Topic 7

Word

Definition

Example

boom-bust cycle

a process of economic expansion and contraction that occurs repeatedly

Its banks avoided the boom-bust cycle of the past decade, having learned from the banking collapse in 2000-2001.

stock-market collapse

a sudden dramatic decline of stock prices across a significant cross-section of a stock market, resulting in a significant loss of paper wealth

In the early nineties there was the great stock-market collapse and the peso devaluation.

bond

an amount of money borrowed by a government or an organization. The government or organization producesa document promising that it will pay back the money that it has borrowed, usually with interest.

Many investors switched out of shares into bonds yesterday.

default

to fail to pay money that you owe at the right time

He defaulted on his child support payments.

booming

having a period of great prosperity or rapid economic growth

Business was booming, and money wasn't a problem

boom

a time when business activity increases rapidly, so that the demand for goods increases, prices and wages go up, and unemployment falls

After four years of economic boom, this year saw a slowing down of the economy.

slump

a period when there is a reduction in business and many people lose their jobs

The war was followed by an economic slump.

bubble

a temporary period of very successful economic performance in a particular country or sector, often followed by sudden failure

He made millions before the dotcom bubble burst.

bull market

a market in which share prices are rising, encouraging buying.

In a bull market, mutual fund managers can find many ways to win

bear market

a market in which share prices are falling, encouraging selling

These people know that trading can be profitable both in bull and bear markets.

share

one of the parts into which ownership of a company is divided

Friendly companies and banks hold 56% of all shares in Germany's listed companies.

bonus shares

one of the shares given to existing shareholders when profits are distributed. Bonus shares are sometimes given in addition to the normal

In addition to its regular dividend, Heineken said it will propose issuing a bonus share for each four shares investors hold.

ordinary share

the most frequent type of share in most companies. If the company is in financial difficulty, dividends on commonshares are paid only after those made on other particular types of share, such as prefe

Company management is freezing the dividend at last year's level of FFr8.6 for ordinary shares and FFr9.4 for preferred shares.

preference share

one of a class of shares on which, if a company is in financial difficulty, dividends may still be paid even if they are not paid on ordinary shares. Dividends on preference shares are usually paid in

Preference shares will usually rank ahead of ordinary shares for dividends and a return of capital.

shareholder

an owner of shares in a company.

Dividends will be sent to shareholders on March 31

share price

price of a single share

Lloyds' share price increased by 3% overnight

stock

one of the shares into which ownership of a company is divided, or these shares considered together

The company might issue stock in order to pay down debt.

quoted company

a company whose shares are traded on a stock exchange

The world's quoted companies are expected to post 23% profits growth this year

invest

to buy shares, bonds, property etc in order to make a profit

People are so pessimistic about the future that they won't invest at the moment.

investment

the action or process of investing money for profit

Each of us put in $5,000 as an investment.

dividend

a sum of money paid regularly (typically annually) by a company to its shareholders out of its profits (or reserves).

As director and principal shareholder, he receives a substantial annual dividend from the company.

yield

A product; the quantity of something produced.

The supposed difference in yield is 3.5 basis points.

stock exchange

a market where company shares are traded

Companies listed on the Madrid stock exchange dropped about 3 per cent this year.

stock market

a stock exchange

The Kuwait stock market closed up three points.

go public

to become a public company

Many partnerships went public in the 1980s to secure extra capital.

steam ahead

to start doing something very quickly

The company is steaming ahead with its investment programme.

sparkling

energetic and interesting

His writing is known for its sparkling dialogue.

sink

to gradually get into a worse condition

They lost all their money and sank into desperate poverty.

spike

a sudden large increase in the number or rate of something

In the last six months, there has been a spike in unemployment.

soar

To rise, fly, or glide high and with little apparent effort.

And his stance on the exorbitant profits of oil companies while record high gas prices continue to soar is just plain sorry.

downturn

a decline in economic, business, or other activity

There is evidence of a downturn in the housing market

upturn

an increase in the level of something, especially in business activity

There seems to be no sign of an upturn in business.

rally

if prices of shares, currencies etc rally, they rise again after falling

Stock prices rallied this afternoon after earlier falls.

recover

return to a normal state of health, mind, or strength

After a few days of fever, she began to recover.

regain ground

to start to be more successful again after a difficult period of time

The dollar regained some of its lost ground today.

turn around

to make a business that is having difficulties successful again

New models and new ideas have turned the company around and saved the factory from closure.

bankrupt

without enough money to pay what you owe

The firm went bankrupt before the building work was completed.

bankruptcy

the state of being unable to repay debts

Many more bankruptcies and restructurings are on the horizon

go out of business

if a company goes out of business, or something puts it out of business, it stops operating, especially because of financial problems

Firms that fail to take advantage of the new technology will go out of business.

liquidation

Disposal of, killing

The vendor was a company in liquidation called Pacific Heights Developments

ailing

in financial difficulty

This may be the best cure for China's ailing industries.

fold

if an organization folds, it closes because it does not have enough money to continue

2500 small businesses were folding each week.

go bust

a business that goes bust cannot continue operating

I think I fancy a well-paid job with a firm that won't go bust.

troubleshooting

analysing and solving serious problems for a company or other organization

A little troubleshooting is needed.

management consultant

a person or company that gives professional advice about how to run a company

The board decided to hire management consultants to improve corporate processes.

insolvent

a person or company that is insolvent does not have enough money or assets to pay their debts

The company has now been declared insolvent.

profit margin

the difference between the cost of producing something and the price at which you sell it

Many small companies operate on very narrow profit margins.

gross margin

the difference between the price that a product or service is sold for and the cost of producing it, without including overheads

The company needed a gross margin of around 40% to make a reasonable profit.

mark-up

Average mark-up in software enterprises has been measured to 19%.

Average mark-up in software enterprises has been measured to 19%.

profit

the amount added to the cost price of goods to cover overheads and profit.

Coca-Cola reported strong profits last year.

gross

(especially of wrongdoing) very obvious and unacceptable

His gross annual income is over half a million pounds

net

something used for catching fish, insects, or animals which is made of threads or wireswoven across each other with regular spaces between them

Can you pass the fishing net?

break even

reach a point in a business venture when the profits are equal to the costs

We're hoping that we'll at least break even, and perhaps make a small profit.

break-even point

the level of sales at which the income from goods sold is just enough to cover the costs of production so that neither a profit nor a loss is being made

The service's break-even point is around 3,500 subscribers.

ROCE

measure of the profit that a company makes and represents the efficiency with which the capital invested in a business is used to generate revenue

The ROCE formula is a very popular financial analysis.

capital employed

the total amount of share capital and debt that a company has and uses

The oil company is faced with doubling the capital employed in its refining and marketing business to £6 billion in the next 10 years.

return

the amount of profit made from an investment

British government bonds have produced a total return of 8.52% so far this month.a slump affecting the returns from investment