Once upon a time in a village in India , a man announced to the villagers
that he would buy monkeys for $10.
The villagers seeing there were many monkeys around, went out to the forest
and started catching them.
The man bought thousands at $10, but, as the supply started to diminish, the
villagers stopped their efforts. The man further announced that he would now
buy at $20. 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 rate increased to $25 and the supply of monkeys
became so little that it was an effort to even see a monkey, let alone catch
The man now announced that he would buy monkeys at $50! However, since he
had to go to the city on some business, his assistant would now act as
buyer, on his behalf.
In the absence of the man, the assistant told the villagers: 'Look at all
these monkeys in the big cage that the man has collected. I will sell them
to you at $35 and when he returns from the city, you can sell them back to
him for $50.'
The villagers squeezed together their savings and bought all the monkeys.
Then they never saw the man or his assistant again, only monkeys everywhere!