Vocabulary notes

regulation – регулирование; инструкция, предписание

taboo – табу

pass smth on to smb – давать, передавать что-л. кому-л.

tough – трудный, тяжёлый

cross-border trade – международная торговля

be billed – быть заваленным счетами

debt collector – уполномоченный инкассатор долгов

sit on smth indefinitely – не давать ходу чему-либо, «класть под сукно»

pre-payment – предоплата

for the goodwill of smb – ради сохранения расположения кого-л.; ради

сохранения репутации (реноме) кого-л.

credit controller – кредитный контролёр

straightaway – сразу, тотчас, немедленно

outstanding debt – неуплаченный долг, непогашенный долг

alienate – отталкивать, заставлять отвернуться

factoring – факторинг; перепродажа права на взыскание долга

factoring agency – факторная (факторинговая) компания ; компания,

специализирующаяся на факторинге

factor’s commission – комиссионные, причитающиеся факторинговой

компании

write off – списывать (со счёта), аннулировать (долг)

balance of power – (зд) равновесие взаимного влияния

show up – выявляться, обнаруживаться, выгодно отличаться

TEXT 4

SAVING AND INVESTMENT IN A GLOBAL ECONOMY

Financial markets help direct financial resources from the owners of these resources to those who require them to finance productive activities. The owners of financial resources are individuals who accumulate resources rather than consuming them each year. These people are savers of financial resources. When other individuals or businesses use financial resources to finance productive endeavors, they invest these resources. These two groups – those who save and those who invest – interact in financial markets.

Saving. The key economic function of financial markets is to channel saving to productive investment. Saving is forgone consumption. Thus, when an individual does not spend all the after-tax income received within a given year, that individual has saved some of her money income.

Investment. Savers, however, do not want their savings to sit idly in money balances if there are alternatives that yield positive returns. Typically, such alternatives exist. The reason is that other individuals or firms normally engage in investment, or additions to the stock of capital goods. Capital goodsare goods that may be used to produce other goods or services in the future.

Investment in capital goods can require significant financial resources, so individuals and firms that invest often must borrow funds or sell ownership shares via initial public offerings or issues of new shares. They obtain these funds from savers with a promise to return the borrowed funds on some future date. Those who invest also promise interest, or payments for the use of funds borrowed from savers. They finance these interest payments using revenues from the production that their new capital goods make possible.

Savers are the ultimate lenders in our economy. Many of the borrowers are firms or individuals who wish to undertake investment. Some individuals, of course, borrow to finance current consumption. Nevertheless, the main reasons for lending and borrowing are that savers desire future interest income on the savings that they hold today, while most borrowers desire to finance investment projects that they expect to yield returns in the future.