Do Current Account Deficits Matter
商务英语1000必备单词 Unit 14 ：Economic Terms 经济术语
商务英语1000必备单词Unit 14 ：Economic Terms 经济术语学习英语中词汇是一个基本的入门，针对不同阶段的人群，需要学习词汇也是不同的，而在商务交往中对于词汇量有着更高的要求，那么关于商务交往中关于经济术语都有必备的哪些词汇呢 ?以下是小编给大家整理的商务英语1000必备单词 Unit 14 Economic Terms 经济术语，希望可以帮到大家Unit 14 Economic Terms第14单元经济术语balance of paymentsThe balance of payments is a summary of all economic transactions.贸易支付差额; 国际收支国际收支平衡表摘要记录所有的经济交易。
bubble economyWe call it a bubble economy because it wasn't supported by the fundamentals.泡沫经济我们称之为泡沫经济是因为它并没有基本面的支撑。
current accountSustained current account deficits are undesirable and should be corrected by appropriate policies.经常账户(指一国一定时期内进出口贸易的差额)长期经常帐赤字是不乐于见到的，应采取适当政策予以矫正。
deficitThe trade deficit is hurting the nation's economy.赤字;逆差贸易赤字对该国经济造成伤害。
domestic demandExpanding domestic demand is a strategic policy that China will adhereto for a long period of time.国内需求扩大国内需求是中国将长期遵循的策略性政策。
克鲁格曼《国际经济学》第八版课后答案(英文)-Ch18
Chapter 18The International Monetary System, 1870–1973Chapter OrganizationMacroeconomic Policy Goals in an Open EconomyInternal Balance: Full Employment and Price-Level StabilityExternal Balance: The Optimal Level of the Current Account International Macroeconomic Policy under the Gold Standard, 1870–1914 Origins of the Gold StandardExternal Balance under the Gold StandardThe Price-Specie-Flow MechanismThe Gold Standard “Rules of the Game”: Myth and RealityBox: Hume v. the MercantilistsInternal Balance under the Gold StandardCase Study: The Political Economy of Exchange Rate Regimes:Conflict over America’s Monetary Standard During the 1890s The Interwar Years, 1918–1939The Fleeting Return to GoldInternational Economic DisintegrationCase Study: The International Gold Standard and the Great DepressionThe Bretton Woods System and the International Monetary Fund Goals and Structure of the IMFConvertibility and the Expansion of Private Capital FlowsSpeculative Capital Flows and CrisesAnalyzing Policy Options under the Bretton Woods System Maintaining Internal BalanceMaintaining External BalanceExpenditure-Changing and Expenditure-Switching PoliciesThe External-Balance Problem of the United StatesCase Study: The Decline and Fall of the Bretton Woods System Worldwide Inflation and the Transition to Floating Rates SummaryChapter OverviewThis is the first of five international monetary policy chapters. These chapters complement the preceding theory chapters in several ways. They provide the historical and institutional background students require to place their theoretical knowledge in a useful context. The chapters also allow students, through study of historical and current events, to sharpen their grasp of the theoretical models and to develop the intuition those models can provide. (Application of the theory to events of current interest will hopefully motivate students to return to earlier chapters and master points that may have been missed on the first pass.)Chapter 18 chronicles the evolution of the international monetary system from the gold standard of1870–1914, through the interwar years, and up to and including the post-World War II Bretton Woods regime that ended in March 1973. The central focus of the chapter is the manner in which each system addressed, or failed to address, the requirements of internal and external balance for its participants.A country is in internal balance when its resources are fully employed and there is price level stability. External balance implies an optimal time path of the current account subject to its being balanced over the long run. Other factors have been important in the definition of external balance at various times, and these are discussed in the text. The basic definition of external balance as an appropriate current-account level, however, seems to capture a goal that most policy-makers share regardless of the particular circumstances.The price-specie-flow mechanism described by David Hume shows how the gold standard could ensure convergence to external balance. You may want to present the following model of the price-specie-flow mechanism. This model is based upon three equations: 1. The balance sheet of the central bank. At the most simple level, this is justgold holdings equals the money supply: G M.2. The quantity theory. With velocity and output assumed constant and bothnormalized to 1, this yields the simple equation M P.3. A balance of payments equation where the current account is a function of thereal exchange rate and there are no private capital flows: CA f(E P*/P)These equations can be combined in a figure like the one below. The 45 line represents the quantity theory, and the vertical line is the price level where the real exchange rate results in a balanced current account. The economy moves along the 45 line back towards the equilibrium Point 0 whenever it is out of equilibrium. For example, the loss of four-fifths of a country’s gold would put that country at Point a with lower prices and a lower money supply. The resulting real exchange rate depreciation causes a current account surplus which restores money balances as the country proceeds up the 45 line froma to 0.FigureThe automatic adjustment process described by the price-specie-flow mechanism is expedited by following “rules of the game” under which governments contract the domestic source components oftheir monetary bases when gold reserves are falling (corresponding to a current-account deficit) and expand when gold reserves are rising (the surplus case).In practice, there was little incentive for countries with expanding gold reserves to follow the “rules of the game.” This increased the contractionary burden shouldered by countries with persistent current account deficits. The gold standard also subjugated internal balance to the demands of external balance. Research suggests price-level stability and high employment were attained less consistently under the gold standard than in the post-1945 period.The interwar years were marked by severe economic instability. The monetization of war debt and of reparation payments led to episodes of hyperinflation in Europe. Anill-fated attempt to return to thepre-war gold parity for the pound led to stagnation in Britain. Competitive devaluations and protectionism were pursued in a futile effort to stimulate domestic economic growth during the Great Depression.These beggar-thy-neighbor policies provoked foreign retaliation and led to the disintegration of the world economy. As one of the case studies shows, strict adherence to the Gold Standard appears to have hurt many countries during the Great Depression.Determined to avoid repeating the mistakes of the interwar years, Allied economic policy-makers metat Bretton Woods in 1944 to forge a new international monetary system for the postwar world. The exchange-rate regime that emerged from this conference had at its center the . dollar. All other currencies had fixed exchange rates against the dollar, which itself had a fixed value in terms of gold.An International Monetary Fund was set up to oversee the system and facilitate its functioning by lending to countries with temporary balance of payments problems.A formal discussion of internal and external balance introduces the concepts of expenditure-switching and expenditure-changing policies. The Bretton Woods system, with its emphasis on infrequent adjustmentof fixed parities, restricted the use of expenditure-switching policies. Increases in U.S. monetary growth to finance fiscal expenditures after the mid-1960s led to a loss of confidence in the dollar and the termination of the dollar’s convertibility into gold. The analysis presented in the text demonstrateshow the Bretton Woods system forced countries to “import” inflation from the United States and shows that the breakdown of the system occurred when countries were no longer willing to accept this burden.Answers to Textbook Problems1. a. Since it takes considerable investment to develop uranium mines, you wouldwant a larger current account deficit to allow your country to finance some of the investment with foreign savings.b. A permanent increase in the world price of copper would cause a short-termcurrent account deficit if the price rise leads you to invest more in coppermining. If there are no investment effects, you would not change yourexternal balance target because it would be optimal simply to spend youradditional income.c. A temporary increase in the world price of copper would cause a currentaccount surplus. You would want to smooth out your country’s consumption bysaving some of its temporarily higher income.d. A temporary rise in the world price of oil would cause a current accountdeficit if you were an importer of oil, but a surplus if you were an exporter of oil.2. Because the marginal propensity to consume out of income is less than 1, atransfer of income from B to A increases savings in A and decreases savings in B.Therefore, A has a current account surplus and B has a corresponding deficit.This corresponds to a balance of payments disequilibrium in Hume’s world, which must be financed by gold flows from B to A. These gold flows increase A’s money supply and decrease B’s money supply, pushing up prices in A and depressingprices in B. These price changes cease once balance of payments equilibrium has been restored.3. Changes in parities reflected both initial misalignments and balance of paymentscrises. Attempts to return to the parities of the prewar period after the war ignored the changes in underlying economic fundamentals that the war caused. This made some exchange rates less than fully credible and encouraged balance ofpayments crises. Central bank commitments to the gold parities were also less than credible after the wartime suspension of the gold standard, and as a result of the increasing concern of governments with internal economic conditions.4. A monetary contraction, under the gold standard, will lead to an increase in thegold holdings of the contracting country’s central bank if other countries do not pursue a similar policy. All countries cannot succeed in doing thissimultaneously since the total stock of gold reserves is fixed in the short run.Under a reserve currency system, however, a monetary contraction causes anincipient rise in the domestic interest rate, which attracts foreign capital. The central bank must accommodate the inflow of foreign capital to preserve theexchange rate parity. There is thus an increase in the central bank’s holdings of foreign reserves equal to the fall in its holdings of domestic assets. There is no obstacle to a simultaneous increase in reserves by all central banksbecause central banks acquire more claims on the reserve currency country while their citizens end up with correspondingly greater liabilities.5. The increase in domestic prices makes home exports less attractive and causes acurrent account deficit. This diminishes the money supply and causescontractionary pressures in the economywhich serve to mitigate and ultimately reverse wage demands and price increases.6. A “demand determined” increase in dollar reserve holdings would not affect theworld supply of money as central banks merely attempt to trade their holdings of domestic assets for dollar rese rves. A “supply determined” increase in reserve holdings, however, would result from expansionary monetary policy in the United States (the reserve center). At least at the end of the Bretton Woods era the increase in world dollar reserves arose in part because of an expansionarymonetary policyin the United States rather than a desire by other central banks to increasetheir holdings of dollar assets. Only the “supply determined” increase indollar reserves is relevant for analyzing the relationship between world holdings of dollar reserves by central banks and inflation.7. An increase in the world interest rate leads to a fall in a central bank’sholdings of foreign reserves as domestic residents trade in their cash forforeign bonds. This leads to a d ecline in the home country’s money supply. The central bank of a “small” country cannot offset these effects sinceit cannot alter the world interest rate. An attempt to sterilize the reserve loss through open market purchases would fail unless bonds are imperfect substitutes.8. Capital account restrictions insulate the domestic interest rate from the worldinterest rate. Monetary policy, as well as fiscal policy, can be used to achieve internal balance. Because there are no offsetting capital flows, monetary policy, as well as fiscal policy, can be used to achieve internal balance. The costs of capital controls include the inefficiency which is introduced when the domestic interest rate differs from the world rate and the high costs of enforcing the controls.9. Yes, it does seem that the external balance problem of a deficit country is moresevere. While the macroeconomic imbalance may be equally problematic in the long run regardless of whether it is a deficit or surplus, large external deficits involve the risk that the market will fix the problem quickly by ceasing to fund the external deficit. In this case, there may have to be rapid adjustment that could be disruptive. Surplus countries are rarely forced into rapid adjustments, making the problems less risky.10. An inflow attack is different from capital flight, but many parallels exist. Inan “outflow” attack, speculators sell the home currency and drain the central bank of its foreign assets. The central bank could always defend if it so chooses (they can raise interest rates to improbably high levels), but if it is unwilling to cripple the economy with tight monetary policy, it must relent. An “inflow”attack is similar in that the central bank can always maintain the peg, it is just that the consequences of doing so may be more unpalatable than breaking the peg. If money flows in, the central bank must buy foreign assets to keep thecurrency from appreciating. If the central bank cannot sterilize all the inflows (eventually they may run out of domestic assets to sell to sterilize thetransactions where they are buying foreign assets), it will have to either let the currency appreciate or let the money supply rise. If it is unwilling to allow and increase in inflation due to a rising money supply, breaking the peg may be preferable.11. a. We know that China has a very large current account surplus, placing them highabove the XX line. They also have moderate inflationary pressures (describedas “gathering” in the question, implying they are not yet very strong). This suggests that China is above the II line, but not too far above it. It wouldbe placed in Zone 1 (see below).b. China needs to appreciate the exchange rate to move down on the graph towardsbalance. (Shown on the graph with the dashed line down)c. China would need to expand government spending to move to the right and hitthe overall balance point. Such a policy would help cushion the negative aggregate demand pressurethat the appreciation might generate.。
英语第五单元课文及翻译及分段
Ultra-low Interest Rate:Distributional Effects and Risks超低利率:分配效应和风险1、There is widespread consensus that the conventional and unconventional monetary policiesthat world’s major central banks implemented in response to the global financial crisis prevent ed a deeper recession and higher unemployment than there otherwise would have been. These measures, along with a lack of demand for credit as a result of the recession, contributed to a decline in real and nominal interest rates to ultra-low levels that have been sustained over the past five years.一个普遍的共识是，世界主要央行为应对全球金融危机所实施的常规和非常规的货币政策防止了更严重的经济衰退和更高失业率的发生，否则情况会更糟糕。
这些措施，以及由于经济衰退而缺乏的信贷需求，导致实际利率和名义利率下降到了超低水平，过去五年中一直如此。
2、A new report from the McKinsey Global Institute examines the distributional effects of theseultra-low rates. It finds that there have been significant effects on different sectors in the economy in terms of income interest and expense. From 2007 to 2012, governments in the eurozone, the United Kingdom, and the United States collectively benefited by $1.6 trillion both through reduced debt-service costs and increased profits remitted from central banks (exhibit). Nonfinancial corporations—large borrowers such as governments—benefited by $710 billion as the interest rates on debt fell. Although ultra-low interest rates boosted corporate profits in the United Kingdom and the United States by 5 percent in 2012, this has not translated into higher investment, possibly as a result of uncertainty about the strength of the economic recovery, as well as tighter lending standards. Meanwhile, households in these countries together lost $630 billion in net interest income, although the impact varies across groups. Younger households that are net borrowers have benefited, while older households with significant interest-bearing assets have lost income.麦肯锡全球研究院的一份新报告分析了这些超低利率造成的分配效应。
IMF高级宏观经济学研修班课程CT1405MMFL02Moneta
3.13.
What can monetary policy do?
• Can effectively control prices and exchange rates – nominal variables
• Can serve as a nominal anchor in the economy • Can contribute to economic growth and help
I. What are the ultimate goals of monetary policy?
1.Price stability 2.Output and employment 3. Exchange rate stability 4. Post global crisis, calls to also target financial
III. How to choose a monetary framework? IV. What choices were made in the past? V. How well did they perform? VI. China’s choices
This training material is the property of the International Monetary Fund (IMF) and is intended for use in IMF’s Institute for Capacity development (ICD) courses. Any reuse requires the permission of ICD.
exports and can lead to current account deficits. • A flexible ER might be a powerful tool to restore
商务英语1000必备单词 Unit 14 ：Economic Terms 经济术语
商务英语1000必备单词Unit 14 ：Economic Terms 经济术语学习英语中词汇是一个基本的入门，针对不同阶段的人群，需要学习词汇也是不同的，而在商务交往中对于词汇量有着更高的要求，那么关于商务交往中关于经济术语都有必备的哪些词汇呢?以下是给大家整理的商务英语1000必备单词Unit 14 Economic Terms 经济术语，希望可以帮到大家Unit 14 Economic Terms第14单元经济术语balance of paymentsThe balance of payments is a summary of all economic transactions.贸易支付差额; 国际收支国际收支平衡表摘要记录所有的经济交易。
bubble economyWe call it a bubble economy because it wasnt supported by the fundamentals.泡沫经济我们称之为泡沫经济是因为它并没有基本面的支撑。
current accountSustained current account deficits are undesirable and should be corrected by appropriate policies.经常账户(指一国一定时期内进出口贸易的差额)长期经常帐赤字是不乐于见到的，应采取适当政策予以矫正。
deficitThe trade deficit is hurting the nations economy.赤字;逆差贸易赤字对该国经济造成伤害。
domestic demandExpanding domestic demand is a strategic policy that China will adhere to for a long period of time.国内需求扩大国内需求是中国将长期遵循的策略性政策。
2008对外经贸大学815经济学综合考研真题及答案
对外经济贸易大学2008年硕士学位研究生入学考试初试试题考试科目：815 经济学综合一、名词解释(每小题3分，共12 分)1、范围经济2、帕累托改进3、成本推动通货膨胀4、流动性陷阱二、单项选择(10题，每小题1分，共10分)1、对于商品房价格将会进一步上升的预期，导致的直接结果是目前商品房市场中的（？）A．供应量增加B：供给增加C．需求量增加D．需求增加2、如果闲暇是正常品，则财产性收入的增加会导致劳动供给量（？）A．增加B．减少 C.不改变D．不确定3、根据基尼系数的大小，下列四个国家中哪一个国家的分配最为平均：（？）A.甲国的基尼系数为0.20B.乙国的基尼系数为0.35C.丙国的基尼系数为0.50D.丁国的基尼系数为0.604、在一级价格歧视下，（？）。
A．厂商根据消费者的需求价格弹性不同收取不同价格B．厂商可以在不同时间向消赞者收取不同价格C．厂商只是改变了定价的方式，但是并没有改变产量水平D．产品的边际收益等于产品价格5、对于生产相同产品的厂商来说，（？）模型分析得到的结论与竞争模型的结论相同。
A．古诺(Cournot) B.斯塔克伯格（Stackbelberg）C．伯特兰德(Bertrand) D.主导厂商（Dominant Firm）6、向政府雇员支付的报酬属于（？）A.政府购买支出B.转移支付C.政府税收D.消费7、决定美国和中国的投资乘数不一样的因素主要是：A．两国的平均消费倾向差异B．两国的边际消费倾向差异C．两国的企业投资规模差异D．两国的投资预期收益差异8、在经济增长模型中，衡量技术进步最常用的度量标准是（？）A．劳动利用程度B．资本利用程度C．索洛剩余D．劳动生产率9、通常认为，下列属于紧缩货币的政策是（？）A．提高贴现率B．增加货币供给C．降低法定准备金率D．中央银行头入政府债券10、在浮动汇率制的开放经济中，净出口受到实际扩率变动的影响，财政政策效应（？）A．与封闭经济中的效应并无区别B．小于封闭经济中的效应C．大于封闭经济中的效应D．可能大于、等于或小于封闭经济中的效应三、判断下列表述的内容是否正确(每小题1 分，共10 分)1．如采所有商品的价格变成原来的两倍，而收入变成原来收入的三倍，则消费者的预算线会平行向外移动。
克鲁格曼《国际经济学》(国际金融部分)课后习题答案(英文版)第一章
CHAPTER 1INTRODUCTIONChapter OrganizationWhat is International Economics About?The Gains from TradeThe Pattern of TradeProtectionismThe Balance of PaymentsExchange-Rate DeterminationInternational Policy CoordinationThe International Capital MarketInternational Economics: Trade and MoneyCHAPTER OVERVIEWThe intent of this chapter is to provide both an overview of the subject matter of international economics and to provide a guide to the organization of the text. It is relatively easy for an instructor to motivate the study of international trade and finance. The front pages of newspapers, the covers of magazines, and the lead reports of television news broadcasts herald the interdependence of the U.S. economy with the rest of the world. This interdependence may also be recognized by students through their purchases of imports of all sorts of goods, their personal observations of the effects of dislocations due to international competition, and their experience through travel abroad.The study of the theory of international economics generates an understanding of many key events that shape our domestic and international environment. In recent history, these events include the causes and consequences of the large current account deficits of the United States; the dramatic appreciation of the dollar during the first half of the 1980s followed by its rapid depreciation in the second half of the 1980s; the Latin American debt crisis of the 1980s and the Mexico crisis in late 1994; and the increased pressures for industry protection against foreign competition broadly voiced in the late 1980s and more vocally espoused in the first half of the 1990s. Most recently, the financial crisis that began in East Asia in 1997 andspread to many countries around the globe and the Economic and Monetary Union in Europe have highlighted the way in which various national economies are linked and how important it is for us to understand these connections. At the same time, protests at global economic meetings have highlighted opposition to globalization. The text material will enable students to understand the economic context in which such events occur.Chapter 1 of the text presents data demonstrating the growth in trade and increasing importance of international economics. This chapter also highlights and briefly discusses seven themes which arise throughout the book. These themes include: 1) the gains from trade;2) the pattern of trade; 3) protectionism; 4), the balance of payments; 5) exchange rate determination; 6) international policy coordination; and 7) the international capital market. Students will recognize that many of the central policy debates occurring today come under the rubric of one of these themes. Indeed, it is often a fruitful heuristic to use current events to illustrate the force of the key themes and arguments which are presented throughout the text.。
国际贸易与金融II(双语)国际贸易与金融22.1 教学大纲
《国际贸易与金融(2)》课程教学大纲一、课程总述二、教学时数分配三、单元教学目的、教学重难点和内容设置Chapter11 The Balance of Payments【教学目的】After completing this chapter, the student should be able to:∙Define the balance of payments.∙Identify the credit and debit transactions on the balance of payments.∙Discuss the current account and the capital account of the balance of payments.∙Identify trends on the U.S. balance of payments.∙Describe the balance of international indebtedness.【重点难点】the U.S. balance of payments and the U.S. balance of international indebtedness. Of particular importance is the United States as a debtor nation and the views concerning the effects of U.S. indebtedness.【教学内容】. Double-entry accounting. Balance-of-payments structure. International payments process. U.S balance of payments. What does a current account deficit. Do current account deficits cost. Balance of international indebtednessCHAPTER 12 FOREIGN EXCHANGE【教学目的】After completing this chapter, the student should be able to:∙Discuss the operation of the foreign exchange market.∙Understand the foreign exchange quotations of The Wall Street Journal.∙Explain how traders benefit from the forward exchange market.∙Describe how exchange rates are determined in a free market.∙Discuss the nature and operation of currency arbitrage.∙Explain the strategy of exchange-rate speculation.【重点难点】the nature and operation of the foreign exchange market.【教学内容】. Foreign-exchange market. Types of foreign-exchange transaction. interbank trading. Traders run currency markets. Reading foreign-exchange quotations. Forward and futures markets. Foreign-currency options. Exchange –rate determination. Indexes of the foreign-exchange value of the dollar: nominal and real exchange rate. Arbitrage. The forward market. Interest arbitrage. Foreign-exchange market speculation. Speculation and exchange-market stability..CHAPTER 13 EXCHANGE-RATE DETERMINATION【教学目的】After completing this chapter, students should be able to:∙Identify the market fundamentals which underlie movements in exchange rates.∙Explain how market expectations affect currency values.∙Discuss how market fundamentals and market expectations interact to influence exchange rates. ∙Explain how the volatility of exchange rates is influenced by the phenomenon of overshooting.【重点难点】explain the factors that underlie currency movements.【教学内容】.xchange-rate determination in a free market. Real income and exchange rates. Real interest rates and exchange rates. Inflation rates, purchasing power parity and exchange rates. Other market fundamentals and their effects on exchange rates. Market expectations and exchange rates. Interaction of exchange-rate determinantsThe Federal Reserve and the monetary. Financial assets as determinants of exchange rates. Exchange-rate overshooting. Forecasting foreign-exchange rateCHAPTER 14 BALANCE-OF-PAYMENTS ADJUSTMENTSUNDER FIXEDEXCHANGE RATES【教学目的】After completing the chapter, students should be able to:∙Identify the adverse effects that persistent balance-of-payments disequilibriums have on an economy.∙Discuss the automatic adjustment mechanisms in the balance of payments that occur under a system of fixed exchange rates.∙Describe the disadvantages of the automatic adjustments of the balance of payments.∙Explain why the monetary approach to the balance of payments is an alternative to traditional adjustment theories.【重点难点】balance-of-payments adjustments under fixed exchange rates【教学内容】Price adjustments. Interest-rate adjustments. Capital flows and the balance of payments. Income adjustments. Income determination in a closed economy. Monetary adjustmentsCHAPTER 15 EXCHANGE-RATE JUSTMENTS ANDTHE BALANCE OF PAYMENTS【教学目的】After completing the chapter, students should be able to:∙Discuss how currency depreciation (devaluation) affects a nation’s trade position through its impact on relative prices, incomes, and purchasing power of money balances.∙Explain how the J-curve effect relates to the time path of currency depreciation.∙Discuss the significance of currency pass through for exchange rate changes.∙Describe the absorption approach to currency devaluation.【重点难点】·currency dep reciation (devaluation) can affect a nation’s trade position through its impact on relative prices, incomes, and purchasing power of money balances.【教学内容】. Effects of exchange-rate changes on costs and price. Cost-cutting strategies of manufactures in response to currency appreciation. Requirements for a successful depreciation (devaluation). The elasticity approach to exchange-rate adjustment. The dollar and U.S. manufacturing. The absorption approach to exchange-rate adjustment. The monetary approach to exchange-rate adjustmentCHAPTER 16 EXCHANGE-RATE SYSTEMS【教学目的】After completing the chapter, students should be able to:∙Identify the criteria which underlie a nation’s preference for fixed exchange rates or floating exchange rates.∙Explain the importance of the special drawing right for the international monetary system.∙Discuss the advantages and disadvantages of a fixed exchange rate system and a floating exchange rate system.∙Describe the operation of a system of managed-floating exchange rates.【重点难点】·a survey of exchange-rate systems and identifies the economic factors that influence the choice of alternative exchange-rate systems.【教学内容】. Exchange-rate practices. Fixed exchange-rate system. Stabilizing currencies of developing countries: currencies board versus dollarization. Floating exchange rates. Adjustable pegged rates. Managed floating rates. The crawling peg. Exchange controlsCHAPTER 17 MACROECONOMIC POLICY IN AN OPEN ECONOMY【教学目的】After completing the chapter, students should be able to:∙Identify the tools of international economic policy.∙Discuss how nations use expenditure-changing policies and expenditure-switching policies to achieve overall balance.∙Explain the significance of policy agreement and policy disagreement.∙Describe the importance of international economic policy coordination for the world’s financial system.∙Identify the problems confronting international economic policy coordination.【重点难点】a survey of macroeconomic policy in an open economy.【教学内容】. Economic policy in an open economy. Economic objectives of nations. Policy instruments. Exchange-rate policies and overall balance. Monetary policy and fiscal policy: effects on internal balance. Monetary and fiscal policies: effects on external balance. Monetary policy and fiscal policy: policy agreement and policy conflict. Inflation with unemployment. International economic-policy coordinationCHAPTER 18 INTERNATIONAL BANKING:RESERVES, DEBT, AND RISK【教学目的】After completing the chapter, students should be able to:∙Explain how international reserves allow nations to cope with balance-of-payments disequilibria. ∙Identify the determinants of the demand for international reserves.∙Identify the major sources of international reserves.∙Describe the risks that bankers face when making loans to international borrowers.∙Discuss the options available to nations which experience debt-servicing difficulties.∙Discuss the role of the International Monetary Fund in the world financial system.【重点难点】a survey of the international banking system.【教学内容】·Nature of international reserves. Demand for international reserves. The international monetary fund. Supply of international reserves. Foreign currencies. Gold. Gold exchange standard. Special drawing rightes. Facilities for borrowing reserves. International lending risk. The problem of international debt. Reducing bank exposure to developing-nation debt. Debt reduction and debt forgiveness. Financial crisis and the international monetary fund. The Eurocurrency market。
CURRENT ACCOUNT经常项目
The Causes of Current Account Deficit of the States
The Low Interest Rate and Financial Policy of Deficit The Restrictions The Continuing
on the Export
current account surplus
On the other hand, if an economy is running a current account surplus it is absorbing less than that it is producing. This means it is saving. As the economy is open, this saving is being invested abroad and thus foreign assets are being created. The balance of the current account tells us if a country has a deficit or a sur plus. It is not necessarily that a deficit means a weak economy and a surplu s means a strong economy.
current account deficit
If an economy is running a current account deficit, it is
absorbing (absorption = domestic consumption + investment + government spending)
国际金融英文版习题chapter2
1International FinanceAssignment Problems (2) Name: Student No.:I. Choose the correct answer for the following questions (only ONE correct answer)(5 credits for each question, total credits 4 x 15 = 60)1. According to the principle of the balanced balance of payments, if a country reduces its foreign exchange reserves by $20 million and the statistical discrepancy is in the credit entry of $5 million in a given period of time, the country runs __________ of its balance of payments during that period of time.A. $15 million deficitsB. $25 million deficitsC. $20 million deficitsD. $5 million deficits2. If a country’s domestic saving is greater than domestic investment, the country probably has __________.A. a current account surplusB. a net capital outflowC. a current account deficitD. Both A and B are possible.3. A debit entry in the balance-of-payments account represents a transaction that __________.A. a domestic resident receives a payment from abroadB. a domestic resident makes a payment to a foreign residentC. will improve the current account statusD. will have no affects on the nation’s foreign exchange reserves4. In terms of balance-of-payments account, which of the following would be recorded as a debit entry in the U.S. BOP?A. exports of merchandiseB. exports of servicesC. purchase of the U.S. Treasury bonds by non-residentsD. an increase of the deposit in a U.S. resident's account at a foreign bank5. A balance-of-payments deficit is defined as a situation in which __________.A. the value of payments made to the foreigners exceeds the value of receipts received from the foreigners in a given period of timeB. the government must borrow in order to meet its budget obligationsC. the value of manufactured good exports is less than the value of imported goodsD. a nation earns much in extra assets or reduced liabilities in its dealings with the rest of the world6. Which of the following would NOT be considered as a typical BOP transaction?A. Toyota USA is a US distributor of automobiles manufactured in Japan by its parent company.B. A U.S. subsidiary of European financial giant, Credit Suisse, pays dividends to its parent in Zurich.C. A US tourist purchases gifts at a museum in London.D. All are example of BOP transactions.7. The balance of payments is a statistical record which measures the total value of __________.A. a country’s foreign exchange reserves in a certain period of timeB. a country’s foreign trades between the residents of a country and its non-residents for a given period of timeC. all economic and financial transactions between the residents of a country and its non-residents for a given period of timeD. a country’s capital inflows and outflows at a particular date in a given year8. A British pension fund sells some of its holdings of the stocks of U.S. companies in order to buy U.S. corporate bonds. This transaction will affect __________.A. the U.S. international investment positionB. the British international investment positionC. both countries’ international investment positionD. None of the above. This is because both countries’ international investment position unchanged, only the composition of foreign investments in both U.S. and U.K. changes.9. Which of the following transactions is included in China’s balance-of-payments account?A. A U.S. embassy in Beijing pays salaries to its American staffs.B. The World Bank furnishes the Chinese government with a loan.C. A U.S. student pays tuition fees for his 4 year-study in Beijing University.D. The Chinese embassy in Washington buys telecommunication equipments from a Chinese company in Shanghai.10. If the U.S. runs current account deficits, we can expect that __________.A. it may act as a net debtor in the rest of the worldB. its domestic saving may less than its domestic investmentC. its domestic production is less than its domestic consumptionD. all of the above11. The trade deficit means that __________.A. residents are importing more goods than they are exportingB. residents are borrowing more funds than they are lendingC. residents are receiving more payments than they are makingD. residents are producing more goods than they are consuming12. Which of the following is an example of an exchange of financial assets?A. the exchange of butter for wheatB. the exchange of information technologyC. the exchange of a fixed-rate loan for a floating-rate loanD. the exchange of gold for jewelry13. For most countries, the subcategory that typically dominates the current account is __________.A. unilateral transfersB. goods tradeC. income tradeD. services trade14. When categorizing investments for the financial account component of the balance of payments the __________ is an investment where the investor has no incentive to control whereas the __________ is an investment where the investor wants to control over the assets.A. direct investment, portfolio investmentB. direct investment, indirect investmentC. portfolio investment, indirect investmentD. portfolio investment, direct investment15. If a country’s merchandise exports exceed its imports by $50 million, services trade balance is net $30 million and unilateral transfers made in excess of those received by $5 million, what is the country’s current account balance?A. $85 millionB. $75 millionC. $15 millionD. $25 million1. Country A’s BOT is __________.2. Country A’s current account balance is __________.3. Suppose the changes in country A’s official reserves are zero in 2010, its capital and financial account balance MUST be __________.4. If country A’s official reserves are recorded on the credit side by $10 million in 2010, its capital and financial account balance should be __________.5. Based on the assumption of question 4, country A has BOP deficit or surplus in 2010? Explain.6. What is the current account balance of a nation with a government budget deficit of $128 billion, private saving of $806 billion, and domestic capital formation of $777 billion?III. Express the following operations in the Dutch balance of payments in T-accounts:(5 credits for each question, total credits 3 x 5 = 15)a. A Dutch company exports €100,000 goods to a London company for €100,000 in bank deposits.b. An import billed for €150,000 paid with a check drawn on a London bank.c. A Dutch company based in Rotterdam uses €1 million that it was holding in a short-term deposit with its Rotterdam bank to purchase 10-year bonds issued by German government.IV. True or false: (7 credits)A credit entry in the balance of payments represents a demand for local currency whereas a debit entry represents a supply of local currency. You MUST explain your answer.Part IVTrue. Because the credit entry in BOP means domestic residents receiving foreigncurrencies. When they sell those foreign payments, they demand the local currency. The debit entry in BOP implies domestic residents need to buy foreign currencies with the local currency. Therefore, it represents a supply of local currency.。
CURRENT-ACCOUNT讲课讲稿
current account surplus
On the other hand, if an economy is running a current account surplus it is absorbing less than that it is producing. This means it is saving. As the economy is open, this saving is being invested abroad and thus foreign assets are being created.
more than that it is producing. This can only happen if some other economies are lending their savings to it (in the form of debt to or direct/ portfolio investment in the economy) or the economy is running down its foreign assets such as offici
The balance of the current account tells us if a country has a deficit or a surplus. It is not neces sarily that a deficit means a weak economy and a surplus means a strong economy.
1. Goods These are movable and physical in nature, and in order for a transaction to be recorded under "goods", a change of o wnership from/to a resident (of the local country) to/fro m a non-resident (in a foreign country) has to take place. Movable goods i nclude general merchandise, goods used for processing other goods, and nonmonetary gold. An export is marked as a credit (money coming in) and an import is noted as a debit (money goi ng out).
国际财务管理课后习题答案chapter 3
CHAPTER 3 BALANCE OF PAYMENTSSUGGESTED ANSWERS AND SOLUTIONS TO END-OF-CHAPTERQUESTIONS AND PROBLEMSQUESTIONS1. Define the balance of payments.Answer: The balance of payments (BOP) can be defined as the statistical record of a country’s international transactions over a certain period of time presented in the form of double-entry bookkeeping.2. Why would it be useful to examine a country’s balance of payments data?Answer: It would be useful to examine a country’s BOP for at least two reaso ns. First, BOP provides detailed information about the supply and demand of the country’s currency. Second, BOP data can be used to evaluate the performance of the country in international economic competition. For example, if a country is experiencing per ennial BOP deficits, it may signal that the country’s industries lack competitiveness.3. The United States has experienced continuous current account deficits since the early 1980s. What do you think are the main causes for the deficits? What would be the consequences of continuous U.S. current account deficits?Answer: The current account deficits of U.S. may have reflected a few reasons such as (I) a historically high real interest rate in the U.S., which is due to ballooning federal budget deficits, that kept the dollar strong, and (ii) weak competitiveness of the U.S. industries.4. In contrast to the U.S., Japan has realized continuous current account surpluses. What could be the main causes for these surpluses? Is it desirable to have continuous current account surpluses?Answer: Japan’s continuous current account surpluses may have reflected a weak yen and high competitiveness of Japanese industries. Massive capital exports by Japan prevented yen from appreciating more than it did. At the same time, foreigners’ exports to Japan were hampered by closed nature of Japanese markets. Continuous current account surpluses disrupt free trade by promoting protectionistsentiment in the deficit country. It is not desirable especially when it is brought about by the mercantilist policies.5. Comment on the following statement: “Since the U.S. imports more than it exports, it is necessary for the U.S. to import capital from foreign countries to finance its current account deficits.”Answer: The statement presupposes that the U.S. current account deficit causes its capital account surplus. In reality, the causality may be running in the opposite direction: U.S. capital account surplus may cause the country’s current account deficit. Suppose foreigners fin d the U.S. a great place to invest and send their capital to the U.S., resulting in U.S. capital account surplus. This capital inflow will strengthen the dollar, hurting the U.S. export and encouraging imports from foreign countries, causing current account deficits.6. Explain how a country can run an overall balance of payments deficit or surplus.Answer: A country can run an overall BOP deficit or surplus by engaging in the official reserve transactions. For example, an overall BOP deficit can be su pported by drawing down the central bank’s reserve holdings. Likewise, an overall BOP surplus can be absorbed by adding to the central bank’s reserve holdings.7. Explain official reserve assets and its major components.Answer: Official reserve assets are those financial assets that can be used as international means of payments. Currently, official reserve assets comprise: (I) gold, (ii) foreign exchanges, (iii) special drawing rights (SDRs), and (iv) reserve positions with the IMF. Foreign exchanges are by far the most important official reserves.8. Explain how to compute the overall balance and discuss its significance.Answer: The overall BOP is determined by computing the cumulative balance of payments including the current account, capital account, and the statistical discrepancies. The overall BOP is significant because it indicates a country’s international payment gap that must be financed by the government’s official reserve transactions.9. Since the early 1980s, foreign portfolio investors have purchased a significant portion of U.S. treasury bond issues. Discuss the short-term and long-term effects of foreigners’ portfolio investment on the U.S. balance of payments.Answer: As foreigners purchase U.S. Treasury bonds, U.S. BOP will improve in the short run. But in the long run, U.S. BOP may deteriorate because the U.S. should pay interests and principals to foreigners. If foreign funds are used productively and contributes to the competitiveness of U.S. industries, however, U.S. BOP may improve in the long run.10. Describe the balance of payments identity and discuss its implications under the fixed and flexible exchange rate regimes.Answer: The balance of payments identity holds that the combined balance on the current and capital accounts should be equal in size, but opposite in sign, to the change in the official reserves: BCA + BKA = -BRA. Under the pure flexible exchange rate regime, central banks do not engage in official reserve transactions. Thus, the overall balance must balance, i.e., BCA = -BKA. Under the fixed exchange rate regime, however, a country can have an overall BOP surplus or deficit as the central bank will accommodate it via official reserve transactions.11. Exhibit 3.3 indicates that in 1991, the U.S. had a current account deficit and at the same time a capital account deficit. Explain how this can happen?Answer: In 1991, the U.S. experienced an overall BOP deficit, which must have been accommodated by the Federal Reserve’s official reserve action, i.e., drawing down its reserve holdings.12. Explain how each of the following transactions will be classified and recorded in the debit and credit of the U.S. balance of payments:(1) A Japanese insurance company purchases U.S. Treasury bonds and pays out of its bank account kept in New York City.(2) A U.S. citizen consumes a meal at a restaurant in Paris and pays with her American Express card.(3) A Indian immigrant living in Los Angeles sends a check drawn on his L.A. bank account as a gift to his parents living in Bombay.(4) A U.S. computer programmer is hired by a British company for consulting and gets paid from the U.S. bank account maintained by the British company.Answer:_________________________________________________________________Transactions Credit Debit_________________________________________________________________Japanese purchase of U.S. T bonds √Japanese payment using NYC account √U.S. citizen having a meal in Paris √Paying the meal with American Express √Gift to parents in Bombay √Receipts of the check by parents (goodwill) √Export of programming service √British payment out its account in U.S. √_________________________________________________________________13. Construct the balance of payment table for Japan for the year of 1998 which is comparable in format to Exhibit 3.1, and interpret the numerical data. You may consult International Financial Statistics published by IMF or research for useful websites for the data yourself.Answer:A summary of the Japanese Balance of Payments for 1998 (in $ billion)Credits DebitsCurrent Account(1) Exports 646.03(1.1) Merchandise 374.04(1.2) Services 62.41(1.3) Factor income 209.58(2) Imports -516.50(2.1) Merchandise -251.66(2.2) Services -111.83(3.3) Factor income -153.01(3) Unilateral transfer 5.53 -14.37Balance on current account 120.69[(1) + (2) + (3)]Capital Account(4) Direct investment 3.27 -24.62(5) Portfolio investment 73.70 -113.73(5.1) Equity securities 16.11 -14.00(5.2) Debt securities 57.59 -99.73(6) Other investment 39.51 -109.35Balance on financial account -131.22[(4) + (5) + (6)](7) Statistical discrepancies 4.36Overall balance -6.17Official Reserve Account 6.17Source: IMF, International Financial Statistics Yearbook, 1999.Note: Capital account in the above table corresponds with the ‘Financial account’ in IMF’s balance of payment statistics. IMF’s Capital account’ is included in ‘Other investment’ in the above table.MINI CASE: MEXICO’S BALANCE OF PAYMENTS PROBLEMRecently, Mexico experienced large-scale trade deficits, depletion of foreign reserve holdings and a major currency devaluation in December 1994, followed by the decision to freely float the peso. These events also brought about a severe recession and higher unemployment in Mexico. Since the devaluation, however, the trade balance has improved.Investigate the Mexican experiences in detail and write a report on the subject. In the report, you may:(a) document the tr end in Mexico’s key economic indicators, such as the balance of payments, the exchange rate, and foreign reserve holdings, during the period 1994.1 through 1995.12.;(b) investigate the causes of Mexico’s balance of payments difficulties prior to the peso devaluation;(c) discuss what policy actions might have prevented or mitigated the balance of payments problem and the subsequent collapse of the peso; and(d) derive lessons from the Mexican experience that may be useful for other developing countries.In your report, you may identify and address any other relevant issues concerning Mexico’s balance of payment problem.Suggested Solution to Mexico’s Balance-of-Payments ProblemTo solve this case, it is useful to review Chapter 2, especially the section on the Mexican peso crisis. Despite the fact that Mexico had experienced continuous trade deficits until December 1994, the country’s currency was not allowed to depreciate for political reasons. The Mexican government did not want the peso devaluation before the Presidential election held in 1994. If the Mexican peso had been allowed to gradually depreciate against the major currencies, the peso crisis could have been prevented.The key lessons that can be derived from the peso crisis are: First, Mexico depended too much on short-term foreign portfolio capital (which is easily reversible) for its economic growth. The country perhaps should have saved more domestically and depended more on long-term foreign capital. This can be a valuable lesson for many developing countries. Second, the lack of reliable economic information was another contributing factor to the peso crisis. The Salinas administration was reluctant to fully disclose the true state of the Mexican economy. If investors had known that Mexico was experiencing serious trade deficits and rapid depletion of foreign exchange reserves, the peso might have been gradually depreciating, rather than suddenly collapsed as it did. The transparent disclosure of economic data can help prevent the peso-type crisis. Third, it is important to safeguard the world financial system from the peso-type crisis. To this end, a multinational safety net needs to be in place to contain the peso-type crisis in the early stage.。
经济金融常用英语词汇
常见金融英语词汇一览,应该有你需要的部分;financial turmoil/meltdown 金融危机Federal Reserve 美联储real estate 房地产share 股票valuation 股价equity market 股市shareholder 股东macroeconomic 宏观经济saving account 储蓄帐户go under 破产take a nosedive 股市大跌tumble 下跌big macs,big/large-cap stock,mega-issue 大盘股offering,list 上市bourse 证交所corporate champion 龙头企业Shanghai Exchange 上海证交所pension fund 养老基金mutual fund 共同基金hedge mutual fund 对冲式共同基金underwriter 保险商government bond 政府债券budget 预算deficit 赤字delist 摘牌mongey-loser 亏损企业inventory 存货traded company,trading enterprise 上市公司stakeholder 利益相关者transparency 透明度market fundamentalist 市场经济基本规则damage-contral machinery 安全顾问efficient market 有效市场intellectual property 知识产权opportunistic practice 投机行为entrepreneur 企业家cook the book 做假帐regulatory system 监管体系portfolio 投资组合money-market 短期资本市场capital-market 长期资本市场volatility 波动diversification 多元化option 期权call option 看涨期权put option 看跌期权merger 并购arbitrage 套利Securities and Exchange Commission 〈美〉证券交易委员会dollar standard 美元本位制bad debt 坏帐fiscal stimulus 财政刺激a store of value 保值transaction currency 结算货币forward exchange 期货交易intervention currency 干预货币Treasury bond 财政部公债current-account 经常项目pickup in rice 物价上涨Federal Reserve 美联储inflation 通货膨胀deflation 通货紧缩tighter credit 紧缩信贷monetary policy 货币政策foreigh exchange 外汇spot transaction 即期交易forward transaction 远期交易option forward transaction 择期交易swap transaction 调期交易quote 报价settlment and delivery 交割buying rate 买入价selling rate 卖出价spread 差幅contract 合同at par 平价premium 升水discount 贴水direct quoation method 直接报价法indirect quoation method 间接报价法dividend 股息domestic currency 本币floating rate 浮动利率parent company 母公司credit swap 互惠贷款venture capital 风险资本book value 帐面价值physical capital 实际资本IPOinitial public offering 新股首发；首次公开发行job machine 就业市场welfare capitalism 福利资本主义collective market cap 市场资本总值golbal corporation 跨国公司transnational status 跨国优势transfer price 转让价格consolidation 兼并leverage 杠杆file for bankruptcy 申请破产bailout 救助take over 收购buy out 购买某人的产权或全部货物falter 摇摇欲坠on the hook 被套住shore up confidence 提振市场信心stave off 挡开, 避开,liquidate assets 资产清算at fire sale prices 超低价sell-off 证券的跌价有关经济的作文：Net Economy网络经济People are talking about the "new economy" It's very They see people face-to-face at theirjob or in stores. People get information from newspapers, radios, televisions, reference books and the library.In the new economy, people do business through the "net", which is a connection of millions of computers everywhere in the world. In the new economy, workers often work at home. They can get information on-line. They can communicate with employers and co-workers by e-mail. Customersshop on-line. Businesses have "virtual stores". They are websites on which customers can see the products. Businesses can sell to customers anywhere in the world.In the new economy, people live a fast paced, convenient and colorful life. The whole world develops more rapidly than before. But the new economy is a double-edged disadvantage is also obvious. For example, the Internet has led to a huge increase in credit-card cheating. Some illegal websites offer some cheap or banned goods or shoppers who enter their credit-card information may never receive the goods they want to buy and their card informarion could even be for sale on an illegal website. So peopie in the new economy should be more smart and knowledgeable.不景气slump 衰退recession二板市场the second board market中国创业板China Growth Enterprise Market 首次上市IPOs initial public offering市场资本总额market capitalization 法人股institutional shares内部股非上市招股private company shares 牛市bull market法律风险legal risk 风险管理risk management坚持严格的贷款标准maintain strong underwriting standards六大风险risks in 6 key areas . Federal Reserve criterion信用风险credit risk 供给学派supply-side economist第一产业农业agriculture primary industry第二产业工业manufacturing industry secondary industry第三产业服务业service industry tertiary industry主要经济指标major economic indicators国内生产总值GDP gross domestic product 商品和劳务币值总和,不包括海外收入支出国民生产总值GNP gross national product商品和劳务币值总和,包括海外收入支出人均国内生产总值GDP per capita宏观经济macro economy 互助基金mutual fund扩大内需expand domestic demand改善居民心理预期inspire the general public's confidence in the future needs鼓励增加即期消费encourage more immediate consumption长期国债long-term treasury bonds支付国债利息to service treasury bonds财政赤字和债务deficits and the national debt按原口径计算calculate on the base line按不变价格计算calculate at constant price按可比价格计算calculate at comparable price列入财政预算支出listed in the fiscal budget结售汇制度the system of exchange, settlement and sales经常项目顺差favorable balance of current account, surplus of current account开办人民币业务engage in Renminbi RMB business出口退税制度the system of refunding taxes on exported goods保证金台帐制度Deposit account system for processing trade分期付款pay by installment保值储蓄inflation-proof bank savings 抵押贷款collateralised loans 住房抵押贷款residential mortgage loan 货币主义者monetarist计划经济planned economy指令性计划mandatory plan技术密集型technology intensive大规模生产mass production经济林cash tree跟踪审计follow-up auditing流动性风险liquidity risk操作风险operational risk内部审计internal audit抛售bear sales配套政策supporting policies中国人民银行中央银行The People’s Bank of Chinacentral bank四大国有商业银行 4 major state-owned commercial banks中国银行Bank of china中国工商银行Industrial and Commercial Bank of Chinaand中国建设银行Construction Bank of China中国农业银行Agricultural Bank of China招商银行China Merchants Bank疲软股票soft stock配股allotment of shares实际增长率growth rate in real terms年均增长率average growth rate per annum投资回报率rate of return on investment外贸进出口总额total foreign trade value实际利用外资incoming overseas capital investment in place消费价格指数consumer price index CPI零售价格指数retail price index RPI生活费用价格总指数total price index of living cost生活费用income available for living expenses扣除物价因素in real terms / on inflation-adjusted basis居民储蓄存款residents’ bank savings deposit恩格尔系数食品开支占总支出的比例Engel coefficient基尼系数衡量地区差别Gini coefficient购买力平价法purchasing power parity PPP 衡量使用不同货币的两个国家或地区的经济水平、收入水平的一种计算法,用相等的汇率比较两种货币各自的国内购买力片面追求发展速度excessive pursuit of growth泡沫经济bubble economy 经济过热overheating of economy通货膨胀inflation实体经济the real economy经济规律laws of economics市场调节market regulation优化资源配置optimize allocation of resources规模经营优势advantage of economies of scale劳动密集型labor intensive市场风险market risk收紧银根tighten up monetary policy适度从紧的财政政策moderately tight fiscal policy信用紧缩credit crunch加强国有商业银行内部资金调度In state commercial banks, internal capital allocation should be im proved.合理划分贷款审批权限Limits of authority for examining and approving loans should be rationally defined.保证有市场、有效益、守信用企业的流动资金贷款ensure floating capital loans for well-performing and trustworthy enterprises which turn out the right products for the right markets启动民间投资attract investment from the private sector适销对路的产品the right products / readily marketable products国有企业state-owned enterprises SOEs集体企业collectively-owned partnership enterprises私营企业private businesses民营企业privately-run businesses中小企业small-and-medium-sized enterprises三资企业中外合资、中外合作、外商独资overseas-invested enterprises; foreign-invested enterprises C hinese-overseas equity joint ventures, Chinese-overseas contractual joint ventures, wholly foreign- ow ned enterprises存款保证金guaranty money for deposits货币回笼withdrawal of currency from circulation吸收游资absorb idle fund经常性贷款commercial lending经常性支出operating expenses再贷款re-lending; subloan支持国有大型企业和高新技术企业上市融资support large state-owned enterprises and high and inno vative technology companies in their efforts to seek financing by listing on the stock market改制上市An enterprise is re-organized according to modern corporate system so that it will get list ed on the stock market.进一步规范和发展证券市场further standardize and develop the securities market增加直接融资比重increase the proportion of direct financing完善股票发行上市制度improve the system for IPO and listing on stock markets中国证监会China Securities Regulatory Commission CSRC深圳证券交易所市Shenzhen Stock Exchange上海证券交易所Shanghai Stock Exchange综合指数composite index纳斯达克高技术企业板NASDAQ National Association of Securities Dealers Automated Quotation主板市场the main board通货紧缩deflation中国现代化建设分三步走的战略the three-step development strategy of China’’s level of developmen t is expected to be on par with the mid-ranking developed countries与世界经济的联系将更加紧密be more closely linked to the world economy中国巨大的市场潜力将逐步转化为现实的购买力The huge market potential that China enjoys will be turned into tangible purchasing power.适应市场经济需要的法律法规体系还不够健全The regulatory and legal system is not well establish ed as to adapt to the demand of market economy.经济管理体制可能会出现一些不适应The economic management system may not be readily adapted to the changes.一些行业和企业可能会受到冲击Some sectors of economy and some businesses may be adversely affected.立足中国国情,发挥自身优势proceed from national conditions in China and bring our advantages in to play扬长避短,趋利避害,迎接经济全球化的挑战foster strengths and circumvent weaknesses and rise to t he challenge of economic globalization瓶颈制约bottleneck constraints放权让利decentralization and interest concessions in late 1980s and early 1990s深化改革intensify reform; deepen one’s commitment to reform配套改革supporting concomitant reforms配套资金counterpart funds; local funding of提高经济效益improve economic performance; increase economic returns讲求社会效益value contribution to society; pay attention to social effect加速国民经济信息化develop information-based economy accelerate IT application in economy拉动经济增长fuel economic growth利改税substitution of tax payment for profit delivery费改税transform administrative fees into taxes债转股debt-to-equity swap头寸宽裕头寸紧缺in an easy position tight position朝阳产业sunrise industry招标投标制the system of public bidding for project充分发挥货币政策的作用give full play to the role of monetary policy实施积极的财政政策follow a pro-active fiscal policy向银行增发国债,扩大投资The government issued additional treasury bonds to banks to increase inv estment.再注资recapitalization放松银根to ease monetary policy信息经济IT economy外向型经济export-oriented economy息时代information age全球化globalization 全球性globality信誉风险reputational risk风险评级risk rating到期不还贷default on a loan资不抵债insolvency; be insolvent亚洲金融危机Asian financial crisis 1997-98投资贷款组合investment loan portfolio外汇储备充足sufficient foreign exchange reserves中国金融业问题problems with financial sector in China储蓄比例过高the excessively large proportion of savings in the money supply国有企业产负债率过高high leverage ratio of the state-owned enterprises,国有独资商业银行不良资产比例过高high ratio of non-performing loans of the state commercial ba nks少数中小存款金融机构不能支付到期债务insolvency of a handful of small and medium-sized finan cial institutions不良贷款non-performing loans防范和化解金融风险address financial risks提高企业借贷和行使民事责任的能力impro ve enterprises’ creditworthiness and ability to fulfil their civil liabilities监事会supervisory board实行谨慎会计制度adopt prudential accounting standards五级分类法划分贷款质量the five-category asset classification approach金融资产管理公司financial asset management companies分离和收回不良资产substantially reduce the ratio of non-performing assets分业管理、规模经营business segregation, economy of scale规范金融机构市场退出制度improve the market exit mechanism for financial institutions政策性银行state policy-related bank国家发展银行State Development Bank知识经济knowledge-based economy网络经济Internet-based networked economy社会主义市场经济中国socialist market economy社会市场经济德国social market economy新经济美国new economy中国光大银行Everbright Bank of China中国民声银行China Minsheng Banking Corporation Ltd.中信实业银行CITIC Industrial Bank中国进出口银行China EXIM Bank汇丰银行Hong Kong and Shanghai Banking Corporation HKSBC金融监管financial supervision中国人民银行法Law of the People’s Bank of China商业银行法Law of Commercial Banks保险法Law of Insurance证券法Law of Securities巴塞尔原则Basel Core Principles监管对象的行为有问题、管理机制不健全problems of supervised entities’ behavior and the unsound internal governance mechanism风险意识consciousness of risk prevention事前监管proactive regulation and supervisionaccount number 帐目编号depositor 存户pay-in slip 存款单a deposit form 存款单a banding machine 自动存取机to deposit 存款deposit receipt 存款收据private deposits 私人存款certificate of deposit 存单deposit book, passbook 存折credit card 信用卡principal 本金overdraft, overdraw 透支to counter sign 双签to endorse 背书endorser 背书人to cash 兑现to honor a check 兑付to dishonor a check 拒付to suspend payment 止付check 支票check book 支票本order check 记名支票bearer check 不记名支票crossed check 横线支票blank check 空白支票rubber check 空头支票check stub, counterfoil 票根cash check 现金支票traveler's check 旅行支票check for transfer 转帐支票outstanding check 未付支票canceled check 已付支票forged check 伪支票Bandar's note 庄票,银票banker 银行家president 行长savings bank 储蓄银行Chase Bank 大通银行National City Bank of New York 花旗银行Hongkong Shanghai Banking Corporation 汇丰银行Chartered Bank of India, Australia and China 麦加利银行Banque de I'Indo Chine 东方汇理银行central bank, national bank, banker's bank 中央银行bank of issue, bank of circulation 发行币银行commercial bank 商业银行,储蓄信贷银行member bank, credit bank 储蓄信贷银行discount bank 贴现银行exchange bank 汇兑银行requesting bank 委托开证银行issuing bank, opening bank 开证银行advising bank, notifying bank 通知银行negotiation bank 议付银行confirming bank 保兑银行paying bank 付款银行associate banker of collection 代收银行consigned banker of collection 委托银行clearing bank 清算银行local bank 本地银行domestic bank 国内银行overseas bank 国外银行unincorporated bank 钱庄branch bank 银行分行trustee savings bank 信托储蓄银行trust company 信托公司financial trust 金融信托公司unit trust 信托投资公司trust institution 银行的信托部credit department 银行的信用部commercial credit companydiscount company 商业信贷公司贴现公司neighborhood savings bank, bank of deposit 街道储蓄所credit union 合作银行credit bureau 商业兴信所self-service bank 无人银行land bank 土地银行construction bank 建设银行industrial and commercial bank 工商银行bank of communications 交通银行mutual savings bank 互助储蓄银行post office savings bank 邮局储蓄银行mortgage bank, building society 抵押银行industrial bank 实业银行home loan bank 家宅贷款银行reserve bank 准备银行chartered bank 特许银行corresponding bank 往来银行merchant bank, accepting bank 承兑银行investment bank 投资银行import and export bank EXIMBANK 进出口银行joint venture bank 合资银行money shop, native bank 钱庄credit cooperatives 信用社clearing house 票据交换所public accounting 公共会计business accounting 商业会计cost accounting 成本会计depreciation accounting 折旧会计computerized accounting 电脑化会计general ledger 总帐subsidiary ledger 分户帐cash book 现金出纳帐cash account 现金帐journal, day-book 日记帐,流水帐bad debts 坏帐investment 投资surplus 结余idle capital 游资economic cycle 经济周期economic boom 经济繁荣economic recession 经济衰退economic depression 经济萧条economic crisis 经济危机economic recovery 经济复苏inflation 通货膨胀deflation 通货收缩devaluation 货币贬值revaluation 货币增值international balance of payment 国际收支favorable balance 顺差adverse balance 逆差hard currency 硬通货soft currency 软通货international monetary system 国际货币制度the purchasing power of money 货币购买力money in circulation 货币流通量note issue 纸币发行量national budget 国家预算national gross product 国民生产总值public bond 公债stock, share 股票debenture 债券treasury bill 国库券debt chain 债务链direct exchange 直接对角套汇indirect exchange 间接三角套汇cross rate, arbitrage rate 套汇汇率foreign currency exchange reserve 外汇储备foreign exchange fluctuation 外汇波动foreign exchange crisis 外汇危机discount 贴现discount rate, bank rate 贴现率gold reserve 黄金储备money financial market 金融市场stock exchange 股票交易所broker 经纪人commission 佣金bookkeeping 簿记bookkeeper 簿记员an application form 申请单bank statement 对帐单letter of credit 信用证strong room, vault 保险库equitable tax system 等价税则specimen signature 签字式样banking hours, business hours 营业时间share, equity, stock 股票、股权negotiable share 可流通股份treasury /government bond 国库券/政府债券closed-end securities investment fund 封闭式证券投资基金open-end securities investment fund 开放式证券投资基金market capitalization 市值mark-to-market 逐日盯市clearing and settlement 清算/结算put / call option 看跌/看涨期权rights issue/offering 配股ADRAmerican Depository Receipt美国存托凭证/存股证GDRGlobal Depository Receipt 全球存托凭证/存股证institutional investor 机构投资者proprietary trading 自营market manipulation 市场操纵IPOInitial Public Offering新股初始公开发行securities 证券premium 溢价share capital 股本composite index 综合指数capital market 资本市场liquidity 流通性highly-leveraged institutionsHLI 高杠杆交易机构subscribe 申购underwriter承销商road show 路演primary market 一级市场information disclosure 信息披露blue chips 蓝筹股gilt-edged bond 金边债券rating agency 评级机构credit trading 信用交易open/close a position 建/平仓bond, debenture, debts 债券convertible bond 可转换债券corporate bond 企业债券fund manager 基金经理/管理公司fund custodian bank 基金托管银行p/e price/earning ratio 市盈率payment versus delivery 银券交付commodity/financial derivatives 商品/金融衍生产品margins, collateral 保证金bonus share 红股dividend 红利/股息retail / private investor 个人投资者/散户broker/dealer 券商insider trading/dealing 内幕交易prospectus招股说明书merger and acquisition收购兼并warrant 认股权证raised capital/proceeds 筹资component index 成份指数turnover rate 换手率monetary market 货币市场hedge fund 对冲基金self-regulatory organizationSRO自律组织issuer 发行人intermediary 中介机构secondary listing 第二上市secondary market 二级市场controlling shareholder 控股股东red chips红筹股junk bond 立即债券securities loan 融券financing 融资。
经济学人读译Emerging markets新兴市场The great slowdown大衰退
Emerging markets新兴市场The great slowdown大衰退A sticky spell for the emerging world carries warnings for its long-term growth 新兴世界面临的困难时期为其长期发展敲响了警钟①006 Leaders - Emerging markets.mp3(2.37 MB, 下载次数: 391)Jul 21st 2012 | from the print editionIN THE past decade emerging markets have established themselves as the world’s best sprinters. As serial crises tripped up America and then Europe, China barely broke stride. Other big developing nations paused for breath only briefly. Investors bet heavily that rapid growth in emerging markets was the new normal, while leaders from Beijing to Brasília lectured the world on the virtues of their state-centric economic models.在过去十年中，新兴市场作为全世界发展最快的经济体这一地位已经确立。
美国、欧洲相继深陷系列危机泥潭，踉踉跄跄；而中国却阵脚不乱。
其它发展中大国也只是在经济长跑中稍作喘息。
投资者认为新兴市场的快速增长是一种新常态，下注豪赌；中国和巴西的领导人则在世界各地发表演讲，宣传以国家为中心的经济模式的种种优点。
如何解决你的财务问题英语作文
如何解决你的财务问题英语作文Financial problems can be a source of stress and anxiety for many individuals. It is important to address these issues head-on in order to improve one's financial situation. There are several strategies that can be employed to solvefinancial problems.First and foremost, it is crucial to create a budget. By carefully tracking income and expenses, one can gain a better understanding of their financial situation and identify areas where spending can be reduced. Setting clear financial goals and prioritizing expenses can help individuals stay on track and make better financial decisions.Another important step in solving financial problems is to increase income. This can be achieved through various means such as seeking a higher-paying job, taking on a second job, or finding ways to earn additional income throughfreelance work or side hustles. By increasing income, individuals can better meet their financial obligations and save for the future.It is also essential to reduce debt in order to improve financial stability. This can be done by creating a debt repayment plan and focusing on paying off high-interest debt first. Consolidating debt or negotiating with creditors for lower interest rates can also help individuals reduce debt faster and save money on interest payments.Additionally, building an emergency fund is important to protect against unexpected expenses or financial setbacks. By setting aside a portion of income in a savings account, individuals can have peace of mind knowing that they have a financial safety net in place.Seeking professional financial advice can also be beneficial in solving financial problems. Financial advisors can provide personalized guidance and recommendations on howto improve financial health and achieve financial goals. They can help individuals create a comprehensive financial plan and make informed decisions about investments, retirement planning, and other financial matters.In conclusion, addressing financial problems requires careful planning, budgeting, and proactive steps to increase income, reduce debt, and build savings. By taking control of one's finances and seeking help when needed, individuals can overcome financial challenges and achieve long-term financial stability.。
Current Account Deficit
ECONOMICS REPORT - Current Account DeficitBy Mario RitterBroadcast: Friday, March 19, 2004This is Bob Doughty with the VOA Special English Economics Report.The United States recently reported a record deficit in its current account balance. The current account is a measure of the nation's trade with other countries. Last year, America's combined deficit on trade in goods, services and other economic activity rose to almost five-hundred-forty-two-thousand-million dollars. That is nearly thirteen percent more than the record current account deficit set in two-thousand-two.A deficit is often described as a shortage. This is true for the financial situation of an individual. For example, if you spend more than your earn, you must borrow from a creditor.However, economists see deficits differently. When money is taken away in one place, it becomes a credit someplace else. It all must balance. This does not mean that deficits are good necessarily. It just means that a deficit shows that another economic activity is increasing.In two-thousand-three, the United States had a huge trade deficit in goods. It had a moderate trade surplus in services of about sixty-thousand-million dollars. But, the question remains, how did the United States pay for everything it bought?The answer is that the United States paid in dollars. Other countries, then, accepted those dollars. They could then use the money to buy American goods, or they could buy American investments.That is what has happened since the United States developed large trade deficits in the nineteen-eighties. Countries that trade with the United States have increasingly invested in it. This foreign investment is recorded in the nation's financial account.Last year, other countries invested five-hundred-seventy-nine-thousand-million dollars more in America than it invested in them. That investment surplus is greater than the trade deficit.Foreign investment has become an important part of economic development in the United States. In nineteen-ninety-three, foreign money represented about nine-percent of all investment activity in America. By two-thousand, that had grown to almost twenty-five percent.So does this mean that trade deficits are cancelled out by foreign investment? The short answer is no. The widest measure of investment flow in and out of the country is called the capital account. It shows that the United States has a deficit of three-thousand-million dollars.This VOA Special English Economics Report was written by Mario Ritter. This is Bob Doughty.。
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Do Current Account Deficits Matter?AtishGhosh and Uma RamakrishnanTHE CURRENT account balance may seem to be an abstruse economic concept. But in countries that are spending a lot more abroad than they are taking in, the current account is the point a t which international economics collides with political reality. When countries run large deficits, businesses, trade unions, and parliamentarians are often quick to point accusing fingers at trading partners and make charges about unfair practices. Tension between the United States and China about which country is primarily responsible for the trade imbalance between the two has thrown the spotlight on the broader consequences for the international financial system when some countries run large and persistent current account deficits and others accumulate big surpluses.The IMF, whose mandate includes promoting and maintaining an open international trade and payments system, has recently started multilateral consultations on global imbalances with the major players: China, the euro area, Japan, Saudi Arabia, and the United States. Back to Basics tries to remove the emotion from the issue and examine whether current account surpluses and deficits even matter.Measuring the current accountA good starting point is to ask what a current account deficit or surplus really means and to draw insights from the many ways that a current account balance is measured. First, it can be expressed as the difference between the value of exports of goods and services and the value of imports of goods and services. A deficit then means that the country is importing more goods and services than it is exporting—although the current account also includes net income (such as interest and dividends) and transfers from abroad (such as foreign aid), which are usually a small fraction of the total. Expres sed this way, a current account deficit often raises the hackles of protectionists, who—apparently forgetting that a main reason to export is to be able to import—think that exports are "good" and imports are "bad."Second, the current account can be expressed as the difference between national (both public and private) savings and investment. A current account deficit may therefore reflect a low level of national savings relative to investment or a high rate of investment—or both. For capital-poor developing countries, which have more investment opportunities than they can afford to undertake with low levels of domestic savings, a current account deficit may be natural. A deficit potentially spurs faster output growth and economic development—although recent research does not indicate that developing countries tha t run current account deficits grow faster (perhaps because their less developed domestic financial systems cannot allocate foreign capital efficiently). Moreover, in practice, private capital often flows from developing to advanced economies. The advanced economies, such as the United States, run current account deficits (see chart), whereas developing countries and emerging market economies often run surpluses or near surpluses. Very poor countries typically run large current account deficits, in proportion to their GDP, that are financed by official grants and loans.One point that the savings-investment balance approach underscores is that protectionist policies are unlikely to be of much use in improving the current account balance because there is no obvious connection between protectionism and savings or investment.Third, the current account can be viewed in terms of the timing of trade. We are used to intratemporal trade—exchanging cloth for wine today. But we can also think of intertemporal trade—importing goods today (running a current account deficit) and, in return, exporting goods in the future (running a current account surplus then). Just as a country may import one good and export ano ther under intratemporal trade, there is no reason why a country should not import goods of today and export goods of tomorrow.Intertemporal theories of the current account also stress the consumption-smoothing role that current account deficits and surpluses can play. For instance, if a country is struck by a shock—perhaps a natural disaster—that temporarily depresses its ability to access productive capacity, then rather than take the full brunt of the shock immediately, it can spread out the pain over time by running a current account deficit. Conversely, research also suggests that countries that are subject to large shocks should, on average, run current account surpluses as a form of precautionary savings.When persistent is too persistentDoes it matter how long a country runs a current account deficit? When a country runs a current account deficit, it is building up liabilities to the rest of the world that are financed by flows in the financial account. Eventually, these need to be paid back. Common sense suggests that if a country fritters away its borrowedforeign funds in spending tha t yields no long-term productive gains, then its ability to repay—its basic solvency—might come into question. This is because solvency requires that the country be w illing and able to (eventually) generate sufficient current account surpluses to repay what it has borrowed. Therefore, whether a country should run a current account deficit (borrow more) depends on the extent of its foreign liabilities (its external debt) and on whether the borrowing will be financing investment tha t has a higher marginal product than the interest rate (or rate of return) the country has to pay on its foreign liabilities.But even if the country is intertemporally solvent—meaning that current liabilities will be covered by future revenues—its current account deficit may become unsustainable if it is unable to secure the necessary financing. While some countries (such as Australia and New Zealand) have been able to maintain current account deficits averaging about 4½ to 5 percent of GDP for several decades, others (such as Mexico in 1995 and Thailand in 1997) experienced sharp reversals of their current account deficits after private financing withdrew in the midst of financial crises. Such reversals can be highly disruptive because private consumption, investment, and government expenditure must be curtailed abruptly when foreign financing is no longer available and, indeed, a country is forced to run large surpluses to repay in short order its past borrowings. This suggests that—regardless of why the country has a current account deficit (and even if the deficit reflects desirable underlying trends)—caution is required in running large and persistent deficits, lest the country experience an abrupt and painful reversal of financing.What determines whether a country experiences such a reversal? Empirical research suggests that an overvalued real exchange rate, inadequate foreign exchange reserves, excessively fast domestic credit growth, unfavorable terms of trade shocks, low growth in partner countries, and higher interest rates in industrial countries influence the occurrence of reversals. More recent literature has also focused on the importance of balance sheet vulnerabilities in the run-up to a crisis, such as the extent of liability dollarization and maturity mismatches. It has also underscored the importance of the composition of capital inflows—for example, the relative stability of foreign direct investment versus portfolio and other ty pes of short-term investment flows. Moreover, weak financial sectors often lead to higher vulnerability to a reversal as banks borrow money from abroad and make risky domestic loans. Conversely, a flexible exchange rate regime, higher degree of openness, export diversification, financial sector development, and coherent fiscal and monetary policies are some factors that make a country with persistent deficits less vulnerable to a reversal.So, are deficits bad?A common complaint about economics is that the answer to any question is, "It all depends." I t is true tha t economic theory tells us that whether a deficit is good or bad depends on the factors giving rise to that deficit, but economic theory also tells us what to look for in assessing the desirability of a deficit.If the deficit reflects an excess of imports over exports, it may be indicative of competitiveness problems, but because the current account deficit also implies an excess of investment over savings, it could equally be pointing to a highly productive, growing economy. If the deficit reflects low savings rather than high investment, it could be caused by reckless fiscal policy or a consumption binge. Or it could reflect perfectlysensible intertemporal trade, perhaps because of a temporary shock or shifting demographics. Without knowing which of these is at play, it makes little sense to talk of a deficit being "good" or "bad": deficits reflect underlying economic trends, which may be desirable or undesirable for a country at a particular poi nt in time.Understanding The Current Account In The Balance Of PaymentsAugust 18 2009| Filed Under »Economics, Economy, Financial Theory, Insurance, International Markets, OptionsThe balance of payments (BOP) is the place where countries record their monetary transactions with the rest of the world. Transactions are either marked as a credit or a debit. W ithin the BOP there are three separate categories under which different transactions are categorized: the current account, the capital account and the financial account. In the current account, goods, services, income and current transfers are recorded. In the capital account, physical assets such as a building or a factory are recorded. And in the financial account, assets pertaining to international monetary flows of, for example, business or portfolio investments, are noted. In this article, we will focus on analyzing the current account and how it reflects an economy's overall position. (For background reading, see What Is The Balance Of Payments?)The Current AccountThe balance of the current account tells us if a country has a deficit or a surplus. If there is a deficit, does that mean the economy is weak? Does a surplus automatically mean that the economy is strong? Not necessarily. But to understand the significance of this part of the BOP, we should start by looking at the components of the current account: goods, services, income and current transfers.1.Goods - These are movable and physical in nature, and in order for a transaction to be recorded under"goods", a change of ownership from/to a resident (of the local country) to/from a non-resident (in a foreign country) has to take place. Movable goods include general merchandise, goods used for processing othergoods, and non-monetary gold. An export is marked as a credit (money coming in) and an import is noted as a debit (money going out).2.Services - These transactions result from an intangible action such as transportation, business services,tourism, royalties or licensing. If money is being paid for a service it is recorded like an import (a debit),and if money is received it is recorded like an export (credit).3.Income - Income is money going in (credit) or out (debit) of a country from salaries, portfolio investments(in the form of dividends, for example), direct investments or any other type of investment. Together,goods, services and income provide an economy with fuel to function. This means that items under thesecategories are actual resources that are transferred to and from a country for economic production.4.Current Transfers - Current transfers are unilateral transfers with nothing received in return. These includeworkers' remittances, donations, aids and grants, official assistance and pensions. Due to their nature,current transfers are not considered real resources that affect economic production.Now that we have covered the four basic components, we need to look at the mathematical equation that allows us to determine whether the current account is in deficit or surplus (whether it has more credit or debit). This will help us understand where any discrepancies may stem from, and how resources may be restructured in order to allow for a better functioning economy.The following variables go into the calculation of the current account balance (CAB):X = Exports of goods and servicesM = Imports of goods and servicesNY = Net income abroadNCT = Net current transfersThe formula is:CAB = X - M + NY + NCTWhat Does It Tell Us?Theoretically, the balance should be zero, but in the real world this is improbable, so if the current account has a deficit or a surplus, this tells us something about the state of the economy in question, both on its own and in comparison to other world markets.A surplus is indicative of an economy that is a net creditor to the rest of the world. It shows how much a country is saving as opposed to investing. What this means is that the country is providing an abundance of resources to other economies, and is owed money in return. By providing these resources abroad, a country with a CAB surplus gives other economies the chance to increase their productivity while running a deficit. This is referred to as financing a deficit.A deficit reflects an economy that is a net debtor to the rest of the world. It is investing more than it is saving and is using resources from other economies to meet its domestic consumption and investment requirements. For example, let us say an economy decides that it needs to invest for the future (to receive investment income in the long run), so instead of saving, it sends the money abroad into an investment project. This would be marked as a debit in the financial account of the balance of payments at that period of time, but when future returns are made, they would be entered as investment income (a credit) in the current account under the income section. (For more insight, readCurrent Account Deficits.)A current account deficit is usually accompanied by depletion in foreign-exchange assets because those reserves would be used for investment abroad. The deficit could also signify increased foreign investment in the local market, in which case the local economy is liable to pay the foreign economy investment income in the future.It is important to understand from where a deficit or a surplus is stemming because sometimes looking at the current account as a whole could be misleading.Analyzing the Current AccountExports imply demand for a local product while imports point to a need for supplies to meet local production requirements. As export is a credit to a local economy while an import is a debit, an import means that the local economy is liable to pay a foreign economy. Therefore a deficit between exports and imp orts (goods and services combined) - otherwise known as a balance of trade deficit (more imports than exports) - could mean that the country is importing more in order to increase its productivity and eventually churn out more exports. This in turn could ultimately finance and alleviate the deficit.A deficit could also stem from a rise in investments from abroad and increased obligations by the local economy to pay investment income (a debit under income in the current account). Investments from abroad us ually have a positive effect on the local economy because, if used wisely, they provide for increased market value and production for that economy in the future. This can allow the local economy eventually to increase exports and, again, reverse its deficit.So, a deficit is not necessarily a bad thing for an economy, especially for an economy in the developing stages or under reform: an economy sometimes has to spend money to make money. To run a deficit intentionally, however, an economy must be prepared to finance this deficit through a combination of means that will help reduce external liabilities and increase credits from abroad. For example, a current account deficit that is financed by short-term portfolio investment or borrowing is likely more ris ky. This is because a sudden failure in an emerging capital market or an unexpected suspension of foreign government assistance, perhaps due to political tensions, will result in an immediate cessation of credit in the current account.ConclusionThe volume of a country's current account is a good sign of economic activity. By scrutinizing the four components of it, we can get a clear picture of the extent of activity of a country's industries, capital market, services and themoney entering the country from other governments or through remittances. However, depending on the nation's stage of economic growth, its goals, and of course the implementation of its economic program, the state of the current account is relative to the characteristics of the country in question. But when analyzing a current account deficit or surplus, it is vital to know what is fueling the extra credit or debit and what is being done to counter the effects (a surplus financed by a donation may not be the most prudent way to run an economy). On a separate note, the current account also highlights what is traded with other countries, and it is a good reflection of each nation's comparative advantage in the global economy.What Is The Balance Of Payments?November 28 2009| Filed Under »Bonds, EconomicsThe balance of payments (BOP) is the method countries use to monitor all international monetary transactions at a specific period of time. Usually, the BOP is calculated every quarter and every calendar year. All trades conducted by both the private and public sectors are accounted for in the BOP in order to determine how much money is going in and out of a country. If a country has received money, this is known as a credit, and, if a country has paid or given money, the transaction is counted as a debit. Theoretically, the BOP should be zero, meaning that assets (credits) and liabilities (debits) should balance. But in practice this is rarely the case and, thus, the BOP can tell the observer if a country has a deficit or a surplus and from which part of the economy the discrepancies are stemming.The Balance of Payments DividedThe BOP is divided into three main categories: the current account, the capital account and the financial account. Within these three categories are sub-divisions, each of which accounts for a different type of international monetary transaction.The Current AccountThe current account is used to mark the inflow and outflow of goods and services into a country. Earnings on investments, both public and private, are also put into the current account.Within the current account are credits and debits on the trade of me rchandise, which includes goods such as raw materials and manufactured goods that are bought, sold or given away (possibly in the form of aid). Services refer to receipts from touris m, transportation (like the levy that must be paid in Egypt when a ship passes through the Suez Canal), engineering, business service fees (from lawyers or management consulting, for example), and royalties from patents and copyrights. When combined, goods and services together make up a country's balance of trade(BOT). The BOT is typically the biggest bulk of a country's balance of payments as it makes up total imports and exports. If a country has a balance of trade deficit, it imports more than it exports, and if it has a balance of trade surplus, it exports more than it imports.Receipts from income-generating assets such as stocks (in the form of dividends) are also recorded in the current account. The last component of the current account is unilateral transfers. These are credits that are mostly worker's remittances, which are salaries sent back into the home country of a national working abroad, as well as foreign aid that is directly received.The Capital AccountThe capital account is where all international capital transfers are recorded. This refers to the acquisit ion or disposal of non-financial assets (for example, a physical asset such as land) and non-produced assets, which are needed for production but have not been produced, like a mine used for the extraction of diamonds.The capital account is broken down into the monetary flows branching from debt forgiveness, the transfer of goods, and financial assets by migrants leaving or entering a country, the transfer of ownership on fixed assets (assets such as equipment used in the production process to generate income), the transfer of funds received to the sale or acquisition of fixed assets, gift and inheritance taxes, death levies, and, finally, uninsured damage to fixed assets.The Financial AccountIn the financial account, international monetary flows related to investment in business, real estate, bonds and stocks are documented.Also included are government-owned assets such as foreign reserves, gold, special drawing rights (SDRs) held with the International Monetary Fund, private assets held abroad, and direct foreign investment. Assets owned by foreigners, private and official, are also recorded in the financial account.The Balancing ActThe current account should be balanced against the combined-capital and financial accounts. However, as mentioned above, this rarely happens. We should also note that, with fluctuating exchange rates, the change in the value of money can add to BOP discrepancies. When there is a deficit in the current account, which is a balance of trade deficit, the difference can be borrowed or funded by the capital account. If a country has a fixed asset abroad, this borrowed amount is marked as a capital account outflow. However, the sale of that fixed asset would be considered a current account inflow (earnings from investments). The current account deficit would thus be funded.When a country has a current account deficit that is financed by the capital accou nt, the country is actually foregoing capital assets for more goods and services. If a country is borrowing money to fund its current account deficit, this would appear as an inflow of foreign capital in the BOP.Liberalizing the AccountsThe rise of global financial transactions and trade in the late-20th century spurred BOP and macroeconomic liberalization in many developing nations. With the advent of the emerging market economic boom - in which capital flows into these markets tripled from USD 50 million to USD 150 million from the late 1980s until the Asian crisis - developing countries were urged to lift restrictions on capital and financial-account transactions in order to take advantage of these capital inflows. Many of these countries had restrictive macroeconomic policies, by which regulations prevented foreign ownership of financial and non-financial assets. The regulations also limited the transfer of funds abroad. But with capital and financial account liberalization, capital markets began to grow, not only allowing a more transparent and sophisticated market for investors, but also giving rise to foreign direct investment. For example, investments in the form of a new power station would bring a country greater exposure to new technologies and efficiency, eventually increasing the nation's overall gross domestic product by allowing for greater volumes of production. Liberalization can also facilitate less risk by allowing greater diversification in various markets.。