A. unable to provide for the needs of the population B.……
Large companies need a way to reach the savings of
the public at large. The same problem, on a smaller scale, faces practically
every company trying to develop new products and create new jobs. There can be
little hope of raising the money needed from friends and people we know, and
while banks may agree to provide short-term finance, they are generally
unwilling to provide money, for long-term projects. So companies turn to the
public’ inviting people to lend them money, or take a share in the business in
exchange for a share in future interests. This they do by issuing stocks and
shares in the business through the Stock Exchange. By doing so they can put into
circulation the savings of single persons and institutions, both at home
and abroad.
When the saver needs his money back, he does not
have to go to the company with whom he originally placed it. Instead he sells
his shares through a stockbroker to some other Saver who is seeking to
invest his money.
Many of the services needed both by
industry and by each of us are provided by the government or by local
organizations. Without hospitals, roads, electricity, telephones and railways,
this country could not work. All these require continuous spending on new
equipment and new development if they are to serve us properly, requiring more
money than’ it is raised through taxes alone. The government, local
organizations and nationalized industries therefore frequently need to borrow
money to finance: major capital spending, and they, too, come to the Stock
Exchange.
There is hardly a man or woman in this country whose
standard of living does not depend on the ability of his or her employers to
raise money to finance new development. In one way or another his new money must
come from the savings of the country; The Stock Exchange exists to provide a
channel through which these savings, can reach those who need finance.All the basic services on which we depend are ______.
A. unable to provide for the needs of the population
B. financed wholly by rates and taxes
C. in constant need of financial support
D. run by the government or local organizations
