Unit 9 You can learn how to ride the busines cycle

Uint9

II. Basic Listening Practice

1.    Script

M: Third World countries must improve their economies if they want to raise their citizen’s standard of living.

W: But how can they do that when developed countries control world trade?

Q: Which of the following is true?

2.    Script

W: What did Professor Smith mean when he said that whenAmericasneezes,Britain

catches a cold?

M: He meant that what is happening toAmerica’s economy today will have an effect onBritain’s economy in the future.

Q: What did the professor say?

3. Script

M: Your government gives financial subsidies to certain industries, creating unfair competition. This is wrong.

W: But your government sets up import tariffs, which have the same effect.

Q: What can we learn from this conversation?

4. Script

M: The price of oil is going through the roof. It is going to cause economic pain all over the world.

W: I think the high price of oil is good. It will make people more careful in using their cars, and also make them seek alternative fuels which will probably be better for the environment.

Q: What do the man and the woman think about the high price of oil?

5. Script

W: Industries that pollute should either be closed down or made to clean up their act. I’m tired of breathing dirty air.

M: It’s not that simple. People need jobs and that means we need industry. Besides, the sunset looks especially beautiful through the smog.

Q: What does the man say about smog?

Keys: 1.A   2.C   3. D   4.B   5.A

III. Listening In

Task 1: Is GDP really so important ?

Script

Joan:   It seems like a miracle thatChina’s GDP has been growing so fast. The growth last year was over eight percent again.

Vincent: Excuse me, it just slipped my mind. What does GDP stand for?

Joan:It stands for gross domestic product.

Vincent: SinceChina’s GDP is increasing so rapidly, its economy must be healthy.

Joan: It’s hard to say. Along with the economic growth, there are some problems. Pollution; less farmland; a wide economic gap between the coastal areas and the interior, between the urban and the rural residents, and between the high-income groups and the low-income groups; to name just a few.

Vincent: What do you suggest for the Chinese economy then?

Joan:   I’m not an economist, and I’m not in a position to give advice. But I notice the Chinese government is shifting its focus from GDP growth to more balanced, sustainable economic and social development.

Vincent: So, you mean GDP may not be an accurate indicator of a country’ economic performance?

Joan:   Yeah. In my opinion, GDP is simply a gross measure of market activity, of money changing hands. It makes no distinction whatsoever between the desirable and undesirable.

Vincent: Now, I understand why some years ago the GDP of theUnited Stateswent up, but the President failed to win re-election.

Joan:   Right. In spite of the larger GDP, American people found life harder. Many worked longer hours for less pay. Only the rich forged ahead.

Vincent: Your talk was really enlightening. I’m getting more interested in economics.

1.      What is true ofChina’s GDP growth for the recent two years?

2.      What is the new goal for the Chinese government?

3.      What does the woman say about the GDP figure?

4.      What happened to the President after the American GDP went up some years ago?

5.      What is the dialog mainly concerned about?

Keys: 1.C   2.D   3.C   4.A   5.B

Task 2: A Cheap Parking Lot

Script

Before going to Europe on business, a woman drove her new Rolls-Royce to a (S1) downtown bank in New York City and went in to ask for a (S2) loan of $5,000. The bank officer said the bank would need some kind of (S3)security for the loan, so the women handed over the keys to her Rolls-Royce.

The car was parked on the street in front of the bank. The bank (S4) agreedto accept the car as collateral for the loan. The bank’s president and its officers all enjoyed a good laugh at the woman for using a $250,000 Rolls-Royce as collateral (S5) against a $5,000 loan. An employee of the bank then (S6) proceeded to drive the Rolls into the bank’s underground garage and parked it there.

Two weeks later, the woman walked throuh the bank’s doors and asked to (S7) settle up her loan and get her car back. “(S8) That will be $5,000 principal, and $20.30 in interest,” the loan officer said. The woman wrote out a check and started to walk away.

“Wait, Miss,” the loan officer said, “(S9) We’re very happy to have had your business, and this transaction has worked out very nicely, but we are a little puzzled. While you were away, we checked you out and found that you are a multi-millionaire. What puzzles us is why you would bother to borrow $5,000.”

The woman replied: “(S10) Where else in Manhattan can I park my car for two weeks for only $20.30 and expect it to be there when I return?”

Task3: Doha Round

Script

Rich and poor nations struck an historic deal on Sunday to cut billions of dollars in farm subsidies, create more open industrial markets, and resume world trade talks that could boost global growth.

After five days of negotiations, the World Trade Organization’s 147 member states formally agreed on a framework that lays down the guidelines for its Doha Round, which has been in trouble since the collapse of talks almost a year ago in Cancun,Mexico. Failure in the negotiations could have delayed further trade liberalization for years.

After an all-night negotiation, key WTO members, including theUnited States, the EU,Brazil, andJapan, on Saturday had agreed to the elimination of export subsidies at a date yet to be set, which has long been a key developing-country demand, to limit other subsidies, and to lower tariff barriers.

Rich nations welcomed the new deal, which commits them to a plan to cut back on the huge subsidies they spend on farmers and give developing nations better access to world markets. U.S. Trade Representative Robert Zoellick called the agreement a “crucial step for global trade”. He said, “Tonight, 147 economies have ensured that 2004 will go down as a productive year for the Doha trade negotiation. There’s a lot of work yet to be done. But today’s framework is a milestone.”

A delegate fromMauritius, which has taken a leading part in the WTO talks on behalf of African nations, said the so-called Group of 90 developing countries could live with the text even if it did not get everything it wanted. The agreement makes it clear that the poorest countries will not be forced to contribute to market opening in any area, including services.

1.      Why of the following would be the best title for the passage?

2.      How many countries participated in the WTO negotiations and how long did the negotiations last?

3.      What will happen to export subsidies after the negotiations?

4.      Who are supposed to reduce their agricultural subsidies?

5.      What are poor countries supposed to do?

Keys: 1.D   2.B   3.C   4.A   5.D

IV. Speaking Out

MODEL 1   Shop till you drop.

Susan: Still reading about how the bubble’s going to burst in theU.S.economy?

John:Yeah, and this is an interesting article called, “Shop Till You Drop.”

Susan: The rhyme between “shop” and “drop” is cathy, but what does it mean?

John: “Shop” and “drop”? You know: buy, buy, and buy, until you fall down from exhaustion.

Susan:Is that what the author is telling people to do—go out and spend money.

John:No, he’s afraid that consumer consumption is too high at 70 percent of the GDP.

Susan:You mean 70 percent of the gross domestic product in theUnited States?

John:That’s right.FranceandJapanare worried with 55 percent of the GDP.

Susan:  What’s behind this big rush to buy things inAmerica?

John: I  Apparently the search for status symbols: luxury cars, holiday homes.

Susan:Amazing. So many people earn enough to buy a Mercedes and two houses.

John:They don’t; they buy on credit. And too much debt may burst the bubble.

MODEL2   The Chinese are working miracles.

Script

Susan:Hey, John!

John: Hey! Look at this headline!China’s foreign trade should reach $1 trillion this year!

Susan:Are you sure the figure is correct? How can they keep up such rapid growth for so many years running?

John:A senior official of the Ministry of Commerce said so in Beijing Wednesday.

Susan:  As far as I know,China’s foreign trade volume was already $851.2 billion last year, a 37.1 percent jump over the previous year. That volume ranked fourth in the world, following only theUnited States,Germany, andJapan.

Susan:  But the Chinese are working miracles. In the first half of this year, foreign trade reached $523 billion, up 39.1 percent over last year.

John:I wonder how it can grow so fast.

Susan:TheU.S.economy has been very good. Booming consumption has created opportunities forChina’s exports.

Susan:Is that the only one reasonChina’s exports have increased? No other factors?

John: Chinaencourages exports. Exporters can get rebates from the customs department.

Susan:What’s happening with Chinese imports?

John:Well,Chinahas met her commitments to the World Trade Organization since she joined two and half years ago. She has gradually been decreasing tariffs and strengthening intellectual property rights. She has opened her doors to the outside world wider. All these changes have led to an increase in her imports.

Susan:You seem to be looking atChinathrough rose-colored glasses.

John:Chinais not without her problems. Some of her state-owned industries have only a blunt competitive edge. They have a weak anti-risk capability. Some industries still depend on trade protectionism.

Susan:  John, I really admire your wide knowledge. I think you’ll be in line for Nobel Prize in Economics some day.

John:  You’re just pulling my leg again.

MODEL3   I don’t know what to say in the seminar.

Script

Nora: Hey John, Professor Brown asked us to discuss the economic gap between the rich and poor nations. But I don’t know what to say in the seminar.

John: If you don’t know anything, don’t say anything.

Nora: But participation counts for 20 percent of the total grade. Will you tell me what you’re going to talk about?

John: Will, according to a report by the World Economic Forum, the technology gap between rich and poor countries is closing.

Nora: Sounds too good to be true. Only a few years ago, I heard that the gap between the North and the South was widening. Many people in developing countries are still struggling below the poverty line.

John: Different people may have different opinions on this issue. The World Bank also says the gap is narrowing.

Nora: Still, it sounds stange to me. How could it be possible now that theUnited Statesand other industrialized nations are developing IT so fast?

John: But it’s easier for others to copy new technology. Experts say the technological advantages of the developed countries are getting smaller.

Nora: I’m still unconvinced. Does a narrower technology gap nessarily mean a narrower economic gap?

John: Today, information tecnology is the most powerfull engine for economic growth, so the narrowed technology gap leads to a narrowed economic gap.

Nora: OK, I’ve learned a lot from you. Now I feel more confident about the seminar.

Now Your Turn

Task 1

SAMPLE DIALOG

Pamela: Still reading about how the bubble’s going to burst in the real estate market?

Simon:Yeah, and this is an interesting article, though what it says may not be true.

I think the market is going to be stable.

Pamela:I agree. At present, the government’s policy seems to be stabilizing

property prices. But I don’t understand why some people spend so much money on real estate? What was behind this big rush to buy houses last year?

Simon:Since the interest rates on bank savings were quite low, and the stock market remained a bear market for a long time, it’s not surprising that investment in housing property rose.

Pamela:  Were there any other reasons for the race to buy houses last year?

Simon:Yeah, a number of other reasons: Some buyers searched for status symbols, some wanted to live more comfortably, and still others expected further rises in property values.

Pamela:Amazing. So many people earn enough to buy a large apartment or even two houses.

Simon: Most of them don’t; they buy on credit.

Pamela:The article says too much debt may burst the bubble.

Simon:But I think the market will remain stable, at least in the near future.

V. Let’s Talk

Script

Journalist: Professor Williams, some people argue that the GDP does not reflect the true nature of the economy. What’s your opinion of the GDP measurement?

Professor: The GDP is a core index in the calculation of a national economy. But it shows only whether the economy has grown in a region or a country. What isn’t taken into account is the price being extacted from our natural resources and environment to support growth.China’s more than eight percent annual GDP growth in the past depended a lot on high energy consumption and uncontrolled discharge of wastes.

Journalist: Can“green GDP” solve the problems?

Professor: As a brand-new method of calculating a national economy, the“green GDP” index system takes into consideration both the economy and environmental costs. It deducts environmental costs from the traditional gross domestic product. In other words, green GDP equals traditional GDP minus the costs of resources and environmental damage. Green GDP can be regarded as “the genuine GDP”, for it not only reflects economic growth, but also shows the quality of that growth.

Journalist: How will the“green GDP” influence enterprises?

Professor: The system will have direct and far-reaching influence on enterprises. Some enterprises attach importance only to costs directly related to their growth, but turn a blind eye to serious damage to resources and the environment. On the other hand, the macroeconomic departments need to analyze the real economic balance sheet. It is necessary for those departments to calculate the environmental costs in resulting from the activities of enterprises. The“green GDP”index system will effectively restrict an enterprise’s impulse to expand at the expense of resources and the environment. In the long run, the benefits green GDP brings will outweigh the demands imposed on enterprises. China is planning to introduce the“green GDP”index system to ensure balanced, sustainable development and secure the prosperity of future generations.

VI.  Further Listening and Speaking

Task1: How was the problem resolved ?

Script

Keys: 1.C   2.D   3.D   4.A   5.B

Task 2: Price rises but inflation stays low.

Script

Keys: 1.F   2.T   3.F   4.T   5.T

Task3:  Cars sell well inChina.

Script

Although automobile prices inChinaare among the highest in the world, cars are still selling like hotcakes, the Beijing-based reported.

Statistics show thatChinahas been the top consumer of limousine brands such as Rolls-Royce and Bentley, and their sales volume accounts for almost 20 percent of the total in the whole Asian continent.

According to German figures,Chinahas been the biggest market for BMW and Mercedes-Benz in the world, combined with a sales volume between 6,000 to 7,000 units every year.

The newspaper said various famous international car makers are competing with one another now for more market share inChina. Mercedes-Benz is cooperating with Chinese institutions on car research and plans to establish a design center here. Meanwhile, Volkswagen, also fromGermany, has set up a new lab center in Beijing. The founding of these research and design centers indicates that the competition among multinational car producers inChinanow includes research in addition to sales.

As a price gap exists betweenChina’s and the international auto market, the returns on luxury cars from the domestic market are much higher than the five-percent profit margin in the international market. Over 30 percent of the manufacturers’gains resulted from spare part sales.

Considering the steadying market demand experts estimated that the prices of luxury cars would not decrease by large margins this year.

The newspaper noted that major consumers of luxury cars inChinaare entrepreneurs, professional managers of foreign companies, professionals with high incomes,and young white-collar workers.

News Report

Highlights of the Detroit International Auto Show

Script

The latest concept cars were unveiled at the North American International Auto Show in Detroit on Monday.

More than 700 cars featuring the latest styles and technology will be on display for public viewing from January 12th through the 21 st.

One of the cars on display, Honda’s pilot Sports Utility Vehicle, is made of an impressive 90 percent recyclable material. Designed to be family friendly, it has the largest cargo and passenger loading capability in its class.

Another of Honda’s concept cars, the Acura RD-X was created to perform well on both city and country roads. Targeting young urban professionals, the futuristic RD-X features rear seating that can be folded away to provide extra cargo room, power rear doors that open to the side, making it easy to load large items easily in even the tightest of spaces, and side doors that provide a large entryway in minimal space.

The Mitsubishi Hybrid Sports Pack was designed with the outdoors enthusiast in mind. It features a waterproof interior, a freshwater shower complete with retractable shower head and refillable water tank built into the exterior, seat-mounted backpacks, and a convertibletop.

Another one of Mitsubishi’s concept cars, the Space Liner, was designed to use the car’s interior space in new ways to provide the most comfortable ride possible. Envisioned as a car of the future, it gets its power from fuel cells.

Carmaker Suzuki also provided its share of innovative designs for this year’s show.