Advanced - Investing in Emerging Markets (E0029)
A: Dad, I’d like to borrow some money.
B: Sure, Johnny, how much do you need? five
bucks?
A: Come on, Dad, I need thirty thousand. I wanna
get into the market. You know, I’m tired of hearing
all this news about the economic downturn, the
inevitable recession, people stuffing their money
in their mattresses. I look at this as an opportunity.
This is a chance for me to get a jump start on
building my nest egg.
B: I don’t know about that; with all the uncertainty in
the markets right now, it would be a very unwise
decision to invest. I don’t know if you’re aware
son, but there has been a lot of turmoil in the mar-
kets recently. There have already been half a mil-
lion layoffs in the last few months, and we have
no idea how the proposed stimulus package will
impact the economy. There’s just too much insta-
bility. I wouldn’t feel comfortable investing in this
climate.
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A: But look at it this way, every challenge is an oppor-
tunity. And anyway, I’m not talking about investing
in the domestic market. There are emerging mar-
kets that promise great returns. Look at China, for
example; they have 1.4 billion people, half a billion
of whom have recently entered the middle class.
Here alone, the aggregate demand for consumer
goods represents an amazing wealth generating
opportunity.
B: Come on, son, you’re looking at this too naively,
the Chinese market has exhibited a great deal of
instability, and their currency has been devalued
by almost a whole percentage point.
A: Fine, then! If that’s the way you feel, so be it. But
you’re losing out on a great opportunity here. I’m
going to go hit up Mum for the cash.
Key Vocabulary
inevitable Adjective unavoidable
Visit the Online Review and Discussion (text version). c ?2008 Praxis Language Ltd.
nest egg Noun (sin-
gular)
money that is saved to
pay for something in
the future, usually a
house, or retirement
turmoil Noun (non-
count)
a state of confusion,
disorder, disturbance
stimulus package Phrase amount of money the
government uses to im-
prove the economy
Noun (non-
count)
state of not being sta-
ble, being likely to
change
emerging market Noun (plu-
ral)
nations undergoing
quick industrialization
Adjective combined
devalue Verb reduced in value
hit up Verb ask for money
Supplementary Vocabulary
depreciation Noun (non-
count)
an decrease in the value
of something
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appreciation Noun (non-
count)
an increase in the value
of something
inflation Noun (non-
count)
an continual increase in
price
developing econ-
omy
Noun (plu-
ral)
growing economy
rapidly developing
country
Noun (plu-
ral)
countries undergoing
quick industrialization
industrialized na-
tion
Noun (plu-
ral)
nations that have devel-
oped factories and busi-
nesses
Visit the Online Review and Discussion (text version). c ?2008 Praxis Language Ltd.
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