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Message
re: Economics - How did this happen?
Posted on 7/13/20 at 5:35 am to Ricky1962
Posted on 7/13/20 at 5:35 am to Ricky1962
quote:
How did this happen?
quote:
A man goes to a Hotel and asks for a suite. The hotel owner says he has a suite for $200 per night. The potential guest asks to look at the suite before deciding. The hotel owner agrees, but asks for a $200 deposit to hold the room. The potential guest agrees, gives the owner $200 and goes to view the room. The hotel owner then goes to his meat supplier and gives him the $200 to pay off an old bill for steaks served in the hotel restaurant. The meat supplier goes to his butcher, gives him the $200 to satisfy his past due bill for the meat he bought to sell to the hotel. The butcher goes to his mistress to giver her the $200 he was supposed to pay her for her services she provided the prior evening. The mistress then goes to the same hotel referred to before and pays the owner $200 for the use of the suite the prior night, where she provided her services. Meanwhile, the prospective guest goes back to the hotel lobby and informs the hotel owner he changed his mind and asked for his $200 deposit back. The hotel owner gives it to him, using the money the woman just gave him.
0
Posted on 7/13/20 at 6:24 am to Ricky1962
Cash flow...
Posted on 7/13/20 at 6:26 am to Ricky1962
quote:
How did this happen?
It didn’t because there is no upcharge anywhere in there
Posted on 7/13/20 at 6:39 am to Ricky1962
I want to know how the money changed hands that many times in the amount of time it took a dude to go look at a room and come back.
Nobody pays money they owe to anyone that fast.
Story is BS.
Nobody pays money they owe to anyone that fast.
Story is BS.
Posted on 7/13/20 at 6:43 am to East Coast Band
quote:
All I know with all that money changing hands, the IRS is going to be happy
Only if they're using the cash method. If they're using the accrual method the revenue was recorded at the time of the original transaction.
Posted on 7/13/20 at 7:16 am to Ricky1962
Man has $200. Puts a deposit on the suite.
Hotel Owner has a suite worth $200/night, $200 in debt to the Meat Supplier, and is owed $200 by the mistress.
Meat Supplier is $200 in debt to the Butcher, and owed $200 by the hotel.
Butcher is $200 in debt to the Mistress. He got laid, and owed $200 by the Meat Supplier.
The Mistress is $200 in debt to the Hotel and owed $200 by the Butcher.
All debts get paid with the credit each was due. Hotel room is still worth $200 a night, and is available.
Here’s how this would actually work:
It’s not a zero sum game dipshit.
Hotel Owner has a suite worth $200/night, $200 in debt to the Meat Supplier, and is owed $200 by the mistress.
Meat Supplier is $200 in debt to the Butcher, and owed $200 by the hotel.
Butcher is $200 in debt to the Mistress. He got laid, and owed $200 by the Meat Supplier.
The Mistress is $200 in debt to the Hotel and owed $200 by the Butcher.
All debts get paid with the credit each was due. Hotel room is still worth $200 a night, and is available.
Here’s how this would actually work:
quote:
1. Mistress would demand $200 from the Butcher. He says he doesn’t have the money. She tells him to get bent and finds another John for that evening.
2. That John pays for the hotel for the night.
3. The Meat Supplier is a middleman, so while he sells $200 of steaks to the hotel, he bought them from the Butcher for $150. He likely has plenty of money from previous purchases and doesn’t mind staying $200 in debt temporarily.
4. The Butcher either created the meat out of thin air, or he got it from a farmer for $100 and added his own $50 surcharge to cut said meat.
5. The farmer 100 years ago bought a calf for $50 then used his land to turn it into a cow he sold for $100. He used $95 to tend the land and breed more cattle, and kept $5 for his own needs.
It’s not a zero sum game dipshit.
Posted on 7/13/20 at 7:24 am to Ricky1962
quote:
hotel owner has his $200.
That is a false statement. Owner takes 200 deposit and pays a debt, than owner gets debt payed to him of 200 and then owner pays deposit back of 200. The owner is actually out 200.
Posted on 7/13/20 at 7:26 am to Ricky1962
The only one with $200 is the potential guest at the end. It was the same $200 passed around for services owed/due and then passed along back to the hotelier who ultimately returned it to the potential guest resulting in everyone’s balance back to net $0
Posted on 7/13/20 at 7:26 am to Ricky1962
quote:
How did this happen?
It happened because of a very exacting set of circumstances that exist only in Fantasy Land.
The better question is "what does this mean?"
It means that while all debts were cancelled out, no one made a profit. If this were the same of all transactions our GDP growth would remain at zero because no new goods nor services could enter the market as there would be no room.
This also means the quality of those goods and services would eventually diminish because there was no profit to cover unexpected issues (light bulbs burning out in the hotel, steaks having to be tossed due to being left out next to raw chicken all night, the whore not being able to work because she got the shits from tainted meat, etc).
Posted on 7/13/20 at 7:28 am to stelly1025
quote:
That is a false statement. Owner takes 200 deposit and pays a debt, than owner gets debt payed to him of 200 and then owner pays deposit back of 200. The owner is actually out 200.
Disagree. The owner was down $200 at the beginning, before he gives the deposit back he's up $200. Giving the deposit back puts him (and everyone) at 0. No debt, but no profit either.
Posted on 7/13/20 at 7:30 am to GoldenGuy
quote:
1. Mistress would demand $200 from the Butcher. He says he doesn’t have the money. She tells him to get bent and finds another John for that evening.
2. That John pays for the hotel for the night.
3. The Meat Supplier is a middleman, so while he sells $200 of steaks to the hotel, he bought them from the Butcher for $150. He likely has plenty of money from previous purchases and doesn’t mind staying $200 in debt temporarily.
4. The Butcher either created the meat out of thin air, or he got it from a farmer for $100 and added his own $50 surcharge to cut said meat.
5. The farmer 100 years ago bought a calf for $50 then used his land to turn it into a cow he sold for $100. He used $95 to tend the land and breed more cattle, and kept $5 for his own needs.
I thought about going that route but I figured if someone was so bewildered by the original question then that might blow their minds.
Posted on 7/13/20 at 7:34 am to Bard
quote:
Disagree. The owner was down $200 at the beginning, before he gives the deposit back he's up $200. Giving the deposit back puts him (and everyone) at 0. No debt, but no profit either.
He is out the Deposit which was not his to begin with. He paid a debt on borrowed or unsecured money in this case which then came out of his pocket. The money wasn't his.
This post was edited on 7/13/20 at 7:36 am
Posted on 7/13/20 at 7:38 am to stelly1025
-200+200-200= -200
Posted on 7/13/20 at 7:39 am to Ricky1962
quote:Because the prostitute's services are apparently free.
How did this happen?
And the hotel manager is still out $200.
This post was edited on 7/13/20 at 7:40 am
Posted on 7/13/20 at 7:41 am to stelly1025
quote:
200+200-200= -200
He was minus 200 when the day started, because the hooker hasn't paid him. (Forget getting into the accounting of having a receivable on the books)
He was then even when the potential renter gave him the $200 deposit.
He was then $200 up when the hooker came and paid him.
He then went back to even when he had to give the potential renter the money back.
As I see it, anyway.
Posted on 7/13/20 at 7:44 am to Ricky1962
Make a balance sheet and write out the credits and debits for each business and the watch how the money moves.
I’m not doing your homework for you.
I’m not doing your homework for you.
This post was edited on 7/13/20 at 7:55 am
Posted on 7/13/20 at 7:45 am to Ricky1962
That is merry go round economics. It works like a charm.
Posted on 7/13/20 at 7:47 am to Ricky1962
How long did It take for the suite tour? That’s a lot of movement of money for a tour that probably lasted less than 20 minutes. I guess there was no traffic anywhere and everyone was readily available?
Posted on 7/13/20 at 7:48 am to LCA131
quote:
He was minus 200 when the day started, because the hooker hasn't paid him. (Forget getting into the accounting of having a receivable on the books)
Actually he was minus 400 when he started ,because he was owed 200 and he owed someone else 200. He used the deposit to pay his debt and received money that was owed to him. Then he payed the deposit back. So again it is -200+200-200. The owner is out 200.
Posted on 7/13/20 at 7:57 am to RDOtiger
quote:
The hotel owner did not come out with $200. He had to give it back to the guy who viewed the room, so he came out with $0
He actually came out with $200 worth of meat. He got $200 from the mistress for providing a room for her. He paid $200 for the meat to his meat supplier.
This post was edited on 7/13/20 at 7:57 am
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