currencies, notably dollars, at lower rate than in the currencies’ home countries.
Second summary:
Commercial banks hold deposits and make loans. Merchants and investment banks arrange security issues and offer other investment services. Yet the traditional distinction between commercial and investment banks is now breaking down. Domestic interest rates are fixed by central banks. Many banks also have branches abroad that do Eurocurrencies business, making loans in other European currencies.
Third summary:
Commercial banks receive deposits, lend money, and provide other services. Merchant and investment banks lend money to industry. British and American banks are now joining together in conglomerates. The interest rates that banks charge depend on the borrowers’ creditworthiness. European banks also do a lot of Eurodollar and petrodollar business.
Translation:
Bancile comerciale detin controlul asupra depozitelor clientilor si ofera imprumuturi.Bancile de investitii maresc fondurile pentru industrie. Neregulele din Marea Britanie si SUA duc la crearea conglomeratelor financiare, asemanator cu bancile universale care au existat intotdeauna in tarile vorbitoare in limba germana. Dobinda minima a unei tari este de obicei fixa; bancile taxeaza dobinda progresiv creschinda pentru imprumuturile mai putin sigure. Multe banci conduc afaceri in valuta Euro-imprumutind valuta straina, in special dolari, la dobinzi mai mici decit in tarile de provenienta a valutei;
Bancile comerciale accepta depozita si dau imprumuturi. Comerciantul si bancile de investitii aranjeaza probleme de securitate si ofera alte servicii de investitii. Diferenta traditionala dintre bancile comerciale si bancile de investitii se descompune. Dobinzile din interiorul tarii sunt determinate de bancile centrale. Multe banci de asemenea au filiale prin strainatate, care conduc afaceri in valuta Euro oferind imprumturi in alte valute europene.
Bancile comerciale primesc depozite, imprumuta bani si presteaza alte servicii. Bancile comerciale si de investitii imprumuta bani in industrie. Bancile engleze si americane se unesc in conglomerate. Dobinzele pe care le impugn bancile depind de bonitatea celui care imprumuta banii. Bancile europene de asemenea conduc foarte multe afaceri euro-dollar si petrodollar.
2c Vocabulary
Find the words or expressions in the text 2a which the following.
1 to place money in a bank; or money placed in a bank
2 the money used in countries other than one’s own
3 how much money a loan pays, expressed as a percentage
4 available cash, and how easily other assets can be turned into cash
5 the date when a loan becomes repayable
6 to guarantee to buy all the new shares that a company issues, if they can not be sold to the public
7 when a company buys or acquires another one
8 when a company combines with another one
9 buying and selling stocks or shares for clients
10 taking care of all a client’s investments
11 the ending or relaxing of legal restrictions
12 a group of companies, operating in different fields, that have joined together
13 a company considered to be without risk
14 ability to pay liabilities when they become due
15 anything that acts as a security or a guarantee for a loan
2d Vocabulary
The text in 2a contains a number of common verb-noun partnerships (e.g. to lend money, to finance international trade). Match up the verbs and nouns below to make common collocations.
Charge advice
Do bonds
Exchange business
Issue currencies
Make deposits
Offer funds
Pay interest
Raise loans
Receive profits
Underwrite security issues
Role Play
Three different groups of inexperienced young business people in a small town require capital for the businesses. They apply to the local branch of Megabank.
The three groups of would – be borrowers must develop financial arguments that they think will convince the bankers. The group preparing the role of the bankers has to think off questions about the viability of the future businesses: will they be successful, and why? Or why might they not be successful?
The roles are:
1 A junior manager (and assistants) at the bank, responsible for new local small businesses. To lend or to lend, that is the question.
2 A group of young people who want to open a small specialist shop selling CDs of black music – jazz, soul, funk, reggae, rap, house, and any new trends.
3 A group of young people who want to buy an existing take – away pizza business (the lease on the premises, kitchens, the delivery scoters, and so on). The business is profitable and well known in the town, with loyal customers. The new owners can keep the same telephone number, and either keep or change the name.
4 A group of students who already operate a part time computing consultancy service, advising small businesses on what hardware and software to buy, and how to set up and Internet home page. They want to borrow money to buy more computers fore themselves, on which to try out elaborate new software programs.
Your teacher will give you further details about the roles (from the Teacher’s Book). You have to prepare your questions or arguments in a group, after with one or two members of the groups of borrowers will be chosen to negotiate with the bankers.
Key words:
1a
1. overdraft
2. credit card
3. cash dispenser
4. loan
5. standing order
6. mortgage
7. cash card
8. home banking
9. current account
10. deposit account
2c.
1. deposit
2. Eurocurrency
3. interest rate
4. liquidity
5. maturity
6. underwrite securities
7. takeover
8. merger
9. stock broking
10. offering portfolio management
11. deregulation
12. conglomerate
13. blue chip borrowed
14. solvency
15. collateral asset
2d
1. charge – interest
2. do – business
3. exchange – currency
4. issue – bonds
5. make – profits
6. offer – advice
7. pay – loans
8. raise – found
9. receive – deposits
10. underwrite - security issues
..................................................
Băncile comerciale din Marea Britanie strânge fonduri pentru industrie, pe diverse pieţe financiare, finanţarea comerţului internaţional, eliberarea şi subscrie titluri de valoare, se ocupă cu preluari si fuziuni, şi emite obligatiuni de stat.Ele ofera de asemenea , în general,servicii bursiere şi de gestionare a portofoliului pentru clienţi corporativi şi individuali bogat. Băncile de investiţii din Statele Unite ale Americii sunt similare, dar acestea pot acţiona numai ca intermediari care oferă servicii de consultanţă, şi nu oferă împrumuturi ei înşişi. Bancile de investitii fac profiturile lor din taxe şi comisioane le percepe pentru serviciile lor
...................................................
In Statele Unite, actul de Glass-Steagal din 1934 a pus in aplicare o separare strictă între băncile comerciale şi băncile de investiţii sau firme bursiere.Insa distincţia dintre bancile comerciale si de investitii a devenit mai puţin clar în ultimii ani. Dereglementarea în SUA şi în Marea Britanie conduce la crearea de supermarketuri financiare: conglomerate combinind serviciilor oferite anterior de către bănci, brokeri, companii de asigurări,si asa mai departe .Astfel unele ţări europene (în special Germania, Austria şi Elveţia) au fost întotdeauna băncile universale combinind depozitul şi creditul bancar cu o cota si ocupinduse de obligatiuni si servicii de investitii.
..................................................
Rata minimă a dobânzii unei ţări este fixată de obicei de către banca centrală. aceasta este rata de discount, la care banca centrală face garantate împrumuturi pentru băncile comerciale .Bancile comerciale împrumuta debitorilor blue chip (companii foarte mari în condiţii de siguranţă) la rata de bază sau rata de prima ; toti alţi împrumutători plătesc mai mult, în funcţie de bonitatea lor (sau de rating de credit, sau bonitatea): estimarea creditor de solvabilitate lor prezente şi viitoare. Debitorii pot obţine, de obicei, o rată a dobânzii mai mica în cazul în care împrumutul este securizat sau garantat de către unele active fel , cunoscut sub numele de garanţie.
.................................................
In cele mai multe centre financiare, există, de asemenea, o mulţime de filiale ale unor bănci străine, care în mare măsură fac afaceri in Eurocurrency. Eurocurrency este orice valuta deţinuta în afara ţării sale de origine. prima piaţă semnificativă pentru eurocurrency a fost de dolari SUA în Europa, dar numele este utilizată în prezent pentru monede străine care sint detinute oriunde in lume (yeni în SUA, DM în Japonia). Deoarece dolarul US este moneda comerciala cea mai importanta - şi pentru că SUA are de mulţi ani a avut un deficit comercial uriaş - există o piaţă de multe miliarde de Eurodollari, inclusiv ţările exportatoare de petrol „petrodolari” Deşi o bancă centrală poate determina rata minima de imprumut pentru moneda sa naţională nu are nici un control asupra valutei straine. In plus, băncile nu sunt obligate să depună pentru oricare din activele Eurocurrency lor la 0% dobândă cu banca centrală, ceea ce înseamnă că le pot oferi, de obicei, rate mai bune de la debitori şi deponenţilor decât în ţara de origine.
Butmalai Ion/ Vodeaniuc Vadim
(Reading)
Read the text below and write short headings (one or two words) for each paragraph.
Types of banking
1…………………………………………..
Commercial or retail banks are businesses that trade in money. They receive and hold deposits, pay money according to customers’ instructions, lend money, offer investment advice, exchange foreign currencies, and so on. They make a profit from difference (known as spread or margin) between the interest rates they pay to lenders or depositors and those they charge to borrowers. Banks also create credit because the money they lend from the deposits is generally spent (either on goods or services or to settle debts), and in this way transferred to another bank account – often by way of a bank transferee or a cheque (check) rather than they use of notes or coins – from where it can be lend to another borrower, and so on. When lending money, bankers have to find a balance between yield and risk and between liquidity a different maturities.
2………………………………………………
Merchant banks in Britain raise funds for industry on the various financial markets, finance international trade, issuer and underwrite securities, deal with take overs and mergers, and issue government bonds. They also generally offer stockbroking and portfolio management services to reach corporate and individual clients. Investment banks in the USA are similar, but they can only act as intermediaries offering advisory service, and do not offer loans themselves. Investment banks make their profits from the fees and commissions they charge for their services.
3……………………………………………..
In the USA, the Glass-Steagall act of 1944 enforced a strict separation between commercial banks and investment banks or stockbroking firms. Eat the distinction between commercial and investment banking has become less clear in recent years. Deregulation in the USA and Britain is leading to the creation of “financial supermarkets”: conglomerates combining the services previously offered by banks, stockbrokers, insurance companies, and so on. In some European countries» notable Germany, Austria and Switzerland” they have always been universal banks combining deposit and loan banking with share and bond dealing and investment services.
4………………………………………………
A country’ minimum interest rate is usually fixed by the central bank this is the discount rate, at which the central bank maces secured loans to commercial banks. Banks lend to blue cheap borrowers “very safe large companies” at the base rate or the prime rate; all other borrowers pay more, depending on their credit standing (or credit rating, or credit worthiness): the lenders estimation of their present and future solvency borrowers can usually get a lower interest rate if the loan is secured or guaranteed by some kind of asset known as collateral.
5……………………………………………….
In most financial centers, there also branches of lots of foreign banks, largely doing Eurocurrency business a Eurocurrency is any currency had outside its country of origin. The first significant Eurocurrency market was for USA dollars in Europe, but the name is now used for foreign currencies held anywhere in the world (egg. Yen in the USA, DM in Japan). Since the USA dollars is the world’s most important trading currency – and because the USA has for many years had a huge trade deficit – there is a market of many billions of Eurodollars, including the oil exporting countries “Petrodollars”. Although a central bank can determine the minimum lending rate for its national currency it has no control over foreign currencies. Furthermore, banks are not obliged to deposit any of their Eurocurrency assets at zero percent interest with the central bank, which means that they can usually offer better rates to borrowers and depositors than in the home country.
1a Vocabulary
Match up these terms with the definition below.
Cash card cash dispenser credit card home banking loan mortgage overdraft standing order current account (GB) or checking account (US) deposit account (GB) or time or notice account (US)
1. an arrangement by which a customer can withdraw more from a bank account than has been deposited in it, up to an agreed limit; interest on the debt is calculated daily.
2. a card which guarantees payment of goods and services purchased by the cardholder, who pays back the bank or finance company at a later date
3. a computerized machine that allows bank customers to withdraw money, check, their balance and so on
4. a fixed sum of money on which interest is paid, lent for a fixed period, and usually for a specific purpose
5. an instruction to a bank to pay fixed sums of money to certain people or organizations at stated times
6. a loan, usually to buy property, which serves as a security for the loan
7. a plastic card issued to bank customers for use in cash dispensers
8. doing banking transactions by telephone or from one’s own personal computer, linked to the bank via a network
9. one that generally pays little or no interest, but allows the holder to withdraw his or her cash without any restrictions
10. one that pays interest, but usually cannot be used for paying chouse (GB) or checks (US), and on which notice is often required to withdraw money.
1b Discussion
1 Which of the banking facilities listed I 1a do you use?
2 What other services do commercial banks offer in your country?
3 What changes have there been in personal banking recently?
4 What further changes do you foresee in the future?
2b Comprehension
Which the following there paragraphs most accurately and concisely summarizes the text, and what is wrong with the others?
First summary:
Commercial banks hold customers’ deposits and make loans. Investment banks raise funds for industry. Deregulation in Britain and the US is leading to the creation of financial conglomerates similar to the universal banks that have always existed I German-speaking countries. A countries’ minimum interest rate is usually fixed; banks charge progressively higher rates to less secure borrowers. Many banks also do Eurocurrency business – lending foreign currencies, notably dollars, at lower rate than in the currencies’ home countries.
Second summary:
Commercial banks hold deposits and make loans. Merchants and investment banks arrange security issues and offer other investment services. Yet the traditional distinction between commercial and investment banks is now breaking down. Domestic interest rates are fixed by central banks. Many banks also have branches abroad that do Eurocurrencies business, making loans in other European currencies.
Third summary:
Commercial banks receive deposits, lend money, and provide other services. Merchant and investment banks lend money to industry. British and American banks are now joining together in conglomerates. The interest rates that banks charge depend on the borrowers’ creditworthiness. European banks also do a lot of Eurodollar and petrodollar business.
Translation:
Bancile comerciale detin controlul asupra depozitelor clientilor si ofera imprumuturi.Bancile de investitii maresc fondurile pentru industrie. Neregulele din Marea Britanie si SUA duc la crearea conglomeratelor financiare, asemanator cu bancile universale care au existat intotdeauna in tarile vorbitoare in limba germana. Dobinda minima a unei tari este de obicei fixa; bancile taxeaza dobinda progresiv creschinda pentru imprumuturile mai putin sigure. Multe banci conduc afaceri in valuta Euro-imprumutind valuta straina, in special dolari, la dobinzi mai mici decit in tarile de provenienta a valutei;
Bancile comerciale accepta depozita si dau imprumuturi. Comerciantul si bancile de investitii aranjeaza probleme de securitate si ofera alte servicii de investitii. Diferenta traditionala dintre bancile comerciale si bancile de investitii se descompune. Dobinzile din interiorul tarii sunt determinate de bancile centrale. Multe banci de asemenea au filiale prin strainatate, care conduc afaceri in valuta Euro oferind imprumturi in alte valute europene.
Bancile comerciale primesc depozite, imprumuta bani si presteaza alte servicii. Bancile comerciale si de investitii imprumuta bani in industrie. Bancile engleze si americane se unesc in conglomerate. Dobinzele pe care le impugn bancile depind de bonitatea celui care imprumuta banii. Bancile europene de asemenea conduc foarte multe afaceri euro-dollar si petrodollar.
2c Vocabulary
Find the words or expressions in the text 2a which the following.
1 to place money in a bank; or money placed in a bank
2 the money used in countries other than one’s own
3 how much money a loan pays, expressed as a percentage
4 available cash, and how easily other assets can be turned into cash
5 the date when a loan becomes repayable
6 to guarantee to buy all the new shares that a company issues, if they can not be sold to the public
7 when a company buys or acquires another one
8 when a company combines with another one
9 buying and selling stocks or shares for clients
10 taking care of all a client’s investments
11 the ending or relaxing of legal restrictions
12 a group of companies, operating in different fields, that have joined together
13 a company considered to be without risk
14 ability to pay liabilities when they become due
15 anything that acts as a security or a guarantee for a loan
2d Vocabulary
The text in 2a contains a number of common verb-noun partnerships (e.g. to lend money, to finance international trade). Match up the verbs and nouns below to make common collocations.
Charge advice
Do bonds
Exchange business
Issue currencies
Make deposits
Offer funds
Pay interest
Raise loans
Receive profits
Underwrite security issues
Role Play
Three different groups of inexperienced young business people in a small town require capital for the businesses. They apply to the local branch of Megabank.
The three groups of would – be borrowers must develop financial arguments that they think will convince the bankers. The group preparing the role of the bankers has to think off questions about the viability of the future businesses: will they be successful, and why? Or why might they not be successful?
The roles are:
1 A junior manager (and assistants) at the bank, responsible for new local small businesses. To lend or to lend, that is the question.
2 A group of young people who want to open a small specialist shop selling CDs of black music – jazz, soul, funk, reggae, rap, house, and any new trends.
3 A group of young people who want to buy an existing take – away pizza business (the lease on the premises, kitchens, the delivery scoters, and so on). The business is profitable and well known in the town, with loyal customers. The new owners can keep the same telephone number, and either keep or change the name.
4 A group of students who already operate a part time computing consultancy service, advising small businesses on what hardware and software to buy, and how to set up and Internet home page. They want to borrow money to buy more computers fore themselves, on which to try out elaborate new software programs.
Your teacher will give you further details about the roles (from the Teacher’s Book). You have to prepare your questions or arguments in a group, after with one or two members of the groups of borrowers will be chosen to negotiate with the bankers.
Key words:
1a
1. overdraft
2. credit card
3. cash dispenser
4. loan
5. standing order
6. mortgage
7. cash card
8. home banking
9. current account
10. deposit account
2c.
1. deposit
2. Eurocurrency
3. interest rate
4. liquidity
5. maturity
6. underwrite securities
7. takeover
8. merger
9. stock broking
10. offering portfolio management
11. deregulation
12. conglomerate
13. blue chip borrowed
14. solvency
15. collateral asset
2d
1. charge – interest
2. do – business
3. exchange – currency
4. issue – bonds
5. make – profits
6. offer – advice
7. pay – loans
8. raise – found
9. receive – deposits
10. underwrite - security issues
..................................................
Băncile comerciale din Marea Britanie strânge fonduri pentru industrie, pe diverse pieţe financiare, finanţarea comerţului internaţional, eliberarea şi subscrie titluri de valoare, se ocupă cu preluari si fuziuni, şi emite obligatiuni de stat.Ele ofera de asemenea , în general,servicii bursiere şi de gestionare a portofoliului pentru clienţi corporativi şi individuali bogat. Băncile de investiţii din Statele Unite ale Americii sunt similare, dar acestea pot acţiona numai ca intermediari care oferă servicii de consultanţă, şi nu oferă împrumuturi ei înşişi. Bancile de investitii fac profiturile lor din taxe şi comisioane le percepe pentru serviciile lor
...................................................
In Statele Unite, actul de Glass-Steagal din 1934 a pus in aplicare o separare strictă între băncile comerciale şi băncile de investiţii sau firme bursiere.Insa distincţia dintre bancile comerciale si de investitii a devenit mai puţin clar în ultimii ani. Dereglementarea în SUA şi în Marea Britanie conduce la crearea de supermarketuri financiare: conglomerate combinind serviciilor oferite anterior de către bănci, brokeri, companii de asigurări,si asa mai departe .Astfel unele ţări europene (în special Germania, Austria şi Elveţia) au fost întotdeauna băncile universale combinind depozitul şi creditul bancar cu o cota si ocupinduse de obligatiuni si servicii de investitii.
..................................................
Rata minimă a dobânzii unei ţări este fixată de obicei de către banca centrală. aceasta este rata de discount, la care banca centrală face garantate împrumuturi pentru băncile comerciale .Bancile comerciale împrumuta debitorilor blue chip (companii foarte mari în condiţii de siguranţă) la rata de bază sau rata de prima ; toti alţi împrumutători plătesc mai mult, în funcţie de bonitatea lor (sau de rating de credit, sau bonitatea): estimarea creditor de solvabilitate lor prezente şi viitoare. Debitorii pot obţine, de obicei, o rată a dobânzii mai mica în cazul în care împrumutul este securizat sau garantat de către unele active fel , cunoscut sub numele de garanţie.
.................................................
In cele mai multe centre financiare, există, de asemenea, o mulţime de filiale ale unor bănci străine, care în mare măsură fac afaceri in Eurocurrency. Eurocurrency este orice valuta deţinuta în afara ţării sale de origine. prima piaţă semnificativă pentru eurocurrency a fost de dolari SUA în Europa, dar numele este utilizată în prezent pentru monede străine care sint detinute oriunde in lume (yeni în SUA, DM în Japonia). Deoarece dolarul US este moneda comerciala cea mai importanta - şi pentru că SUA are de mulţi ani a avut un deficit comercial uriaş - există o piaţă de multe miliarde de Eurodollari, inclusiv ţările exportatoare de petrol „petrodolari” Deşi o bancă centrală poate determina rata minima de imprumut pentru moneda sa naţională nu are nici un control asupra valutei straine. In plus, băncile nu sunt obligate să depună pentru oricare din activele Eurocurrency lor la 0% dobândă cu banca centrală, ceea ce înseamnă că le pot oferi, de obicei, rate mai bune de la debitori şi deponenţilor decât în ţara de origine.
Butmalai Ion/ Vodeaniuc Vadim
Subscribe to:
Posts (Atom)