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How an Economy Grows and Why it Crashes by Andrew J. Schiff, Peter D. Schiff

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Chapter 1. AN IDEA IS BORN

AN IDEA IS BORN

Once upon a time there were three men—Able, Baker, and Charlie—who lived alone on an island. Far from a tropical paradise, the island was a rough place with no luxuries. In particular, food options were extremely limited. The menu consisted of just one item: fish.

AN IDEA IS BORN

Fortunately, the island was surrounded by an abundant population of strangely homogeneous fish, any one of which was large enough to feed one human being for one day. However, this was an isolated place where none of mankind's many advancements in fish-catching technology had arrived. The best these guys could do was jump in and grab the slimy buggers by hand.

AN IDEA IS BORN

Using this inefficient technique, each could catch one fish per day, which was just enough to survive to the next day. This activity amounted to the sum total of their island economy. Wake, fish, eat, sleep. Not much of a life, but hey, it beats the alternative.

And so, in this super- simple, sushi-based island society there were....

No savings!

No credit!

No investment!

AN IDEA IS BORN

Everything that was produced was consumed! There was nothing saved for a rainy day, ...

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