Lesson 27: Unit 53 BANKS AND MONEY

Lesson 27: Unit 53 BANKS AND MONEY

David: Today we talk about banks and money.

Kevin: And we meet this man. Chris Bailey who works at the bank of Bank of England.

Natalie: Banks and money. What do you use your bank for?

1.    I used the bank for paying in my salary each month.

2.    I use it to cash my checks basically that’s really all I use it for.

3.    I never go into a bank. I simply use it as a method of storing my money and drawing it out.

4.    I use a bank for my checking in my savings accounts.

5.    I personally would be very happy if I never had to walk into a bank again in my life. I’d much rather keep my money in a tin trunk and leave my bed.

Kevin: I’ve just opened an account at my local bank here in London. I’m waiting for a checkbook instead I got a letter from the bank this morning. Dear Mr. Dutcher. Thank you for opening an account with us. Unfortunately your checkbook might be delayed. Wonderful.

Your checkbook might be delayed.

Teller: Can I help you?

Tramp: Yes. I’d like a million pounds to be transferred from my current account to my deposit account.

Teller: I’m sorry. I’m very busy.

Tramp: Are you going to transfer the money?

Teller: Of course not. You haven’t got a million pound!

Tramp: In that case, I’d like to close my account.

Teller: Fine. No problem. Goodbye! Did you hear that? He wanted me to transfer a million pounds to his deposit account!

Second teller: Yes. That’s Mr Higgins. He’s the bank’s biggest customer.

Teller: Oh, no. Mr Higgins! Come back!

Natalie: He was richer than he looked. That customer had two bank accounts.

Current account = Cheques.	I’d like a million pounds to be transferred.
Deposit account = Interest.	I’d like a cheque-book to be sent…

Kevin: I told the bank that I wanted a cheque book to be sent to me immediately. But the letter says it might be delayed. I wonder why.

David: Well, your references have to be chequed.

Kevin: Do they? Oh…

Natalie: Perhaps it’s just a problem with the machine that prints the cheque books.

Kevin: What sort of problem?

Natalie: Well… er… the machine might be broken.

Kevin: Do you think so?

Natalie: Yes, that must be the reason.

Your references have to be checked.

The machine might be broken.

Chris Bailey at the Bank of England: The Bank of England is Britain’s central bank. Every country has a central bank. We are the government’s bank and we are the issuers of the money, of the notes that circulate in Britain. Some countries have independent central banks where, by constitution or by law, the central bank is set up separately from the government. But in this country the Bank of England is owned by the government. They own all our shares; we are a part of the government team. So we give advice to the Treasury, and to our Chancellor of the Exchequer, and to the Prime Minister on monetary policy: what would be an appropriate policy, how fast to let the money supply grow. Once the elected politicians, once our democratic government have reached policy decisions, based on our advice, we then carry out those policies.

The printing of bank notes is a very complex function. We have to be sure that our notes are as secure against counterfeiting and forgery as they possibly can be, so we want to use the latest printing techniques that are available. We re-issue the currency notes about every ten to 15 years in Britain. If we didn’t do that, there’s a risk that notes could easily be forged because printing technologies change.

We need to be ahead of the counterfeiters. For example, one of the problems which all central banks face these days is that of the colour copier machine. Notes might be forged on a colour copier simply by putting them into the machine and people having a go. We keep ahead of that, partly because of the very complex paper we use which is not at all like copier machine paper, and partly by the intense patterns and colour combinations in the bank notes which make it very difficult for a copying machine to reproduce them accurately. We have to be ahead of the technology, which means we re-design the product every ten or 15 years.

The use of the public make of  paper money is rather less today than it was a 20 or 30 years ago typically a man or woman working in a factory today will have their salary paid to them by check. Whereas 20 years ago probably somebody came out and gave them an envelope with bank notes inside it that has changed people now when they go shopping don’t  pay large amounts of cash across the counter they use a credit card or perhaps they use a check. So people can economize on banknotes we print as many banknotes as the public want to use but the relationship between the amount of banknotes we need to print and the amount of money the public can spend has changed.

Notes could be forged.

Notes might be forged on a colour copier.

The services that the bank provides to its staff customers are the same as those provided by a commercial bank. Cash can be drawn out across a counter. Cash could be drawn out through the automatic teller machines which commercial banks, of course, had on the outside of their buildings, foreign exchange can be bought either foreign exchange notes or traveler’s checks. Bills can be paid through banks. It’s possible to have your utility bill paid electricity or gas or telecommunications bills. These can be paid through banks. Taxes can be paid to food banks. The Bank of England provides all these services to its staff just as commercial banks provide them to men and women in general in Britain.

Cashier: Good morning.

Client: Good morning. Can I change these dollars into pounds, please?

Cashier: Certainly. 20, 40, 50. The exchange rate is 1.6.

Client: All right.

Cashier: That’s 31 pounds 35.

Client: That’s fine.

Cashier: There’s a 2 pound commission charge for that. How would you like your money?

Client: In fives, please.

Cashier: Certainly. Five, ten, 15, 20, 25… That’s 29.25.

Client: Thank you. I also have this international money order can I pay it into my current account?

Cashier: Yeah, It’s instead of nine dollars.

Client: It’s in sterling.

Cashier: Can take you 20 10 cashiers.

Client: Thank you.

There’s been a revolution in commercial banking in person over the last 20 years data revolution in commercial banking in many parts of the world, of course, one thing that has changed in commercial banking is the technology. In addition to those technological changes. There’s much more competition in banking these days. Nowadays if you go to a bank and you have a checking account the bank will probably pay you interest on that checking account, because it wants your savings. Twenty years ago that would probably not have been the case. So it’s a much more competitive and user-friendly banking system today.

Cash can be drawn out.	Foreign exchange can be bought.
Bills can be paid.	Taxes can be paid.
Can I change these dollars into pounds, please.	The exchange rate is 1.6.
There’s a 2 commission charge for that.	How would you like your money?
In fives, please.