KEY TO EXERCISES
Section A: Text Comprehension
I. Reference Answers to Pre-reading Questions:
1.The risks to the global financial system have moderated from the extreme levels identified in
the April 2009 Global Financial Stability Report (GFSR). However, overall financial conditions remain tight. Severe recession risks have eased in response to concerted fiscal and monetary policy stimulus measures. [Paras 1-3]
2.Because on both sides of the Atlantic, it is proving difficult to effectively implement measures
that fully address the problem of impaired assets on banks' balance sheets, leaving banks vulnerable to a further deterioration in the quality of these assets if the global downturn is deeper, and more prolonged, than projected. [Para 4]
3.Corporate bond markets have reopened，and are functioning more normally, but bank credit
growth is still slowing. [Para 5]
4.Because emerging markets are recovering, and emerging market assets have benefited from
the recovery of commodity prices and improved growth prospects, especially in Asia.
Emerging market equities have rebounded 30 to 60 percent since end-February, matching or outpacing mature market equities. [Para 8]
5.Because continued policy efforts are needed to stave off the chance that some of the recent
gains could yet be reversed. More work is needed to fix banks and markets. [Paras 11-12]
Section B: Exercises
I. Vocabulary Buildup
Choose the best equivalent word or phrase from the four choices marked A, B, C and D for each underlined word or phrase in the following sentences.
1. C
2. B
3. D
4. D
5. C
6. B
7. B
8. D
9. C 10. A
11. C 12. C 13. B 14. B 15. B
II. Translation Practice
Translate the following paragraphs into Chinese.
然而，总体金融状况依然不容乐观。在成熟经济体中，银行对私人部门信贷的增长继续放慢，未获得政府部门支持的证券化市场依然处于失灵状态，并且，资格较低的借款人几乎无法从资本市场获得融资。另外，为降低私人企业风险提供支持的政府部门干预已导致政府部门风险相应增加，并逐渐加重了财政负担。[Para.2] 鉴于对金融系统稳定造成的威胁在加剧，信贷紧缩在恶化，2009年4月《全球金融稳定报告》指出了迫在眉睫的政策挑战，强调采取一系列金融政策缓解下行风险。自此，政府实施的空前政策行为降低了金融行业发生重大倒闭的可能性，这是朝着人们对恢复金融市场信心迈出的重要一步。[Para.10]
在目前摆脱危机的关键阶段，政策制定者需维持迄今取得的进展。鉴于危机本身和为控制危机所采取的措施的空前规模，需要相应的政策回应。在整个过程中，时机和形式将是关键。尽可能依赖市场机制将能确保价格平稳、金融体制健全和国家
财政稳定，这与当前的目标是相一致的。[Para.16]
Ⅲ. Text Comprehension
Answer the following questions according to the text.
1.Unprecedented policy actions undertaken by central banks and governments worldwide have
succeeded in stabilizing the financial condition of banks, reducing funding pressures and counterparty risk concerns, and supporting aggregate demand. These interventions have reduced the tail risk of another systemic failure similar to the collapse of Lehman Brothers.
Bank debt and interbank markets have resumed functioning, albeit with massive public sector support. Concerns regarding liquidity and counterparty risks in the banking sector have declined. [Para 1]
2.Because overall financial conditions remain tight. Growth in bank credit to the private sector
continues to slow in mature economies, securitization markets outside those supported by the public sector remain impaired, and lower-quality borrowers have little access to capital market funding. Furthermore, the public sector interventions that have underpinned the reduction in private sector risks have resulted in a concomitant increase in public sector risks and a mounting burden on fiscal sustainability. [Para 2]
3.The evidences given by the report are the narrower spreads and lower projected default rates,
and the recovery of commodity prices and the resumption of portfolio inflows and rising asset prices. [Para 3]
4.April 2009 GFSR highlighted three main areas of risk: (i) that weaknesses in
advanced-economy banking sectors could act as a greater drag on credit growth and economic recovery; (ii) that emerging markets remain vulnerable to a slowing or cessation of capital inflows; and (iii) that yields on sovereign debt may rise significantly and private borrowers may be crowded out if the burden on public sector balance sheets is not managed in a credible way. [Para 4].
5.The better-than-expected earnings results, a successful stress-testing exercise, the
commitment by the U.S. government to stand behind the 19 largest banks, and a series of bank capital-raisings. [Para 5]
6.The evidence is that overall bank credit growth continues to diminish, as deleveraging
pressures persist. [Para 7]
7.This reflects in part improved recovery prospects and reduced risks of deflation. [Para 9]
8.Since then, the unprecedented policy actions have been taken and, as a result, have reduced
the likelihood of major failures, an important step toward restoring confidence. [Para 10]
9.Concerning banks, the needed work is in some cases to implement measures already taken,
and, in others, to adopt new measures. Concerning market, the needed work is to find ways to reopen the securitization market by placing it on a sounder footing. [Para 12]
10.Stress tests, which, if accompanied by credible measures to address any shortfalls in capital,
can be an effective tool in rebuilding bank balance sheet strength. The U.S. experience and recent European initiatives to organize coordinated stress tests are a welcome step forward.
[Para 14]
IV. Interactive Brainstorming (Omitted)
Discuss with your partners the following questions based on your understanding of the text as well as your own knowledge and ideas.
