finally financial crisis explained so you can understand it

Heidi is the proprietor of a bar in Berlin . In order to increase



sales, she decides to allow her loyal customers - most of whom are



unemployed alcoholics - to drink now but pay later. She keeps track



of the drinks consumed on a ledger (thereby granting the customers



loans).



Word gets around and as a result increasing numbers of customers flood



into Heidi's bar.







Taking advantage of her customers' freedom from immediate payment



constraints, Heidi increases her prices for wine and beer, the



most-consumed beverages. Her sales volume increases massively.







A young and dynamic customer service consultant at the local bank



recognizes these customer debts as valuable future assets and



increases Heidi's borrowing limit.







He sees no reason for undue concern since he has the debts of the



alcoholics as collateral.



At the bank's corporate headquarters, expert bankers transform these



customer assets into DRINKBONDS, ALKBONDS and PUKEBONDS. These



securities are then traded on markets worldwide. No one really



understands what these abbreviations mean and how the securities are



guaranteed. Nevertheless, as their prices continuously climb, the



securities become top-selling items.






One day, although the prices are still climbing, a risk manager



(subsequently of course fired due his negativity) of the bank decides



that slowly the time has come to demand payment of the debts incurred



by the drinkers at Heidi's bar.






However they cannot pay back the debts.






Heidi cannot fulfill her loan obligations and claims bankruptcy.



DRINKBOND and ALKBOND drop in price by 95%. PUKEBOND performs better,



stabilizing in price after dropping by 80%.



The suppliers of Heidi's bar, having granted her generous payment due



dates and having invested in the securities are faced with a new



situation. Her wine supplier claims bankruptcy, her beer supplier is



taken over by a competitor.






The bank is saved by the Government following dramatic round-the-clock



consultations by leaders from the governing political parties.






The funds required for this purpose are obtained by a tax levied on



the non-drinkers.









Finally an explanation we can all understand...







Thanks & Regards,










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