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§ Try to give their definitions in English.
§ In pairs make dialogues using expressions from the list above. Read the dialogues aloud.
Pre-Reading task
Scan the text. Find the main idea of the text.
Reading
Read and translate the text.
The Role Of Banks
The following story is going to explain the role of banks. In the past most societies used different objects as money. Some of these were valuable because they were rare and beautiful, others- because they could be eaten or used. Early forms of money like these were used to buy goods. They were also used to pay for marriages, fines and debts. But although everyday objects were extremely practical kinds of cash in many ways, they had some disadvantages, too. For example, it was difficultto measure their value accurately, divide some of them into a -wide range of amounts, keep some of them for a long time; use them to make financial plans for the future. For reasons such as these, some societies began to use another kind of money, that is, precious metals.
People used gold, gold bullion, as money. Those were dangerous times, and people wanted a safe place to keep their gold. So they deposited it with goldsmiths, people who worked with gold for jewellery and so on and also had a guarded vault to keep it safe in. And when people wanted some of their gold to pay for things with, they went and fetched it from the goldsmith.
Two developments turned these goldsmiths into bankers. The first was that people found it a lot easier to give the seller a letter than it was to fetch some gold and then physically hand it over to him. This letter transferred some of the gold they bag at the goldsmith's to the seller. This letter we would nowadays call a cheque. And, of course, once these letters or cheques, became acceptable as a way of paying for goods, people felt that the gold they had deposited with the goldsmith, was just as good as gold in their own pockets. And as letters or cheques, were easier to carry around than gold, and a lot less dangerous, people started to say that their money holdings were what they had with them plus their deposits. So a system of deposits was started. The second development was that goldsmiths realized they had a great deal of unused gold lying in their vaults doing nothing. This development was actually of greater importance than the first.
Now let's turn to the first bank loan ever and see what happened. A firm asked a goldsmith for a loan. The goldsmith realized that some of the gold in his vault could be lent to the firm, and of course he asked the firm to pay it back later with a little interest. Of course, at that moment the goldsmith was short of gold, it wasn't actually his gold, but he reckoned it was unlikely that everyone who had deposited gold with him would want it back at the same time, at any rate - not before the firm had repaid him his gold with a little interest. He thought it safe enough.
To understand what actually happened in this simple transaction let's consider the following table.
| Assets | Liabilities | |
| 1. Old-fashioned goldsmith 2. Gold lender 3. Deposit lender Step 1 4. Deposit lender Step 2 | Gold $100 Gold $90 + loan 10 Gold $l00 + loan $10 Gold $90+loan $10 | Deposits $100 Deposits $100 Deposits $110 Deposits $100 |
The first row shows what the goldsmith did before he made this loan. He had a hundred dollars of gold, which he owed to the people who had deposited it with him, so his assets and liabilities were the same. But when he lent, say, $10 of gold to the firm, he actually had only $90 of gold in his vault plus the value of his loan. His assets still equaled his liabilities, but he was going to get some interest.
Now let's turn to the question of reserves. Reserves are the amount of gold that is immediately available in the vault to meet depositors' demands. People originally deposited $100 of gold with the goldsmith. The goldsmith lent $10, leaving himself with $90. As a banker he was relying on the fact that not everyone would want their gold back at the same time. If they had done, be couldn't have paid out. His reserves of $90 were not enough.
The goldsmith in the table has a 100% reserve ratio. The reserve ratio is the ratio of reserves to deposits. Once he has made his loan, he has a 90% deposit ratio. This is a small risk with a small profit. How much dare he lend out in order to make a profit through his interest charges? What are the risks involved? Suppose the goldsmith took too much of a risk. He lent 80% of the gold he had. This panicked people. They doubted he could pay them all back; he was bound to lose some of the gold he had lent, so they rushed to get their gold back before it was too late. That was what we would now call a run on the bank, a financial panic. And the financial panic leads to exactly what people fear: the bank cannot pay them, goes bankrupt, and they go bankrupt as well.
Work with the text
§ Find words with the opposite meaning to the words in bold.
§ Make sentences with these words.
Translate from Russian into English:
§ В прошлом большинство типов общества использовали для обмена не только деньги.
§ Но хотя повседневные объекты были на практике очень удобны в применении, они имели некоторые недостатки, тоже.
§ Те времена были опасным, и люди хотели, чтобы у них были сейфы для хранения золота.
§ С этого момента началась система вкладов.
§ Ювелиры поняли, что некоторую часть золота из его хранилища можно было бы сдать в фирму, при условии, конечно, чтобы фирма вернула ему вклад позже с небольшим процентом.
§ Резервы являются суммой золота, которое в любое время доступно и находится в хранилище, для того, чтобы удовлетворять требования депонентов.
PROJECT WORK
§ Make a kind of survey in the Internet or scientific journals on the topic.
§ Write a short article or report.
§ Present your report to your peers using a plan, scheme or diagram.
§ Discuss other presentations and make notes.
§ Write special terms to your personal glossary.
TEST
1. The crucial feature ofmoney is its acceptance as ……….
a) the means of payment.
b) the means of medium of exchange.
c) the means of payment оr medium of exchange.
2. In Russia prices are quoted in.……….. .
d) any currency.
e) roubles.
f) euros and dollars.
3. But money is …………. the best store of value.
d) only.
e) not.
f) neither the only nor necessarily.
4. In the 19th century money was mainly ……… .
d) gold and silver coins.
e) wood and plastic sticks.
f) jewelleries.
5. Society enforces the use of token money by making it ……… .
d) legal tender.
e) public tender.
f) private choice.
6. In the past most societies used different objects as money. Some of these were valuable because they were rare and beautiful, others – because ……….
a) they were expensive to make.
b) they were difficult to make.
c) they could be eaten or used.
7. …………… are the amount of gold that is immediately available in the vault to meet depositors' demands.
a) Accounts.
b) Reserves.
c) Bills.
IV. QUALITY
UNIT 1
Lead in
§ Try to explain want is quality?
§ Do the quality of products and services influence the quality of our life?
§ Give examples.
Discussion
§ Divide in two groups.
§ Defend two opposite ideas: “the higher price the higher quality”, “the level of price is not connected with the level of quality”. Give examples.
§ Discuss your ideas.
Vocabulary
§ Read and translate new words and expressions using a dictionary.
Дата: 2016-09-30, просмотров: 232.