How the stock market works


Quickdraw

pit crew chief
Dec 28, 2006
273
How the stock market works

Once upon a time, in a village, 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, the villagers stopped their effort. He further announced that he would now buy at $20. This renewed the efforts of the villagers and they started catching monkeys again.

Soon the supply diminished even further and people started going back to their farms. The offer increased to $25 each and the supply of monkeys became so little that it was an effort to even see a monkey, let alone catch it!



The man now announced that he would buy monkeys at $50 ! However, since he had to go to the city on some business, his assistant would now buy on behalf of him.

In the absence of the man, the assistant told the villagers. "Look at all these monkeys in the big cage that the man has collected. I will sell them to you at $35 and when the man returns from the city, you can sell them to him for $50 each."

The villagers rounded up with all their savings and bought all the monkeys.Then they never saw the man nor his assistant again, only monkeys everywhere!




Now you have a better understanding of how the stock market works.
 

Neilda

GT Owner
Oct 19, 2005
3,559
London, UK
I would have been tempted to teach the Monkeys one or two menial tasks for which they would receive a small payment.

In time, the Monkeys could buy themselves out for, say, $40 each, this might attract more monkeys - at the same time you'd have a lot of tasks performed increasing the value of the troup.

I think you'd call this an MBO.


MBO?




Monkey?






Hello?











Is this thing working?











I'm here all week.......


TRY THE LIVER
 

Empty Pockets

ex-GT Owner
Mark IV Lifetime
Le Mans 2010 Supporter
Oct 18, 2006
1,362
Washington State
How the stock market works

Once upon a time, in a village, 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, the villagers stopped their effort. He further announced that he would now buy at $20. This renewed the efforts of the villagers and they started catching monkeys again.

Soon the supply diminished even further and people started going back to their farms. The offer increased to $25 each and the supply of monkeys became so little that it was an effort to even see a monkey, let alone catch it!



The man now announced that he would buy monkeys at $50 ! However, since he had to go to the city on some business, his assistant would now buy on behalf of him.

In the absence of the man, the assistant told the villagers. "Look at all these monkeys in the big cage that the man has collected. I will sell them to you at $35 and when the man returns from the city, you can sell them to him for $50 each."

The villagers rounded up with all their savings and bought all the monkeys.Then they never saw the man nor his assistant again, only monkeys everywhere!



You forgot to mention commissions & cap gains txs.

Neilda: take 2 asprin & PM me in the morning...