Financial Crisis : Analyze This

 | August 02,2010 08:43 am IST

 

It is August.

In a small town on the South Coast of France, holiday season is in full swing, but it is raining so there is not too much business happening. Everyone is heavily in debt.

Luckily, a rich Russian tourist arrives in the foyer of the small local hotel. He asks for a room and puts a Euro 100 note on the reception counter, takes a key and goes to inspect the room located up the stairs on the third floor.

The hotel owner takes the banknote in hurry and rushes to his meat supplier to whom he owes Euro 100.

The butcher takes the money and races to his supplier to pay his debt.

The wholesaler rushes to the farmer to pay Euro 100 for pigs he purchased some time ago.

The farmer triumphantly gives the E 100 note to a local prostitute who gave him her services on credit. The prostitute goes quickly to the hotel, as she owed the hotel for her hourly room use to entertain clients.

At that moment, the rich Russian is coming down to reception and informs the hotel owner that the proposed room is unsatisfactory and takes his Euro 100 back and departs.

There was no profit or income. But everyone no longer has any debt and the small town people look optimistically towards their future.

Could this be the solution to the Global Financial Crisis? Or, is there a catch here?