2015金融英语第二节课.pptxVIP

Section 2;2.1. Overview of Credit; 1. Temporization: The separation of the ownership of funds or goods and the right to use them is temporary. 2. Repayment: the temporary transfer of funds or goods is conducted with repayment of funds or goods plus interests as prerequisites. 3. Profitability: When creditors transfer the right to use funds or goods they require an added value to the funds or goods lent out when repayment is made. 4.Risk:In credit activities exists default risk, a risk that debtors will possibly fail to make repayment on maturity.;2.1.3. The functions of credit;2.2 The Forms of Credit;Features of credit 1. It is closely linked to a certain commodity transaction. 2. The movement of commercial credit is in line with that of industrial capital（产业资本）. 3. It is the most convenient means for buyers to solve the problem of shortage of means of exchange. ;Limitations of commercial credit;2. Banker’s credit 银行信用;The features of banker’s credit;3. Public credit 公共或国家信用;In modern economy public credit plays two important roles:;4. Consumer’s credit 消费信用;Forms of consumer’s credit ;5. Private credit 个人信用;The features of private credit; The negative effects of private credit;  2.3 Money Creation;Banks lend a portion of their deposits keeping the balance as reserves. Reserves are vault cash and the bank’s deposits at the central bank. The Reserve ratio is the ratio of reserves to deposits a bank keeps as a reserve against cash withdrawals. If banks choose to hold an additional amount, this is called the excess reserve.;A bank accepts deposits, keeps a portion as reserves, and lends out the rest. The borrower gets the loan; he does not draw cash, but redeposit in another bank. The second bank will again grant loans after keeping the reserves. …… Each time the money is deposited and a bank lo