Vocabulary. 1. Read and translate the dialogue in pairs:

A. DIALOGUE

1. Read and translate the dialogue in pairs:

Foreigner: Financial markets are generally classified as money or capital markets and primary or secondary markets. Do you follow this classification?

Ukrainian: Yes, we do. But structurally we divide our financial market into hard-currency market, a bank credit market, debt and equity markets and the market of gold and precious metals.

Foreigner: I see. My experience in Ukraine tells me that your investors prefer operations in the hard currency market to investing in the real sector of your economy.

Ukrainian: Yes, our capital markets are thin, weak and vulnerable.

Foreigner: It’s a pity, because the debt market, for one, is a powerful instrument of monetary policy. Many governments issue bonds to solve their financial problems and to cover budget deficits.

Ukrainian: And how is the international bond market performing this year?

Foreigner: Volumes of issuance have been rather high, through fewer bonds have appeared from emerging markets of Eastern Europe.

Ukrainian: Investors are still viewing borrowers in emerging markets too risky, I suppose. Western sovereign borrowers are the main players in the market, aren’t they?

Foreigner: Well, yes, but many are trying to slow down their borrowing and reduce their national debt.

Ukrainian: This leaves room for other borrowers, right?

Foreigner: Yes, supranationals have diversified tremendously, both in their products and markets. Corporate borrowers are also very active.

Ukrainian: But after the crisis investors have become more cautious, haven’t they?

Foreigner: That’s right. Credit ratings of borrowers have become much more important. Investors demand transparency and liquidity. Borrowers are finding it much harder and more expensive to raise sufficient funds on the international debt market.

Ukrainian: How has the introduction of the Euro affected the bond market?

Foreigner: Some are thinking of Euro-denominated bond issues as the bond markets are moving away from the dollar in favour of the Euro. The competition is becoming keener.

Ukrainian: We are entering a new and turbulent phase in the debt markets. Many people believe that the worst is yet to come.

structurally – структурно

hard-currency market – ринок твердої валюти

bank-credit market – ринок банківських кредитів

debt market – ринок позичкового капіталу

equity market – ринок акцій

market of gold and precious metals – ринок золота та дорогоцінних металів

real sector – реальний сектор

thin – вузький

issuance – випуск (акцій)

emerging markets – ринки, що розвиваються

sovereign borrower – суверенний позичальник, держава-позичальник

cautions – обережний

credit rating – кредитний рейтинг

Euro – євро (валюта)

turbulent – неспокійний, бурхливий

2. Read the dialogue, translate the Ukrainian remarks into English and act it out:

Ukrainian: З моєї точки зору, ми вступили в дуже складний період розвитку ринку облігацій. Все більш важливу роль відіграють великі інституціональні інвестори, об’єми випусків облігацій зростають, конкуренція на ринку загострюється.

Foreigner: Besides, big investors have power to demand more transparency and liquidity of the market.

Ukrainian: Нещодавня фінансова криза на ринках Азії здійснила негативний вплив на ринок позичкового капіталу. Інвестори почали проявляти велику обережність. Багато корпоративних позичальників відчувають труднощі із пошуком необхідних їм засобів.

Foreigner: Nevertheless the competition in the market in an advantage to borrowers who are trying to extend maturities.

Ukrainian: Так, це правда. Але інвестори можуть відмовитись від інвестування своїх коштів в облігації та перемістити свій капітал на більш привабливі фінансові ринки.

Foreigner: Of course, the bond market has become a dangerous place for borrowers and investors. However, the importance of our investor for the bond market continues to grow.

Ukrainian: Це, безумовно, так. Політична, економічна та фінансова стабільність вашої країни дозволяє вам успішно конкурувати на цьому ринку і здійснювати на нього великий вплив.

3.Make up a dialogue on the following:

You have to explain to your friend the structure of the bond market.

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