商务英语阅读（第二版） 王关富 Unit9 Econ-Beyond bretton woods 课后答案

Unit 9

Beyond Bretton Woods 2

Exercises

1. Answer the questions on the text:

1) According to the article, what is the essence of “quantitative easing”

restarted by the Fed?

Printing money to buy government bonds.

2) Why is no one satisfied with today’s international monetary system?

Because:

Reason 1: Dominance of the dollar as a reserve currency and America’s management of it fail to reflect the realities of the world economy and leave others vulnerable to America’s domestic monetary policy.

Reason 2: The system has fostered the creation of vast foreign-exchange reserves, particularly by emerging economies, thus poor countries lend to rich ones and lose investment opportunities.

Reason 3: Scale and volatility of capital flow render unsteadiness for emerging economies.

3) What is “trilemma” according to the text?

The independence of domestic monetary policies, stability of exchange rate and perfect capital mobility can’t be realized at the same time. One must give up one factor to uphold the other two.

4) What is the reason for a freer capital flow in these days?

Globalization as much as to the removal of restrictions.

5) Why are countries unwilling to have their currency exchange rate to rise

greatly and how do they control it?

Because abrupt rise in exchange rate would cripple export and countries want an undervalued currency to encourage export-led growth, so they buy foreign exchange to stem the rise.

6) How is “Bretton Woods 2”created, according to the author?

Emerging economies are coping the behavior of China, keeping their exchange rate at a low level so as to maintain their international competitiveness, thus they have to be tied to US dollars. This phenomenon then results in Bretton Woods 2. 7) What is “Triffin dilemma”?

The conflict between the benefits and costs of a country with a reserve currency running a large current account deficit. The reserve-currency country enjoys the consumption benefit of running a trade deficit, while the rest of the world benefits from the additional liquidity, which helps facilitate trade. The cost comes from the declining value and credibility of any currency which runs a persistent trade deficit - eventually leading to a reluctance of creditors to hold the reserve currency.

8) Why can’t SDRs become a central reserve asset?

Because as Mr Eichengreen writes: “No global government… means no global central bank, which means no global currency.

9) According to the text, what is the measure that the G20 could possibly take

to rebalance world economy?

It can develop a plan with target ranges for current-account balances and real exchange rates and make it supported by peer pressure rather than explicit sanctions.

10) What can be inferred from the title “Beyond Bretton Woods 2” in relation to

the world economy?

There are probably two results of the world economy:

One is that if America’s economy recovers and its medium-term fiscal outlook improves, the pace at which capital shifts to the emerging world will slow. And if China makes its currency more flexible and its capital account more open in good time, the international monetary system will be better able to cope with continued financial globalisation and a wide growth gap between rich and emerging markets.

The other is that if the world’s biggest economy stagnates and the

second-biggest does not change its monetary policy, a rigid monetary system will eventually buckle.)

2. Fill in each blank of the following sentences with one of the phrases in the list given below:

1) The latest statistics indicate that this region’s economic recovery is tied to higher

education.

2) According to financial news, this nation’s currency will appreciate against euro in real terms.

3) The couple described their narrow escape from the earthquake in New Zealand as

they were inside the church when it began to fall apart.

4) If you never take initiative to make it happen, this scheme is only something on paper. 5) At times of critical moment, one must subordinate passions to reasoning to

avoid any possible blunders.

6) Over two million migrant workers flooded into Beijing last year from all parts of

China to seek potential opportunities for personal development.

7) Thousands of city school teachers stand to lose their jobs under a tough budget

that is set to unveil this coming Thursday.

8) The car dealer guarantees that if customer is unhappy with the model he

purchases, whether on a bill of sale or hire purchase, he can totally swap it for a new one.

9) Authorities in Zimbabwe have issued a new mega bank note in an attempt to cope with the troubled African country's runaway inflation. 10) Economists use the term liquidity to describe the ease with which an asset can be

converted into the economy's medium of exchange.

3. Match the terms in column A with the explanations in column B: A B 1) reserve currency a) Ability of money to move across national

boundaries freely in pursuit of higher returns. 4 2) treasury bond b) A government monetary policy

occasionally used to increase the money supply by buying government

securities or other securities from the market. 7 3) currency war c) The actions of a central bank, currency

board or other regulatory committee that determine the size and rate of growth of the money supply. 5 4) capital mobility d) A mechanism used by central banks to provide

financial institutions with access to funds to satisfy reserve requirements and to increase liquidity over longer periods. 8

5) monetary policy e) A currency held by many governments and as

part of their foreign exchange reserves and also used as the international pricing currency for products traded on a global market. 1 6) Special Drawing Right (SDR) f) A condition in international affairs where

countries compete against each other to

achieve a relatively low exchange rate for their home currency. 3 7) quantitative easing g) A marketable, fixed-interest U.S. government

debt security with a maturity of more than 10 years. 2 8) lending facility h) A period of time in which loans are lent by the

government and banks in an unrestrained way . 9 9) credit binge i) A situation where a country's total import of

goods, services and transfers are greater than its total export of goods, services and transfers..10 10) current account deficit j) An international type of monetary reserve

currency created by the International

Monetary Fund and used as a supplement to

the existing reserves of member countries.. 6

4. Translate the following into Chinese:

如果国际组织间举行一场全球性的声望比赛，国际货币基金组织毫无疑问会是最后一名。在过去30年里，这家位于华盛顿的机构以提供财政资助的方式给多个政府强加苛刻的条件，在非洲、亚洲和拉丁美洲地区激起了人们的恐惧和反感。随着世界经济强劲增长，当它的作用在近十年早期削弱到接近无关紧要的地步时，几乎没人同情它。2007年当选为总裁的法国人卡恩（Dominique Strauss-Kahn）警告它的董事们说：“国际货币基金组织的存在现在已经到了生死攸关的时刻。”

然而，国际货币基金组织突然间又成为了瞩目的焦点，这次它扮演了一个人们不熟悉的新角色：这家机构被认为是当今的救世主，有能力拯救正在崩溃的世界经济。4月2日在伦敦召开的20国首脑会议的主要成果就是达成了一项协议，将国际货币基金的资金额度提高三倍至七千五百亿美元，并且同意其自行额外发行两千五百亿美元。这笔钱的一部分将用来资助那些突然陷入经济困难的国家，另一部分则为衰退的世界经济提供更广泛更充裕的流动性。

但是这些额外的钱只是整个事件的一部分。随着新资金的注入，国际货币基金的运作方式至少在理论上将发生重大变化。未来欧洲国家不再象现在一样拥有推选总裁的自主权。同时通过对其秘密股权体制或配额体制的改革，美国和其他发达国家对其政策的支配将让步于一个更为平衡的管理体系，其中如巴西，中国和俄罗斯等发展中国家有更多发言权。国际货币基金的关注范围也待转变，20国集团希望它能以全球经济警察的角色发挥更为积极的作用，监管主要发达经济体及欠发达经济体的政策，当发现危险的行为时吹哨示警。从理论上讲，国际货币基金组织应能反映出全球经济秩序的变化和因危机而实施的更严格的金融监管。

5. Fill in each of the following gaps with one of the sentences given below:

1) By importing savings from abroad, poor countries can invest more than they

are able to set aside from their own meagre output. 2) They also benefit from more sophisticated banking.

3) Foreign investors may have a better nose for boardroom shenanigans and a

strong incentive to protect minority shareholders.

4) In practice, open countries do seem to achieve lower inflation though there is

scant evidence that they run smaller budget deficits.

5) But if foreign capital promotes these three virtues, then the study may have

inadvertently strained out much of the benefit of financial globalisation.

Supplementary Reading

Weighed Down

1. It is considered to be the surest way to lend to states because __________.

A. they collect tax nationwide as sustainable revenue

B. they administrate their countries and are less likely to collapse C. they won’t close up shops and flee their creditors D. Both A and B ∨

2. According to the text, government default is __________.

A. the absence of duty that a government should perform

B. the inability or refusal of a government to pay back money it has borrowed

∨

C. the admittance of debt that a government owes D. None of the above

3. All of the following are the consequences of Greek government debt except

__________.

A. instabilities in global financial markets B. depreciation of euro

C. credit downgrade and major political problems ∨ D. stock markets elsewhere are impacted

4. By quoting all these statistics of government debt by OECD in the third

paragraph, the author mainly indents to _________.

A. disclose how these debts are shifted from private-sector to public-sector B. signal the potential crisis that the world economy faces in the near future ∨ C. warn the impact caused by the Great Recession on global financial markets D. reveal the current pressure rendered by unsustainable mountains of debt 5. Why is the result of mounting sovereign debt NOT automatically dangerous?

A. Different countries have different levels of tolerance and abilities to finance

the debt. ∨

B. U.S. Treasury bills is a safe haven to help finance the deficits.

C. Japan's ample domestic sources of funds find no trouble financing its

deficits.

D. All of the above.

6. What does economist Carmen Reinhart mean by saying, “…growth prospects are

really taking a hit” ?

A. Growth prospects are taking initiative to look forward.

B. Growth prospects are getting popular among general public. C. Growth prospects are suffering a defeat. ∨

D. Growth prospects are drawing more and more attention.

7. What is U.S. President Barack Obama’s attitude towards government debt?

A. Objective and positive. B. Serious and decisive. ∨ C. Practical but pessimistic. D. Indifferent but reluctant

8. What is the measure that euro zone takes to cope with Greek crisis?

A. Collective assistance to Greece and great effort to stabilize EU’s economy.

∨

B. Elimination of impact by dismissing Greece as an EU member. C. Abandoning euro as a common currency.

D. Changing the way the euro zone works by alternating presidency.

9. Greece Prime Minister George Papandreou’s policy can be described as

__________.

A. high-pressured B. softened C. agreeable D. tough ∨

10. From the context, we can infer that “skip town” in the last sentence probably

means __________.

A. making cheap promises

B. disappearing without notifying anyone ∨ C. omitting the needs of certain towns and cities D. making hard choices

8. What is the measure that euro zone takes to cope with Greek crisis?

A. Collective assistance to Greece and great effort to stabilize EU’s economy.

∨

B. Elimination of impact by dismissing Greece as an EU member. C. Abandoning euro as a common currency.

D. Changing the way the euro zone works by alternating presidency.

9. Greece Prime Minister George Papandreou’s policy can be described as

__________.

A. high-pressured B. softened C. agreeable D. tough ∨

10. From the context, we can infer that “skip town” in the last sentence probably

means __________.

A. making cheap promises

B. disappearing without notifying anyone ∨ C. omitting the needs of certain towns and cities D. making hard choices

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