ECONOMIC VOCABULARY: Words & Phrases You Should Know

The number one requested topic for vocabulary  that I receive is economic vocabulary.

You need to understand terms like inflation,  recession, GDP, tariffs for your daily life  

when you're discussing current events  and and for your language exam today.

You'll learn everything you need to know  in this economic vocabulary master class.

Welcome back to JForrest English.

Of course, I'm Jennifer.

Now let's get started.

This master class is divided into 5 sections,  Core economic concepts, Market and Trade Terms,  

Business and investment, Employment  and Wages, and Policies and government.

First, let's review core economic  concepts, Supply and demand.

This is a noun.

They're commonly used together,  but they can be used separately.

Supply and demand is the balance between product  availability, supply and consumer desire.

Demand, which effects price.

And that's why it's important, because  supply and demand often determines price.

You see this with housing  prices, with real estate.

Housing prices are soaring because demand is high.

People want houses, but supply is low.

There aren't available houses.

So this year we've seen soaring  prices and a sharp increase in sales.

Now notice the verb I used soaring.

The verb to soar means to  rise quickly and dramatically.

The verb is often used in economic news.

Using this verb, you can say my  English confidence is soaring.

And that's hopefully what you're thinking  and what these lessons help you do.

So if you're thinking not put, that's right,  that's right, put that's right in the comments.

And don't worry about taking notes because  I summarize everything in a free lesson PDF.

You can find the link in the description.

Let's talk about inflation.

This is a noun and it means rising  prices that reduce the value of money.

So if you have $100 under your  bed in three years from now,  

that $100 could be worth less  because overall prices are higher.

So that $100 will buy you less things.

That's because of inflation, Congress.

Should be focused.

On keeping inflation.

In check.

Generally people say in day-to-day  conversations everything costs more now.

Inflation has made groceries  and rent much pricier.

Notice to be pricey.

But in my example, I used the comparative pricier.

So to be pricey, this simply means expensive.

So much pricier means more expensive.

Now let's talk about deflation.

We have inflation and deflation.

This is also a noun.

It means falling prices, often due to weak demand.

Now deflation, falling prices.

It might sound good in theory, but it  usually means businesses are struggling.

So it isn't a good concept  for the overall economy.

Now recession.

You hear this everyday in the news  and people discuss this concept.

This is a period of economic  decline with job losses and  

slower growth growth in the overall economy.

You can say hiring freezes and layoffs  suggest we might be heading into a recession.

So notice that phrasal verb to  head into this means to go into,  

so it means entering A recession.

Now a hiring freeze.

This is a temporary stop on hiring new employees.

Layoffs.

This represents job loss due to company cutbacks.

Let's talk about the concept of boom and bust.

They are also commonly used  together, but it's not required.

A boom is rapid economic growth.

A bust is a sudden downturn,  so it's sudden decline.

Tech companies thrived, performed very well,  

thrived during the boom, the  period of economic growth.

But now many are going under in the bust.

So to go under this means to fail to permanently  close Section 2 market and trade terms.

Let's talk about a free market.

This is an economy where prices and businesses  operate with little government control.

In a free market, competition keeps prices  fair, but it can also lead to monopolies.

A monopoly this is when one  company dominates a market  

with no competition and this is not  good for overall economic growth is a.

Plethora of choice necessary in a free market.

I believe it is both a good and bad thing.

Now, tariffs, you hear this  a lot in the news right now.

This is a noun, and tariffs are taxes.

They're taxes on imported goods,  often to protect local businesses.

Now, I said you hear this a  lot in the news right now.

At the time of this recording, Donald Trump is  threatening to impose tariffs on many countries,  

including my country, Canada and Mexico.

Now, notice I used to impose a tariff.

This is to officially force a rural  tax like a tariff or a punishment.

Now I also used the word imports.

So let's talk about imports and exports.

Of course, imports are goods  brought into a country and  

exports are goods sold abroad exiting the country.

Electronics are the country's main import,  

so that's the noun form, and  sugar is its primary export.

Notice I use main and primary.

They're interchangeable and commonly  used with import and export.

Now you can also use the verb form and  you can say the US imports a lot of oil.

So notice it has that S because it's the  present simple conjugated with the subject,  

the US third person singular.

the US imports a lot of oil while it  exports agricultural products like corn.

So oil is entering the country,  corn is exiting the country.

Let's talk about trade deficit and trade surplus.

So a trade deficit happens when a  country imports more than it exports.

And then a trade surplus, well, it's the opposite.

It's when a country exports more than it imports.

So the country's trade deficit is growing because  it buys more from other nations than it sells.

We're both strong supporters of free trade  and today we've discussed how to take  

forward consultations to ensure that the UK and US  have the strongest possible trading relationship.

Let's talk about a bubble.

This is a noun.

So a bubble is when asset prices  rise far above their true value.

The real estate bubble burst in the US in 2008.

Did you read about that?

Now notice I used burst in my sentence.

It is a verb, but it can also be used as a noun.

And to burst or all burst is the sudden  collapse of those inflated prices.

So inflated means they're  bigger than they should be,  

and then burst is when they go  back down to a smaller size.

Section 3 Business and investment.

Let's talk about a market crash.

This is a sudden and sharp drop in stock prices.

So the 2008 market crash wiped out  billions in retirement savings.

You can also say the 2008 market crash  happened when the real estate bubble,  

the inflated prices when that bubble  burst, so when it quickly collapsed.

Frankly, I think before the the market  crash of 2008, many Americans looked at  

Social Security as you know, it's greens  fees, you know, I'll, I'll take it at 62.

So what if it's reduced?

It's no big.

Deal Now, of course, the stock market.

This is the place where shares of companies.

So a share represents ownership in a company.

A share of companies are bought and sold.

The stock market dropped today or the stock  market rose Today you can use both of those,  

and every day the stock market does both, it  drops and it rises usually like this every day.

Now let's talk about a bull  market and a bear market.

Have you heard these terms?

A bull market is when stock  prices trend up over time.

So it's not just today,  it's over a period of time.

So this represents a strong economy.

A bear market is when stock  prices trend down over time.

So not just for a day or a week,  it's a longer period of time.

It's a trend.

You can say investors made huge  profits during the bull market,  

but now we're in a bear market  and stocks are crashing.

So to crash this is a sudden and sharp decline.

You know, I can tell you we've  had a six year bull market.

There are a lot of bull market geniuses  out there right now who've got who have  

just been piling into the most speculative  stocks and they've been rewarded for that.

Let's talk about consumer spending.

This is the money people  spend on goods and services.

It's a key parts of the economy.

Now when inflation goes up,  consumers generally spend less.

So you can say consumer spending shrank during Q1,  

but is expected to bounce  back, improve, recover by Q3.

Do you know what I mean by Q1 and Q3?

Well, first let's talk about to shrink.

This means to reduce in size or amount.

And for Q1Q3, this represents the fiscal year,  

the fiscal year, which is 12 months,  but it's not the calendar year.

The fiscal year is generally divided into  

four quarters and those quarters are  Q123Q4 and each last three months.

So Q1 represents January, February, March,  

if you use the calendar year as your  fiscal year, which isn't a requirement.

So let's talk about credit.

This is Money borrowed that must  be repaid and often with interest.

So you can buy a house or a car on credit.

Now, higher interest rates make it more  expensive to buy a car or house on credit.

Section 4.

Employment and wages.

Let's talk about the unemployment rate.

This is often in the news.

This is the percentage of people who  are jobless but looking for work.

So retired people, children,  

they are not in the employment unemployment  rate because they aren't looking for work.

You can say the unemployment rate dropped last  month, showing signs of job market recovery.

So it's a positive thing when the  unemployment rate goes down, drops.

Now the job market, this is the availability  of jobs and the competition for them.

For example, with so many layoffs, the job  market is getting tougher for new graduates.

Remember, we already discussed layoffs.

This is job loss due to company cutbacks,  so companies aren't spending as much money.

The two fastest growing occupations  in the entire job market are solar  

panel installers and wind turbine technicians.

Now let's talk about the cost of living.

This is the amount of money needed to  cover basic expenses like housing and food.

So you can see the rising cost of living  driven by inflation is making it harder  

for many families to afford basic  necessities like groceries, rent.

So notice I used to be driven by, This  is very common in economic news to be  

driven by this means to cause something to happen.

Let's talk about the concept of productivity.

This is the amount of work  produced in a given time.

So productivity is a general term,  

but in the context of the economy,  it's the amount of work produced.

For example, companies are investing  in AI to boost worker productivity.

So boost, increase and cut costs.

So to cut costs means to  reduce or eliminate costs.

Now let me share a common idiom with you which  you might know, which is to make ends meet.

This is to earn just enough to cover  expenses but not anything additional.

So you don't have a lot of  additional consumer spending.

So you can say with inflation causing the cost  of living to soar to increase, suddenly many  

families are struggling to make ends meet or  struggling to cover their basic necessities.

Section 5 Policies and government.

Do you know what the concept  of monetary policy is?

Well, this relates to central bank decisions,  for example, setting interest rates.

And they do this to control inflation and growth.

So, for example, you see things in the news  like the Federal Reserve raised interest  

rates so they made them higher as part of  its monetary policy to fight inflation.

Now let's compare this to fiscal policy.

Fiscal policy represents government  

decisions on taxation and public  spending to manage the economy.

So you can say the government is using fiscal  policy to stimulate growth by cutting taxes.

So it's their decision on how  to manage their resources.

The present over the future,  

including fiscal policy and what would  be the equivalent of monetary policy.

Rome's under stretch over a period of time led  to its rot far more than its military adventure.

Now, of course, taxes, you know what this is.

This is Money collected by the government  from individuals and businesses.

So here are some phrases that  you as a consumer need to know.

When are taxes due?

Because you need to pay your taxes.

When are taxes due?

When is the deadline?

So the final date, the deadline  to file taxes, to submit taxes.

So you can use to submit taxes, but we  commonly use the verb file to file taxes.

Now let's talk about national debt.

This is the total money a government owes.

So it's the debt, the amount owning owing.

There can be consumer debt, personal debt,  but national debt is what your country owes.

So you can say the national debt is soaring,  

increasing sharply as the government  borrows heavily to cover is budget deficit.

So our deficit or a budget deficit,  this is when spending exceeds revenue.

Now let me share another idiom.

To be in the red or to be in the black.

So both of these use the verb to be and in the.

So notice that sentence structure.

If you're in the red, it's  bad, you're losing money.

That's why a lot of companies  will say we're bleeding.

We're bleeding because red blood  and it's gushing out of them.

It's like money is leaving them.

We're bleeding, we're in the red in the black.

That's positive.

It means the company is profitable.

So you can say after years of being in the red.

So remember you need the verb to be.

In this case, is conjugated in the  gerund form because our preposition of  

after years of being in the red, the new  technology helped the company cut costs,  

reduce cost, eliminate cost,  and move into the black.

So we commonly use the phrasal  verb to move into to talk about  

the transition from one category to the other.

Now this may be a lesson you need to  review again and again because these  

terms may be new to you and may  be intimidating, but I promise.

Watch it again.

Review the lesson PDF, you can get it in  the description and I know you will have  

no difficulty under understanding these concepts  when you see them in the news or when your family,  

your Co workers, your friends are discussing  economic issues because they affect all of us.

So do you want me to keep helping you  understand and learn advanced vocabulary?

If you do put let's go, let's  go put let's go in the comments.

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