I came across a wonderful joke about money that is actually a great example of how money works. We studied in higher secondary economics that the quantum of money is not important, but the velocity of money is important for the economy.This works in real life, too. So before I continue to bore you, have a look at the joke, yourselves:
One day a tourist comes to the only hotel in a debt ridden town.
Lays a $100 note on the table & goes to inspect the rooms.Hotel owner takes the note & rushes to pay his debt to the butcher.
Butcher runs to pay the pig farmer. Pig farmer runs to pay the feed supplier.
Supplier runs to pay the prostitute, who in these hard times gave her services on credit.
Hooker then runs to pay off her debt to the hotel owner for the rooms she rented for her clients.
Hotel owner then lays the $100 note back on the counter.
The tourist comes down, takes his money & leaves as he did not like the rooms.
No one earned anything.
But the town is now without debt & looks to the future with a lot of optimism.
And that is how the world is doing business today