Once upon a time, in a village near you, a CEO appeared and announced to the villagers that he would buy monkeys for ?10 each. The villagers, seeing that there were many monkeys around and money to be made, went out to the forest and started catching them.
The CEO bought thousands at ?10 but, as supply started to diminish, the villagers stopped their efforts. To counteract this decline the CEO announced that he would now buy monkeys at ?20 each. This renewed the efforts of the villagers and they started catching monkeys again.
Soon the supply diminished even further and people started going back to their farms. The offer increased to ?25 each and the supply of monkeys became so little that it was an effort to even see a monkey, let alone catch it!
The CEO now announced that he would buy monkeys at ?100 each! However, since he had to go to the city on business, his financial director would buy on his behalf.
In the absence of the CEO, the financial director told the villagers, "Look at all these monkeys in the big cage that the CEO has collected. I will sell them to you at ?50 and when the CEO returns from the city, you can sell them back to him for ?100 each, thus making 100% profit."
The villagers hurried round with all their savings and bought all the monkeys.
Then they never saw the CEO nor his financial director again, only monkeys!
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Now you know exactly how the stock market and the banking system works.