VII. Answer some questions:

1. What is money?

2. What are the functions (uses) of money?

3. What's a barter economy?

4. How are goods exchanged in a barter economy?

5. Why was the barter an unsatisfactory system?

6. Can you imagine a world without money in the form of coins and paper currency? Why?

7. What qualities should money possess?

8. Does modern money have any serious disadvantages as means of storing up value?

9. What else can be used instead of money as a store of value?

10. What is the unit of account in our country?

11. What are different kinds of money?

12. What is commodity money?

13. Explain in your own words what token money means?

14. What is IOU money?

15. What is a coin?

Литература

Основная: 1, 5, 6.

Дополнительная: 2, 3, 4, 7.

Topic 9. Banks and banking

A bank is a financial institution whose primary activity is to act as a payment agent for customers and to borrow and lend money.

The way in which a bank is organised and operates is determined by its objectives and by the type of economy in which it conducts its business. A bank may not necessarily be in business to make a profit.

Banks are closely concerned with the flow of money into and out of the economy. They often co-operate with governments in efforts to stabilize economies and to prevent inflation. They are specialists in the business of providing capital, and in allocating funds on credit.

Banks have three essential functions, which are:

• deposits

• payments

• credits

These three functions are the basis of the services offered by banks. They make it possible for banks to generate profits and to achieve their operating aims.

Banks normally receive money from their customers in two distinct forms: on current account, and on deposit account. With a current account, a customer can issue personal checks. No interest is paid by the bank on this type of account. With a deposit account, however, the customer undertakes to leave his money in the bank for a minimum specified period of time. Interest is paid on this money.

The bank in turn lends the deposited money to customers who need capital. This activity earns interest for the bank, and this interest is almost always at a higher rate than any interest which the bank pays to its depositors. In this way the bank makes its main profits. The primary function of a bank today is to act as an intermediary between depositors who wish to make interest on their savings, and borrowers who wish to obtain capital. The bank is a reservoir of loanable money, with streams of money flowing in and out. For this reason, economists and financiers often talk of money being liquid, or of the liquidity of money. Many small sums which might otherwise be used as capital are rendered useful simply because the bank acts as a reservoir. The system of banks rests upon a basis of trust. Innumerable acts of trust built up the system of which bankers, depositors and borrowers are part. They all agree to behave in certain predictable ways in relation to each other, and in relation to the rapid fluctuations of credit and debit. Consequently, business can be done and checks can be written without any legal tender visibly changing hands.

Banking to provide/to offer various services a variety of services =a wide range of services services provided/offered by banks include... corporate banking private customer banking deposit deposit taking to take in deposits to advise advice to protect buyers and sellers to guarantee payment bank guarantee loan to extend/to grant a loan to repay a loan loan capital to borrow borrower to lend (lent, lent) lender lending rate to establish correspondent relations with... to run an account overdraft credit credit policy credit risks to assess credit risks to assess a bank's performance to manage assets assets under management by... to manage money to manage investment portfolio money market transactions capital market transactions to handle commercial papers to handle government bonds to handle foreign exchange rate of exchange exchange rate fluctuations to adjust exchange rates adjustment boost/advance/gain quotation demand for a currency taxation taxation system income tax property tax inheritance tax corporation tax capital gains tax value added tax (VAT) taxable liable to tax tax rate marginal rate to be tax exempt to charge/to levy taxes tax return/declaration

Банковские услуги предоставлять различные ус­луги широкий спектр услуг услуги, предоставляемые бан­ками, включают... банковский бизнес, обслужи­вающий компании, фирмы и другие юридические лица банковское обслуживание ча­стных лиц депозит, вклад прием депозитов принимать депозиты сообщать, авизовать сообщение, авизо защищать продавца и покупателя гарантировать платеж банковская гарантия кредит предоставить/дать кредит выплатить кредит заемный капитал банка/компании заимствовать заемщик предоставлять кредит кредитор, заимодавец кредитная ставка устанавливать корреспондентские отношения с... вести счет овердрафт: получение кредита путем выписки чека или пла­тежного поручения на сумму, превышающую остаток средств на счете; кредит кредитная политика кредитные риски: риски невозврата кредита оценивать кредитные риски дать оценку финансовой дея­тельности банка управлять активами активы, находящиеся в управ­лении... управлять денежными средст­вами управлять инвестиционным портфелем (включающим цен­ные бумаги, недвижимость то­вары, депозиты и т.д.) операции на рынке средне­срочного и краткосрочного капитала операции на рынке долгосроч­ного капитала работать с документацией по торговым сделкам работать с правительственны­ми облигациями вести валютные операции обменный курс колебания курса корректировать курсы корректировка повышение (курса) котировка цены, курса, ставки (цена продавца или покупателя) спрос на валюту налогообложение система налогообложения подоходный налог налог на недвижимость налог на наследство налог с прибыли предприятий и компаний налог на прирост капитала налог на добавленную стои­мость налогооблагаемый подлежащий налогообложению ставка налога максимальная ставка быть освобожденным от упла­ты налога взимать налог налоговая декларация