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Say
"the streets of New York" to a non-American, and he'll probably think
of Times Square, Madison Avenue or Broadway; but mention the subject to
an American and for many the first name that comes to mind will
be Wall
Street.
For many, Wall Street is indeed just
"the street", probably the most important street in the USA or even in
the world; for what goes on on Wall Street, more perhaps than what goes
on in Congress, can have a direct influence on the lives of everyone in
the USA, if not most people in the world.
Wall Street is of course the home of the
New York Stock Exchange, the financial heart of the American business
world. Each day, billions of dollars of shares are traded on the floor
of the stock exchange on
behalf of companies, pension funds and private
individuals wanting to protect their investments or their life's
savings, and make sure that they too are on the bandwaggon of
prosperity.
The New York Stock Exchange is the
biggest and most active stock exchange in the world; over half of all
adult Americans have some, if not all, of their savings invested
directly on Wall Street, so it is not surprising that the fluctuations
of the Street's famous indexes, the Dow Jones and the Nasdaq, are
followed daily by millions of ordinary Americans. When the Dow and the
Nasdaq are on a rise, millions of Americans feel more prosperous; when
they are falling, millions start feeling worried about their financial
security and their retirement
years. Yet more importantly, when Wall
Street booms it is a sign that the American economy is booming,
creating jobs and prosperity for people throughout the nation; when
Wall Street slumps for more than a short period, it is because the
American economy is slowing down, putting investment and jobs at risk.
Nevertheless, in spite of its periodic
crashes and downturns, most Americans know very well that by investing
directly in the stock market, they are probably ensuring the best
possible long term return on their investments.
Over time, direct investments on Wall
Street have always done better than most other forms of long-term
placement, and logically speaking this is inevitable. Ultimately, most
forms of investment depend on the performance of the US economy in
general, and by investing directly on Wall Street, American investors
are simply ensuring that they personally take full advantage of the
growth of the stock market, rather than share their gains with banks,
investment trusts or other intermediaries offering investment services.
The risk of a crash on Wall Street is a
reality that must always be borne
in mind: Wall Street "crashed" most
spectacularly in the fall of 1929, when share values dropped over 50%
in the space of a few days. By the time the fall bottomed out in
1932,
over 80% had been "wiped off" the value of shares on the American stock
market, and the Great Depression had begun.
Before 1929, as the stock market boomed,
over a million Americans had been speculating on the Street, borrowing
money that they did not have in order to buy shares for sale at a
profit. When the crash came, hundreds of thousands of these
speculators, both individuals and companies, went bankrupt, causing
immense distress and poverty.
More recently, Wall Street crashed in
2007 - 2008, almost triggering
a collapse of the world
financial system. When the stock market eventually stopped falling in
March 2009, it had lost 54% of its value, and many people had lost
their life's savings.
Previously in 1997, almost over a third
of its value was wiped out in a few
days; but this time the consequences were less dramatic. While most
Americans saw the value of their savings tumble, few went bankrupt as a
result.
In
today's America, borrowing money solely
for the purpose
of
speculating on Wall Street is not a common habit, so the money that was
"lost" in recent crashes was mostly money that people owned
themselves, not money that they owed to someone else.
One day no doubt, in some unforeseen
future, Wall Street will crash spectacularly again; but when that
happens there will have to be both a cause and an effect. The most
likely cause
will be a major world crisis; the most likely effect,
given today's "global economy", will be a major economic catastrophe
around the world, perhaps similar to the hyperinflation that affected
Germany under the Weimar republic.
If that happens, society as we know it
will grind to a halt,
and most forms of saving, except perhaps gold and
real estate,
will lose most of their value; until that day, Wall Street
will remain as one of the nerve centers of the global economy.
be
on the bandwagon: be part of -
bear in mind: remember
-
comes to mind: he
thinks of - distress:
alarm - fluctuation:
ups and downs - grind
to a halt: stop
- likely: probable
- on behalf
of: for
- plummet: fall
sharply - purpose: reason
- real estate: land
and buildings - retirement
years: years when one no longer works -
share: investment, bond - slump: go
downhill, fall - solely:
just -
stock:
share, investment - trade:
buy and sell - tumble:
fall
Student worksheet
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A
selection of other resources in graded English from Linguapress |
Selected pages |
Advanced level reading : |
Deserts of America |
Interview: the Birdman of the Isles |
Tea and the British |
Advanced level short stories: |
Blue Gum Tree |
Lucky Jim |
And lots more: More advanced reading texts |
Intermediate resources : |
The Beatles |
The Loch Ness monster; is it real? |
Sport: Sports, American style |
Life in the country; the good life? |
USA: Winter sports, USA |
USA: Close encounters with a Twister |
And more: More intermediate reading texts |
Selected grammar pages |
Online English grammar |
Nouns in English |
Word order in English |
Reported questions in English |
Miscellaneous |
Language and style |
Themed crosswords for EFL |
The short story of English |