I. Learn the following words

Recession – падение, спад;

forecast – прогноз;

to shrink – сокращаться;

output – производительность, продукция;

trend – тенденция;

to squeeze – снижаться;

to bounce – повышать, увольнять;

to overhang – выступать над …;

to crumble – разрушаться, распадаться;

to spur – побуждать, заставлять;

to shorten – сокращать;

severe – глубокий, жестокий, тяжелый.

II. Answer the following questions.

1. What is the most popular question all Americans are asking nowadays?
2. What is the main driver of the downturn?
3. What are the factors determining if the economy can bounce back swiftly?

4. Why is the most useful economic indicator to watch is consumer confidence?

1. What can really cause consumer confidence to crumble?

6. What allows most economists and investors to believe that a recession can be prevented ?

1. What possible ways to ward off a recession are described in the text?

III. Complete the sentences with suitable words from the box.

official forecast; to squeeze profits; to bounce back ; to spur spending; recession; deep recession; mild recession; inventory correction;a serious overhang of capital investment;consumer confidence

1. A great number of leading economists in America have admitted to The Economist that they are more worried about a … than their … might suggest.

2. But it is hard to forecast …, let alone … , when your firm sells equities.

3. As … have been … and weaker sales have caused inventories keen to pile up, firms have started to trim their investment and production.

4. That would make it the … in history.

5. The usual … should take place more rapidly than usual, allowing the economy … more swiftly.

6. John Makin, an economist at the American Enterprise Institute, believes there is … .

7. The most useful economic indicator to watch is … .

8. Monetary policy always operates with long lags, but with record levels of debt and excess capacity, lower interest rates may be even less effective than usual in … new … .

IV. Fill in the blanks with articles if needed.

The trend is gloomy. … main driver of … downturn has been the business sector. As … profits have been squeezed and weaker sales have caused inventories keen to pile up, … firms have started to trim their investment and production. Firms have already started to slim their excess stocks. … usual inventory correction should take place more rapidly than usual, allowing … economy to bounce back more swiftly.

The behaviour of … consumer and corporate spending will determine whether this happens without … recession. John Makin, an economist at … American Enterprise Institute, believes there is … serious overhang of capital investment.

V. Fill in the blanks with suitable prepositions.

The most useful economic indicator to watch is consumer confidence. Mr. Greenspan has likened the sudden break … confidence before past recessions to "water backing up … a dam that is finally breached." It is difficult … monetary policy to deal … such a sharp break … confidence. If nervous consumers suddenly decide to save more and spend less, a serious recession could follow.

What would really cause consumer confidence to crumble is big job lay-offs. So far unemployment has increased.

Most economists and investors still have faith to prevent a recession through interest-rate cuts. Monetary policy always operates … long lags, but …record levels … debt and excess capacity, lower interest rates may be even less effective than usual … spurring new spending.

VI. Give Russian equivalents for the following words and phrases used in the text:

shrinking output;to trim investment and production;to slim excess stock;consumer spending;corporate spending;a sudden break in consumer confidence;job lay-offs;to prevent a recession through interest-rates cuts;producer-price inflation;to shorten recession.