2. Fill in the gaps with the words and expressions from the text

1. In the past most societies used different objects as __ to buy __, to pay for __.

2. Some of these were valuable because they were __, others - because they __.

3. People used gold, __, as money.

4. People __ their gold with __, people who __ also had __ to keep gold safe in.

5. When people wanted some of their gold to __, they went and __ it from the goldsmith.

6. People found it a lot easier __ the seller __, that we would nowadays call __, than it was __ some gold and then __ to him.

7. Once these letters or cheques, became __ as a way of __ for goods, people felt that the gold they __ with the goldsmith, was just __ as gold in their own __.

8. People started to say that their __ were what they __ plus their __.

9. Goldsmiths realized they had a great deal of __ lying in their vaults __.

10. This development was actually of __ than the first.

11. At the moment of his first loan the goldsmith __, it wasn't actually __ gold, but he __ it was __ that everyone who __ gold with him would want it back __.

12. The third row shows that although the goldsmith's __ were the same, but __ $110, not $100.

13. When the firm __ for $10, and that person came in __ his $10 worth of gold, the goldsmith's __.

14. It made __ to the goldsmith whether his __ was in __ or in a form of__.

15. Reserves are the amount of gold that is __ to meet __.

16. As a banker he __ the fact that __ would want their gold __ at the same time.

17. The reserve ratio is the ratio of __ to __.

18. How much __ he lend out in order to __ through __?

19. People __ he could pay them all back, he __ to lose some of the gold he had lent, so they __ to get their gold back before __.

20. The __ or __, leads to exactly what people __: the bank cannot __ them, __, and they __ as well.

3. Find in the text English equivalents for the following

використовувати золото (злитки) як гроші; віддавати на збереження; золотих справ майстер; (банківське) сховище (підвал, який охороняється); забирати в майстра; стали прийматися як платіж за товари; невикористоване золото; залишивши собі тільки 90 доларів; проста угода; невеликий ризик з невеликим прибутком; розплатитися; збанкрутувати (2 вар.); фінансова паніка; натиск вкладників на банк

4. Answer the questions

1. What did people use as money? Give some examples.

2. What were the reasons that made some societies start using precious metals as money?

3. Who were the original bankers? Where did they keep gold?

4. What are the 2 developments that turned the goldsmiths into bankers? Which of them is of greater importance?

5. What kind of letter did people give to the seller as a payment? What's it called nowadays?

6. Why did people start to say that their money holdings were what they had with them plus their money deposits?

7. How was the system of deposits started?

8. What did a firm ask a goldsmith for? Did he agree to it? On what terms?

9. Explain the information in the first and in the second rows of the table.

10. What did the firm want to do with the gold it had borrowed from the goldsmith? What would we call a deposit today?

11. Explain the information in the third and the fourth rows of the table.

12. What was the goldsmith relying on as a banker?

13. What are reserves and a reserve ratio? What is the goldsmith's reserve ratio after making the loan?

14. Why is it said that the goldsmith took too much of a risk? How much did he lend? What did people do? What is it called nowadays?