When the fish hits the fan,
Rezension bezieht sich auf: How an Economy Grows and Why It Crashes (Gebundene Ausgabe)
Economy is difficult. Many experts try to explain to us all the time, why prices rise or fall, why stock markets crash and they try to predict future developments - more often than not failing miserably. The reason, as Mr. Schiff explains, is a wrong basic concept, that has not been questioned for far too long despite it's negative outcomes and general lack of understanding of the fundamentals of how an economy works.
To address the latter problem and thereby explain why Keynes assumptions are wrong, he presents a story with which his father once explained economy to him: Three men on an island, catching fish by hand.
In the beginning, that's the whole economy on this island. They catch only one fish per person per day and that is exactly how much they need to survive. Then one of them has an idea: A contraption, with which to catch more fish - a net. This of course must be built first and during this day, the man goes hungry. He takes the risk, in order to raise his productivity. It works out and the islands economy grows. As their productivity rises, they have more time to invest in other projects as in building huts and making clothes. With further rises in productivity they aquire bit by bit more goods and leisure time, all payed for in the currency of fish. We learn that invenstments can only be made by fish, that has been saved first!
Schiff gradually widens the concept and explains it's reference to real world economic developments.
From the crash of the hutmarket to fishflation - economy has never been explained this simple and funny.