Something interesting I read today...
Discussion
(and also quite funny I might add)
The Cycle of Debt.
It's a hot, steamy August in a small lake town in the United States. It's raining. There is little to do, the town is mostly deserted and the recession is getting worse.
A rich tourist arrives in town to the local hotel and lays a $100 bill at the reception's counter and goes off the inspect the facilities.
When the tourist is out of sight, the hotel proprietor puts the $100 bill in his pocket and runs to pay his debt to the butcher.
The butcher in turn then runs off down the block to pay his debt off to the pig farmer.
The pig farmer in turn then gets into his car to the animal feed store to pay off his debt.
The feed store manager then runs drives back into the town, runs up the hotel's back stairs and pays off his debt to the town's prostitute who has been offering her services on credit.
The hooker skips down the front stairs and happily pays off her bill at the hotel she has been staying in to the hotel proprietor with the same $100 bill.
The hotel proprietor then puts the $100 bill back on counter just as the rich tourist is back after inspecting the hotel's facilities.
The rich tourist then says, "Sorry, I don't want to stay", picks up his $100 bill and leaves town.
No-one actually earned anything but the whole town is now without debt and looks to the future with a lot more optimism.
The Cycle of Debt.
It's a hot, steamy August in a small lake town in the United States. It's raining. There is little to do, the town is mostly deserted and the recession is getting worse.
A rich tourist arrives in town to the local hotel and lays a $100 bill at the reception's counter and goes off the inspect the facilities.
When the tourist is out of sight, the hotel proprietor puts the $100 bill in his pocket and runs to pay his debt to the butcher.
The butcher in turn then runs off down the block to pay his debt off to the pig farmer.
The pig farmer in turn then gets into his car to the animal feed store to pay off his debt.
The feed store manager then runs drives back into the town, runs up the hotel's back stairs and pays off his debt to the town's prostitute who has been offering her services on credit.
The hooker skips down the front stairs and happily pays off her bill at the hotel she has been staying in to the hotel proprietor with the same $100 bill.
The hotel proprietor then puts the $100 bill back on counter just as the rich tourist is back after inspecting the hotel's facilities.
The rich tourist then says, "Sorry, I don't want to stay", picks up his $100 bill and leaves town.
No-one actually earned anything but the whole town is now without debt and looks to the future with a lot more optimism.
Edited by Schermerhorn on Thursday 24th December 17:02
sounds about right!
Er, you do realise that the hotel proprietor is down $100, don't you? The scenario relies upon each person owing and being owed $100. The hotel proprietor owed $100 and the note paid that off, but he was owed $100 by the hooker. She paid him, but the payment was taken by the tourist.
Zod said:
Er, you do realise that the hotel proprietor is down $100, don't you? The scenario relies upon each person owing and being owed $100. The hotel proprietor owed $100 and the note paid that off, but he was owed $100 by the hooker. She paid him, but the payment was taken by the tourist.
He's not, is he?Zod is right. The hotel owner no longer owes $100 but has effectively written off the $100 debt owed him by the prostitute.
No, wait, that makes him even. If the prostitute had paid him first, he'd have just gone off and paid the butcher, thus no longer be in debt. So I change my mind. The hotel proprietor has not lost $100 but has instead benefitted from an interest free loan, which he has repaid in full.
No, wait, that makes him even. If the prostitute had paid him first, he'd have just gone off and paid the butcher, thus no longer be in debt. So I change my mind. The hotel proprietor has not lost $100 but has instead benefitted from an interest free loan, which he has repaid in full.
Edited by Alfanatic on Monday 24th August 13:28
Alfanatic said:
Zod is right. The hotel owner no longer owes $100 but has effectively written off the $100 debt owed him by the prostitute.
So, he used to owe someone $100 and was owed $100. Purely based on that, his net-worth was 0. He now owes noone and is owed nothing, so his net-worth remains 0.How has he lost out?
Gassing Station | The Lounge | Top of Page | What's New | My Stuff