Welcome to English as a Second Language podcast number 276, The Stock Market.
This is English as a Second Language podcast, episode 276.
I'm your host, Dr Jeff McQuillan, coming to you from the Center for Educational Development in beautiful Los Angeles, California.
Remember to visit our website at eslpod.com. and download the learning guide for this episode.
The learning guide contains all of the vocabulary definitions, sample sentences, additional definitions not found on the podcast, cultural notes and a complete transcript of this episode.
The stock market, where people buy and sell stocks which are basically a small percentage of the company that you own.
We're going to listen to a conversation between Paul and Heather that uses some of the common vocabulary you would read about or hear about when talking about the stock market.
Let's get started.
Have you seen the paper?
The stock market went down a lot yesterday.
The NASDAQ is down 100 points, and the Dow is down 30.
My portfolio is in big trouble.
I knew you had some stock options in this company, but I didn't know you were so heavily invested in the market.
I'm sure you have a good stockbroker who has made sure that your portfolio is diversified and you have different kinds of securities.
That's my problem.
I don't have a stockbroker.
The drop in stock prices won't last.
I'm sure the market will rebound.
Just don't panic and sell everything.
The old saying, buy low, sell high, it's still a good idea, I think.
I know, I know.
I won't do anything stupid.
That is, I won't do anything even more stupid.
I'll wait to see what happens before taking any action.
That's a good idea.
Come on, I'll buy you lunch.
Thanks.
Now that I'm poor, I won't say no to your charity.
Our dialogue begins with Heather asking Paul, What's the matter?
Meaning, what's the problem?
She says, You look terrible.
This is what people say to me all the time.
Jeff, you look terrible.
You look bad.
Like you have a problem.
Paul says, haven't you seen the paper?
When you ask someone haven't you seen something or haven't you heard something?
You are expressing surprise with your question.
You're saying I'm surprised that you have not seen the paper and that you don't know some piece of information.
In this case, the piece of information that Paul is referring to is the stock market going down yesterday.
The stock market is sometimes called the stock exchange, E-X-C-H-A-N-G-E.
It's the place where you can buy and sell stocks.
Stocks are sometimes called shares, S-H-A-R-E-S.
It's the same as stocks here.
It's essentially having a small part of the company, owning a small percentage of the company.
Paul says that the NASDAQ is down 100 points and the Dow is down 30.
The NASDAQ, which is spelled NASDAQ In all capital letters.
NASDAQ stands for the National Association or Group of Securities Dealers.
Automated Quotations.
You don't need to know what all those words mean.
You just need to know that.
It is a popular stock market in the United States, one that has a lot of technical and computer stocks on it, for example,
It's called the NASDAQ.
The NASDAQ is one place where you can buy and sell stocks.
It's located in New York.
Of course, you don't have to be in New York.
You can use your computer or make a phone call to buy and sell stocks on the stock market.
The other big stock market is called the New York Stock Exchange.
And on the New York Stock Exchange you can tell if the stocks are generally going up or generally going down by looking at something called the Dow, which is capital D-O-W.
That's short for the Dow Jones Industrial Average.
Dow Jones is the name of a publishing company and they take the price of 30 very popular stocks and they tell you whether they're generally going up or generally going down.
It's what we call an index.
An index is an indication of something.
In this case, it's an indication of whether the stock market is going up or going down.
Notice Paul says that the NASDAQ is down 100 points and the Dow is down 30 points.
Both the NASDAQ and New York Stock Exchange use numerical or number indications of how good the stock market is or bad it is, and those numbers are called points.
Paul says, your portfolio, P-O-R-T-F-O-L-I-O, is another word for your investments.
You could be invested in stocks.
You could have other investments.
You could own land.
You could own different kinds of financial investments.
All of them together would be called your portfolio.
This word portfolio has a few other meanings in English as well.
Take a look at our learning guide for this episode for more explanations.
Heather says to Paul I knew that you had some stock options in this company, but I didn't know you were so heavily invested in the market.
Stock options are opportunities that the company you work for gives you to buy stocks in the future at a certain price.
This is one of the things that companies do, especially a lot of tech companies.
Technology companies will give to their employees.
And it is a way of making money through buying the company's stock.
So they're called stock options.
It's an option or an opportunity to buy the stock in the future at a certain price.
Usually, if the price of the option is lower than the actual price, you can make money this way.
Paul says, A couple of important terms here.
The first is the bond market.
We've talked about the stock market as a place where you buy and sell shares or stocks in a company.
The bond market is where you buy and sell bonds, which are promises that the government or another organization will pay back money it has borrowed with interest.
And what that means is, let's say the U.S. government wants to borrow a billion dollars.
Well, it would sell bonds, and people would buy these bonds.
They would get their billion dollars.
And then they would give the money back to people who bought the bonds in the future.
They would give them their money back.
Plus, they would give them some additional money what we would call interest.
And that's what the bond market is all about buying and selling these agreements from the government or from other companies to give you your money back, plus more money or interest.
Derivatives are a little more difficult to explain.
These are agreements between two people or businesses where the value or price of the agreement is based upon other stocks or bonds or other things that are worth money.
The word derivative means to come from something else.
So this is a special kind of investment that is based on other investments.
Shares, we've already talked about, is just another name for stocks.
So when Paul says I have shares in a lot of companies, he means I own stock in a lot of different companies.
These shares took a nosedive.
A nosedive, N-O-S-E-D-I-V-E, one word, means a sudden decrease.
When something goes down very quickly and significantly, it goes down a lot.
That would be a nosedive.
You could say the amount of money our company made last month took a nosedive.
It went down a lot.
Heather says is a person who buys and sells stocks for other people.
When Heather says I'm sure you have a good stock broker, she means a person that Paul works with that will help him buy and sell his stocks.
Heather thinks that Paul's stock broker has made sure that his portfolio is is diversified.
When we say something is diversified d i v e r s i f i, e d we mean it is involving many different types of things, in this case many different kinds of stocks from different kinds of companies.
Some of the companies may be in technology.
Some of the companies may be in oil and energy.
To have a diversified portfolio is to have investments that are in different companies, different kinds of companies.
Heather also uses the word securities.
A security is just another name for a stock, a bond, or a derivative, a type of investment.
Paul says that he does not have a stockbroker, that he decided to invest on his own.
To invest as a verb means to give money to a company to buy their stock, or to give money to a company in hopes that you will make more money.
Paul says that he went for less secure stocks, meaning stocks that were more risky than stocks that could go up a lot but also go down a lot.
He did this hoping for a better return.
A return, sometimes called a return on investment, is the money you hope to get back, the money you get back from your investment.
So if you invest $10,000 and you get back $12,000, the return on your investment was 20%, $2,000.
Paul says that he thought he could tell the difference between a bear and a bull market.
The words bear B-E-A-R and bull B-U-L-L indicate different types of animals, but we use them in talking about the stock market to describe whether the market is going up or the market is going down, if prices are going up or stock prices are going down.
A bear market is when the stock market is going down.
A bull market is when the stock market is going up.
I'm not sure why we use the animals bear and bull to describe the stock market, but it is very common to see that in the newspaper in describing the stock market.
Heather says that she is sure the stock market will rebound.
To rebound here means to recover, to improve, to get better, to go back to where it was before.
She tells Paul not to panic.
P-A-N-I-C.
To panic is to do something without thinking about it carefully, usually because you are scared.
Paul says that he will not panic, and Heather invites Paul to lunch.
Paul says, thanks, now that I'm poor, I won't say no to your charity.
Charity, C-H-A-R-I-T-Y, is when someone helps someone else.
Someone gives you money, for example.
We usually use this word in talking about helping poor people or people who need money.
Now let's listen to the dialogue, this time at a normal speed.
What's the matter?
You look terrible.
Haven't you seen the paper?
The stock market went down a lot yesterday.
The Nasdaq is down 100 points and the Dow is down 30.
My portfolio is in big trouble.
I knew you had some stock options in this company, but I didn't know you were so heavily invested in the market.
I'm invested in the bond market, in derivatives, and I have shares in a lot of companies that took a nosedive yesterday.
I'm sure you have a good stockbroker who has made sure that your portfolio is diversified and you have different kinds of securities.
That's my problem.
I don't have a stockbroker.
I decided to invest on my own and to go for less secure stocks hoping for a better return.
I thought I could tell the difference between a bear and a bull market as well as the brokers.
I guess I was wrong.
The drop in the stock prices won't last.
I'm sure the market will rebound.
Just don't panic and sell everything.
The old saying, buy low, sell high, is still a good idea.
I think.
I know, I know.
I won't do anything stupid.
That is, I won't do anything even more stupid.
I'll wait to see what happens before taking any action.
That's a good idea.
Come on, I'll buy you lunch.
Thanks.
Now that I'm poor, I won't say no to your charity.
The script for this dialogue was written by Dr. Lucy Say.
From Los Angeles, California, I'm Jeff McQuillan.
Thanks for listening.
We'll see you next time on ESL Podcast.
English as a Second Language podcast is written and produced by Dr Lucy Say, hosted by Dr Jeff McQuillan.
This podcast is copyright 2007.
