The Modern Economy

We have a town”¦ it needs a mill and a lumber yard, some restaurants and shoe stores and all the rest. Fortunately the town has some wealthy citizens and can build what it needs. So one guy takes his money and invests in a new mill! A good idea! So he figures he will make a profit justified by the betterment it brings to the whole town. That”™s what Mr. Smith had in mind more or less with his Capitalism idea. But instead of the other wealthy citizens in the town investing in other things the people in the town need”¦ They place bets with each other on whether on not the mill will be successful. Naturally since none of the other infrastructure was invested in”¦ the mill fails. So does the town. And half the bettors win. Though its a poorer world in which they”™ll be spending their winnings. Modern economics in a nutshell.

Via.