10/26/2008

How Wall Street Works

Once upon a time, in a village, a man appeared and announced to the villagers that he would buy dog balls for $10 a pair.

The villagers, seeing that there were many stray dogs around, went out to the neighborhoods and started catching them. The man bought thousands at $10 a pair.

And, as supply of stray dogs diminished, the villagers stopped their effort. But the man further announced that he would now buy dog balls at $20 for a pair.

This renewed the efforts of the villagers and so this time they started castrating their own pet dogs. Soon the supply diminished even further and people started going back to their farms. The man increased his offer to $25 each pair, but this time their were almost no supply of dog balls available. Since almost all the male dogs in their villages have no more balls, the dog population dwindled.

The man was very persistent and now he announced that he would buy a pair of dog balls 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 dog balls in these big containers that the man has collected. I will sell them to you at $35 a pair, and when the man returns from the City, you can sell them to him for $50 each pair." The villagers rounded up all their savings and bought all the dog balls.

They never saw the man nor his assistant again, only dog balls and gelded male dogs everywhere!

Now you have a better understanding of how Wall Street works!

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The next time you transact in Wall Street, be careful, you might loose your own balls in the deceptive process. :-)

Rise and fall of stock prices and values can easily be manipulated by large investors with very huge amount of reserves. Like gambling, it is always the ordinary gamblers who loose and not the casino.

When this stock market downturn is over, guess who will be holding most of the really valuable stocks? And guess what the ordinary/common investors will be left with? Their own castrated balls!