- •Unit 5. Overview of the financial system
- •5.1 Getting started
- •5.2 Look through the following vocabulary notes which will help you understand the text and discuss the topic.
- •5.3 Reading Functions of Financial Markets and Financial Intermediaries
- •5.4 Comprehension
- •5.4.1 Answer the questions using the active vocabulary.
- •5.4.2 Mark these statements t(true) or f(false) according to the information in the text. If they are false say why.
- •5.5 Language practice
- •5.5.1 Match the English terms in the left-hand column with the definition in the right-hand column.
- •5.5.2 Complete the following text using suitable words or phrases from the box below.
- •Internationalization of financial markets
- •5.5.3 Complete the text. Replace the Russian words and phrases by English equivalents.
- •International Bond Market, Eurobonds, and Eurocurrencies
- •5.5.4 Text for discussion.
- •Financial Regulation
- •5.6 Render the passage in English using the English equivalents of the italicized phrases given in Russian. Express the main idea of the passage in one sentence.
Financial Regulation
Not surprisingly, given the similarity of the economic system in the USA and in Japan, Canada, and the nations of Western Europe, financial regulation in these countries is similar to financial regulation in the United States. The provision of information is improved by requiring corporations issuing securities to report details about assets and liabilities, earnings, and sales of stock, and by prohibiting insider trading. The soundness of intermediaries is ensured by licensing, periodic inspection of financial intermediaries’ books, and the provision of deposit insurance.
The major differences between financial regulation in the United States and abroad relate to bank regulation. In the past, the United States was the only industrialized country to subject banks to restrictions on branching, which limited banks’ size and restricted them to certain geographic regions. (These restrictions were abolished by legislation in 1994.) US banks are also the most restricted in the range of assets they may hold. Banks abroad frequently hold shares in commercial firms; in Japan and Germany, those stakes can be sizable.
5.6 Render the passage in English using the English equivalents of the italicized phrases given in Russian. Express the main idea of the passage in one sentence.
Основная функция финансовых рынков состоит в перераспределении (is to channel) средств от сберегателей, которые имеют излишек средств (an excess of funds), к расходывателям, которые имеют дефицит средств (a shortage of funds). Финансовые рынки могут делать это либо посредством (either through) прямого финансирования, при котором заемщики занимают средства непосредственно (directly) у кредиторов (lenders), продавая (by selling) им ценные бумаги, или с помощью (through) косвенного (indirect) финансирования, которое включает (involves) финансового посредника, который стоит между кредитором-сберегателем и заемщиком-расходывателем, и помогает переводить (transfer) средства от одного к другому. Это перераспределение средств улучшает (improves) экономическое благосостояние (welfare) каждого в обществе. Так как они позволяют (allow) средствам перемещаться (to move) от людей, которые не имеют инвестиционных возможностей (opportunities), к тем, которые имеют такие возможности, финансовые рынки способствуют (contribute to) экономической эффективности. К тому же (in addition), перераспределение средств приносит прямую пользу (directly benefits) потребителям, позволяя (by allowing) им делать покупки, когда они нуждаются в них больше всего (need them most).