Wednesday, October 15, 2008

A Lesson in Finance

Once upon a time, in a place overrun with monkeys, a man appeared and announced to the villagers that he would buy monkeys for $10 each.
The villagers, seeing that there were many monkeys around, went out to the forest, and started catching them.
The man bought hundreds at $10 and, as supply started to diminish, they became harder to catch, so the villagers stopped their effort.
The man then announced that he would now pay $20 for each one. This renewed the efforts of the villagers, and they started catching monkeys again. But soon the supply diminished even further, and they were ever harder to catch, so people started going back to their farms and forgot about monkey catching.
The man increased his price to $25 each and the supply of monkeys became so sparse that it was an effort to even see a monkey, much less catch one. The man now announced that he would buy monkeys for $50!
However, since he had to go to the city on some business, his assistant would now buy on his behalf. While the man was away the assistant told the villagers, 'Look at all these monkeys in the big cage that the man has bought. I will sell them to you at $35 each, and when the man returns from the city, you can sell them to him for $50 each.'
The villagers rounded up all their savings and bought all the monkeys. They never saw the man nor his assistant again, and once again there were monkeys everywhere. Now you have a better understanding of how the stock market works.
I always thought the stock market was monkey business!


Carine said...

love the story Kacey-I don't know where you find them,but when you write them up-I find myself laughing and crying all at once

Empress Bee (of the High Sea) said...

well now that's just the truth!

smiles, bee

Shelby said...

what a great story! :) glad you voted already.. I can hardly wait. But I am a bit nervous.

Molly said...

It's all about greed and opportunism! Funny, but sobering story Kacey!irfed

Betty said...

Well said! Thinking of the stock market's functioning as monkey business is the best approach I've heard of yet. I'm trying really hard to not take it too seriously.


Matty said...

You have a wonderful way with words Kacey. Now I understand it much better. Well done!

Big Dave T said...

Speaking of monkeys, your Buckeyes are making monkeys out of the MSU Spartans right now. It's still the first quarter, but I wouldn't be too confident if I were a Spartan fan.

I always thought the stock market was a lot of monkey business. I think that man is the guy who handles my retirement account.

Cathy said...

I always knew it worked this way...:)