Passage Seventeen (A Strong Stock Market)

The increase in the margin rate from 50% to 70% was not an attempt to stem any rampant speculation on the part of the public—actually the market seemed technically quite strong, with public participation essentially dignified—but rather an attempt by the Federal Reserve Board to preserve the sound underpinnings that existed in the market．Naturally, such a move had a momentarily chilling effect upon prices but if the FRB had been preoccupied with undue speculation, the increase might have been to the 80% or even 90% level．Such an increases in the margin rate is a confirmation of a strong stock market and since 19…,such increases have resulted in interim market highs over twelve months later．Obviously, there could be no guarantee that this would once again be the case, but if history is any guideline—and if business and corporate earnings were to continue on the same course—continued optimism over the outlook for the stock market would seem more prudent than pessimism.

The margin increase underscored the good rise that stocks had enjoyed for the previous year—and the fact that a 50% rate was maintained as long as it was pointed up the fact that the rise was mainly conservative in that it was concentrated in the blue chips for the most part．In past Investment Letters we have voiced the thought that speciality stocks could outperform the general market from this point．We continue to believe that this could be the case．For example, steel stocks tend to sell at certain fixed price/earnings ratios．Below a certain ratio they are considered good value—above a certain ratio, overpriced．If a company produces a unique product it is far more difficult for market analysis to place a numerical ratio upon the company’s earnings．We have also contended in the past Letters that the stock market reflects mass psychology as well as the business outlook．When investors—both the public and the institutions—are nervous and pessimistic they definitely hesitate to buy stocks: they seek low price/earnings multiples and high yields．These same investors—when they are in an optimistic frame of mind—become for less preoccupied with yields and more wiling to pay a premium(high p/e multiples) for accelerated growth．If the public’s attitude towards the auto industry is any measure, then this period seems to have been one of optimism.

　　1．The title that best expresses the ideas of this passage is  ___________

　　[A]A Time to Sell Stock． 

　　[B]A Strong Stock Market

　　[C]Raising the Margin Rate 

　　[C]Price/earnings Ratio in Steel

　　2．When investors are pessimistic what do they do?

　　[A]They look to the FRB for help．

　　[B]They buy steel

　　[C]They buy automobile stocks．

　　[D]They look for high yields.

　　3．Why does the writer believe that speciality stocks could outperform the general market?

　　[A]Because analysis have difficulty in deciding upon a fixed price/earnings ratio.

　　[B]Because the activity had been limited to blue chips.

　　[C]Because the rise was conservative.

　　[D]Because of the FRB action.

　　4．When investors are optimistic, what do they do?

　　[A]They look for accelerated growth．

　　[B]They buy speciality stocks.

　　[C]They look for high yields．

　　[C]They are more prudent.

Vocabulary

　　1． margin rate 保证金率，边际比率

　　2． rampant无约束力，猖獗的，蔓延的

　　3． stem遏制

　　4． stem from滋长，源自

　　5． underpin 加强……基础，支持

　　6． underpinning支持物，基础（建筑物下的）

　　7． preoccupy先占，使专心于，吸引住

　　8． undue 过分的，非法的，不适当的

　　9． interim间歇；暂时的，间歇的

　　10．guideline方针，指导路线

　　11．underscore 在……下面划线，强调

　　12．point up 加强，强调

　　13．bluechip 兰筹股票

　　14．blue-chip兰筹的

　　15．outperform在使用上胜过

　　16．overprice将……标价过高

　　17．numerical ratio 数率，数字比率

　　18．earnings收益，利润，收入

　　19．contend 竞争，坚决主张，争论

　　20．premium佣金，酬金

　　难句译注

　　1．The increase in the margin rate from 50% to 70% was not an attempt to stem any rampant speculation on the part of the public—actually the market seemed technically quite strong, with public participation essentially dignified—but rather an attempt by the Federal Reserve Board to preserve the sound underpinnings that existed in the market.

　　[结构简析] 是not…but句型，两个破折号中间是插入成分；中插入一个带with+N+participle 短语

　　[参考译文] 保证金率从50%增长到70%，并不是想要遏制群众方面猖獗的投机，而是联邦储备委员会想要保持现存于股市强劲基础——事实上股市由于群众非常庄严的参与——在技术上看起来相当强劲。

　　2．Obviously, there could be no guarantee that this would once again be the case, but if history is any guideline—and if business and corporate earnings were to continue on the same course—continued optimism over the outlook for the stock market would seem more prudent than pessimism.

　　[结构简析] 复合句。中间有插入语if clause, 进一步说明条件。

　　[参考译文] 显然，不可能保证这种情况再次出现（情况再是这样）。可是，如果历史具有指导方针的话——如果商业和公司的利润仍然保持在同样轨道上——那么对股市前景乐观似乎要比悲观更精确些。

　　3．The margin increase underscored the good rise that stocks had enjoyed for the previous year—and the fact that a 50% rate was maintained as long as it was pointed up the fact that the rise was mainly conservative in that it was concentrated in the blue chips for the most part.

　　[结构简析] 这句句子内有四个that clause：第一个that是good rise的定语从句。第二个和第三个that都是the fact that句型。但第二个the fact that中，as long as it was, 指头一年，pointed up是谓语。第四个是in that连词，义：因为。

　　写作方法与文章大意

　　文章论述“强劲证券市场”的种种情况。首先是联邦储备委员会为保持强股市基础要求保证金率增长。这种增长过去，现在，将来都能巩固强市。其次由于绝大部分集中在兰筹股上，使股市看好上升趋于保守，引出行业股比普通股吃香。最后是投资者心情和股市强弱有关。

答案祥解

　　1．B．强劲证券市场（强市）。见难句译注1和第一段第三句：“那种保证金率的增长有力的巩固了强劲证券市场。从19……年起，这种增长导致一年来股市屡创新高。

　　A．买出股票的时候。 C．提高保证金率。D．钢的市盈率。这三项都不对，它们只是文中涉及的方面。

　　2．D．他寻找高业绩（即公司的产量或投资收益）。见文章倒数第三句：“当投资者——公众和团体机构——紧张而又悲观时，他们肯定在买进股票上举棋不定；他们寻求低价格/利润倍数和高额利润。

　　A．他们寻求联邦储备委员会的帮助。B．他们买进钢材。 C．他们买进汽车股票。

　　3．A．因为在决定定价/利润比上难以分析。见第二段第二句：“在过去的投资保证上我们一直表达了这样的思想：行业股票在使用上可能超过普通股。我们依然相信情况可能就是这样。举例说：钢股往往在一定价格/利润比上抛出。低于一定比率，可认为股是好价值，而高于一定比率就是超价。如果一个公司就生产独一无二的产品，那市场分析就很难对公司所得定出数比。“

　　B．因为股市活动受兰筹股所限。C．因为行情上升保守。这两项见难句译注3。 

　　D．由于联邦储备基金会的行动。

　　4．A．他们寻求加速的增长。见文章倒数第二句：“同样是这些股民，当投资者（对股市前景）持乐观态度时，他们不太关注（公司的）业绩（产值）而愿意以高价来购买具有高成长性的股票。”