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 thousands 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.
Author
Topic: Monkeys (Read 427 times)