Economics Explained

It is June, 2009 in a little town in Northern California.

It is raining, and the tiny town looks totally deserted.

It is tough times, everybody is in debt and everybody lives on credit.

Suddenly, a rich tourist comes to town.

He enters the only hotel, lays a $100.00 bill on the reception counter and goes to inspect the rooms upstairs in order to pick one.

The hotel proprietor takes the $100.00 bill and runs to pay his debt to the butcher.

The Butcher takes the $100.00 bill, and runs to pay his debt to the pig grower.

The pig grower takes the $100.00 bill, and runs to pay his debt to the supplier of his feed.

The supplier of feed store takes the $100.00 bill and runs to pay his debt to the town's prostitute. (Who, in these hard times, gave her "services" on credit).

The hooker runs to the hotel, and pays off her debt with the $100.00 bill to the hotel proprietor for the rooms that she rented when she brought her clients there.

The hotel proprietor then lays the $100.00 bill back on the counter so that the rich tourist will not suspect anything.

The rich tourist comes down after inspecting the rooms, and takes his $100.00 bill, saying that he did not like any of the rooms, and leaves town.

No one earned anything.

However, the whole town is now without debt, and looks to the future with great optimism.