CONTEST TIME! "How a stimulus package works"

[Tyranosauruss]

The Flaw:

When the motel owner gives the money back to the original party...he in effect has not 'retired' the prostitutes debt because he is still "out" for cost/profit for the room to the prostitute...no sale was made to the "new customer" as he didn't like the conditions of the rooms, so he took his money back, and the Motel owner did not "keep" (bank or use) the hundred so no debt was erased.. The basic flaw here is he's still a hundred short...I'm not much of a math or accounting guy, but I think this is correct...Tyrannosauruss

[crab65]

The prostitute should have stuck around and waited for the travler.. She could have gotten laid, made a $100.00 bucks and had the room for another month free of charge ..The travler might have stuck around the town for a few more sessions and spent some of that fine money he had tin his pockets.. Everyone could have profited by the prostitutes services..]

[dwilla]

Are you KIDDING?!?! The Flaw is that the prostitute, who is a woman presumably, WOULD NOT have offered her services on credit, No MON NO FUN! That being said, if she had given credit then once she got paid she wouldn't have stuck around. She'd be the only one smart enough to grab the money and RUN!

[MahiMahi]

I can't believe you all couldn't figure this one out!... The BIGGEST flaw is...

Since when did hookers start to render services on credit??? Come on "GUYS"... you know better!

: )

Now wheres that VIP?

[grelsin]

I agre with Splicer09. The motel owner didn't get to keep the $100 bill for room service provided to the hooker. Therefore the motel owner is out $100 because the tourist left with his $100.

[forHisglory]

Sounds like our welfare system. Producing nothing. Money is passed around like "monopoly money" and nothing is being produced, no profits, nothing to build on. The town people paid todays debt, but tomorrow will put them right back into debt. Sounding awfully familiar!!

[newest member]

if I were a tourist or traveler why would I lay a 100 dollar bill on the counter and walk off to inspect my room .....was it a motel 6

Everyone knows that our economy is so bad even Motel 6 don't leave the light on anymore!!!

[VIZIOIRAQI]

Stimulus package

It is a slow day in the small Saskatchewan town of Pumphandle, and streets are deserted. Times are tough, everybody is in debt, and everybody is living on credit.

A tourist visiting the area drives through town, stops at the motel, and lays a $100 bill on the desk saying he wants to inspect the rooms upstairs to pick one for the night.

As soon as he walks upstairs, the motel owner grabs the bill and runs next door to pay his debt to the butcher.

The butcher takes the $100 and runs down the street to retire his debt to the pig farmer.

The pig farmer takes the $100 and heads off to pay his bill to his supplier, the Co-op.

The guy at the Co-op takes the $100 and runs to pay his debt to the local prostitute, who has also been facing hard times and has had to offer her "services" on credit.

The hooker rushes to the hotel and pays off her room bill with the hotel owner.

The hotel proprietor then places the $100 back on the counter so the traveler will not suspect anything.

At that moment the traveler comes down the stairs, states that the rooms are not satisfactory, picks up the $100 bill and leaves.

No one produced anything No one earned anything... However, the whole town is now out of debt and now looks to the future with a lot more optimism.

And that, ladies and gentlemen, is how a Stimulus package works!

VIZIO

I WON

[jphillips]

So this isn't fair to all of us out here on the west coast who are still working on our first cup of coffee. I am going with dflake in the sense that, like our own QE2, TARP, etc. there is no additional value added to the system through a stimulus package. All it does is provide a temporary backstop to allow those in debt to extend their ability to perform in hopes that true economic demand will pick up. A bailout is just like a stimulus package and look where that got us with Bank of America, Citigroup, AIG and GM (Government Motors). Let's see, GM needs a bailout in Q4 and suddenly, voila, they are profitable the next Q1.

Stimulus is all about smoke and mirrors and has nothing to do with generating true wealth or value. Now let's compare this to the Dinar and what is about to happen. There are two perspectives here. The first is what happens to us, the private investor in Dinar. Well, this 'stimulus package' for us creates true wealth in that it changes the underlying value of our assets in the measurement system which we are grounding the IQD to - the USD. So for us it is a good stimulus package, but it doesn't change the wealth table from a comparative basis. That is the second point, using the Dinar to wipe out debt for a country (say the US for instance) doesn't change the underlying wealth table, it just allows us to go out and spend more on credit. Until we fix the real problem, spending more than we make, we only extend our ability to get ourselves in trouble.

It is like owning a home. Most people see this as their biggest investment. In reality, it is our biggest expense because we cannot create additional value from it although we can treat it as a sort of savings account. What do I mean? Well, we are all happy when the price of a home goes up, but if we sell ours to buy another house, well the price of that one has gone up to so our wealth basis has not changed.

So maybe to add to the previous posts regarding the flaw, the fly in the ointment of a stimulus package, it is really an expense as it doesn't change the wealth basis and decreases productivity as we are working to pay back revenue from previous services performed.

This was fun. Let's do it again.

[Tyranosauruss]

I've have already replied with contest answer but further thought and 'solution". If the Motel owner had told the guy if he took the room, he'd "throw in" a "bedmate" for the night for an EXTRA $100, allowed the prostitute to "work" off her debt in trade and kept the $200 from the Traveler...you'd have happy campers all the way around ! ESPECIALLY the "pig" farmer !! Ain't capitalism great?

[jphillips]

However, the whole town is now out of debt and now looks to the future with a lot more optimism.

And that, ladies and gentlemen, is how a Stimulus package works!

VIZIO

I WON

Great point Viz. Perception is a powerful tool in the hands of the government. Perception that the economy is moving forward encourages spending which generates true wealth. The gov't is completely trying to get us to drink this Kool-Aid right now. Hope it is a good flavor.

[motox565]

HOWS TRICKS?.....

I guess in the end the hotel owner got screwed by the hooker that payed her bill with his stolen money (which he couldn't keep)..... I guess stimulus crime doesn't pay........in the end.

Edited January 28, 2011 by motox565

[luv2hike27]

fractional banking at its best or worst!

[cruiser]

2 Answers:

#1: The analytical answer - The obvious is that there is no such town. Getting past that and assuming there were, there is no mention that the traveler ever actually "leaves" the hundred dollar bill on the counter prior to his inspection, thereby negating the remainder of the scenario.

#2: The philosophical answer - (assuming that $100 stayed on the counter) It worked only because the U.S. government was not involved in the transaction, or by the 3rd transaction, no money would have been left to exchange hands!!!

[Halo9678]

It is a slow day in the small North Dakota town of Pumphandle, and the streets are deserted. Times are tough, everybody is in debt, and everyone is living on credit. (If that is true then they are on more of a barter and trade system and the use of cash, while desired, is practically irrelevant)

A tourist visiting the area drives through town, stops at the hotel, and lays a $100 bill on the desk saying he wants to inspect the rooms upstairs to pick one for the night. (An "inspection can take anywhere from a minute to an hour depending on the state of the inspected item and the degree of proficiency of the inspector)As soon as he walks upstairs, the motel owner grabs the bill and runs next door to pay his debt to the butcher.

The butcher takes the $100 and runs down the street to retire his debt to the pig farmer.

The pig farmer takes the $100 and heads off to pay his bill to his supplier, the Co-op.

The guy at the Co-op takes the $100 and runs to pay his debt to the local prostitute, who has also been facing hard times and has had to offer her "services" on credit.

The hooker rushes to the hotel and pays off her room bill with the hotel owner.

(While all of these transactions are occurring, what exactly in the "inspector" doing? It is quite possible that the inpector know the value of his money and probably was able to get something of greater value while all of these minor transactions were occuring)

The hotel proprietor then places the $100 back on the counter so the traveler will not suspect anything.

At that moment the traveler comes down the stairs, states that the rooms are not satisfactory, picks up the $100 bill and leaves.

(So while Pumphandle thinks that their debts are resolved with each other, there may very well have been something take of greater value while they were all "blinded" by paying of the short term debt)

No one produced anything. No one earned anything. However, the whole town is now out of debt and looks to the future with a lot more optimism. (considering that the town ran on credit in the first place, this looks more like a feel good method to take their minds off of something larger taking place)

And that, ladies and gentlemen, is how a stimulus package works (the only thing that was stimulated was their propensity to spend as though nothing had happend. They have the perception of a zero balance and will being to spend (consume) again, likely as though nothing had ever happend)

My question is what did the inspector leave with...

That's just my SWAG (scientific, wild-eyed, guess) at it.

[gpoki]

If everyone in the chain does not pay their debt with their stimulus money, then the chain is broken. If the chain is broken, then the proprietor of the hotel will then be in debt to the traveler.

[mlay901]

I have read pretty close to 11 pages of responses (I'm sure that number will be doubled by the time I'm done with this reply) with almost all of them being well thought out and viable. I keep getting hung up on the fact that the motel owner is a thief. He stole the money in the first place...but that doesn't really have anything to do with the "stimulus theory"...or does it???

The great thing about this contest is that as a website owner Adam, you mentioned the word "FREE" in a contest and it has created a very "sticky" page for your website. Now, thinking along those lines, I would hope that you put this out there for a couple of reasons. 1. You have a feeling that the RV is very close and you have selflessly taken on a responsibility to all of your VIP members to give them the best post RV options in the world. With that said, making sure there are a couple of days of solid traffic that you can report back to the people that you have set these deals up with could be invaluable. 2. You have created an additional buzz and awareness of the VIP membership and it's immense value in a way that allows people imagine all of the security that comes with knowing you have their back post RV. Even if they have no idea how to invest a great amount of wealth, you will at least have options for them. Now, even if they don't win this contest, they have realized how great it is going to be in the moments after RV to know that they are VIP and SHOULD BE WILLING TO PAY FOR IT!!

I'm sure I am probably WAY off on my thinking here, but at the very least I have given an insight on how I feel about the VIP. If that helps even one person make up their mind to purchase this VIP with you I think it is worth my time to type this all out.

Thanks Adam for all you have done and plan on doing for us.

MLay901

[kasheppard]

The one flaw I saw in this, is the assumption that with a stimulus people are using the entire amount (in this case $100) to pay off debt already incurred. If the customer had paid the $100, the money could, in theory, made it through another round of debt paying. It is the idea of facilitating this money flow which is the basis to this theory.

That, however, is sort of a utopia. In true economic theory, the customers $100 did not add anything to the economy in the community. While debt was reduced, so were receivables by the same amount. Thus it is a zero sum game.

[Happy2010]

I like your thoughts on this. I thought about adding something like this to my answer. Gotta love the IRS. I think the traveler was an undercover IRS agent who watched the entire circle from the window upstairs and documented it all for a stimulus package later to be introduced called the "Government Always Gets Theirs".

I like your thoughts on this. I thought about adding something like this to my answer. Gotta love the IRS. I think the traveler was an undercover IRS agent who watched the entire circle from the window upstairs and documented it all for a stimulus package later to be introduced called the "Government Always Gets Theirs".

[Halo9678]

I have read pretty close to 11 pages of responses (I'm sure that number will be doubled by the time I'm done with this reply) with almost all of them being well thought out and viable. I keep getting hung up on the fact that the motel owner is a thief. He stole the money in the first place...but that doesn't really have anything to do with the "stimulus theory"...or does it???

The great thing about this contest is that as a website owner Adam, you mentioned the word "FREE" in a contest and it has created a very "sticky" page for your website. Now, thinking along those lines, I would hope that you put this out there for a couple of reasons. 1. You have a feeling that the RV is very close and you have selflessly taken on a responsibility to all of your VIP members to give them the best post RV options in the world. With that said, making sure there are a couple of days of solid traffic that you can report back to the people that you have set these deals up with could be invaluable. 2. You have created an additional buzz and awareness of the VIP membership and it's immense value in a way that allows people imagine all of the security that comes with knowing you have their back post RV. Even if they have no idea how to invest a great amount of wealth, you will at least have options for them. Now, even if they don't win this contest, they have realized how great it is going to be in the moments after RV to know that they are VIP and SHOULD BE WILLING TO PAY FOR IT!!

I'm sure I am probably WAY off on my thinking here, but at the very least I have given an insight on how I feel about the VIP. If that helps even one person make up their mind to purchase this VIP with you I think it is worth my time to type this all out.

Thanks Adam for all you have done and plan on doing for us.

MLay901

Adam acted like the traveller and through a bone out to everyone. So while "everyone" is scrambling around trying to balance their day to day lives, we take a few moments out to really think about what the RV (the $100) means in the grander scheme of things. Hell, I like the thought just for looking at the much larger picture. If I was a contender, give it to this guy!! Most of us stayed within the story, MLay went waaay outside the box. Awesome attempt. Hope it pays off!!!

[Happy2010]

I googled Pumphandle, North Dakota, and it is the offical Portal for North Dakota. Not the name of a town.

[Voyager_1700]

A true stimulus plan everyone would recieve the $100.00. Not just one to pass it to the next.

[quackr]

This was sent to me via email. I get a LOT of these, obviously... I mean, over 35,000 people have my email address.

I almost responded... but then I thought it would be better if the level headed, intelligent members of DV took a crack at it!

I mean, let's be honest. I can say a lot, but as a group you can all say MUCH MORE. (That's the premise of VIP and getting a better rate to cash in, but I digress...)

So, let's have some fun with this!

Please read the following... and I implore you to find the one serious flaw in this email.

What's at stake?

A FREE VIP MEMBERSHIP FOR TWO PEOPLE.

Yep, that's right! FREE VIP.

I am going to sponsor a 3 month VIP membership to two people:

1. The highest rated response
   
2. The first person to point out what I personally think is the biggest flaw in this "theory".
   

(Yes, this is a completely biased contest that could be considered rigged... whoever plays their cards right the fastest could end up with a HUGE benefit from a free VIP membership!).

On the other hand, you also have a chance to blast a tank sized hole in the logic of whomever wrote this piece of garbage... I think we ALL win here!

WARNING!!!! This is a "Thinking Person's" contest! Ignorant, blind, bleating sheep need not apply!

Here's the email:

Have fun, and may the best and highest rated answer win!

Contest ends in 48 hours.

[chupacabra]

The hotel owner stole the money to pay his debt. It wasn't his to do anything with but hold.

[Pockets]

Prositiution is the oldest profession and barter is how it was paid for....

The only flaw that I see is they did not work thru a trade and barter company..... I work for a trade and barter compnay and this is exactly the type of members we are looking for, where is Pumphandle??