I originally wrote this as a comment about 'stimulus' on the ever excellent Cedar Lounge Revolution, but thought it deserved a smaller audience.
CM: Ah Mr Shopkeeper, back again already? How can I help you?
SK: Well Mr CreditMarkets, I’d like to, eh, borrow a little bit more please.
CM: So soon? Didn’t we lend you two billion last month?
SK: You did, you did. And thank you very much. But we’ve spent it.
CM: On improving the shop, like we discussed?
SK: Well after the interest payments to you and the expenses in the shop we didn’t have much left over so we had to stop the improvements as they got fierce expensive. Sales are still heading south.
CM: So what is the new money for?
SK: [cheerfully] We’re going to spend it in the shop!
SK: We’re going to raise our sales by spending the loan money in it. Sure we’ll get half of it back again. Maybe even more!
CM: Half of it back?
SK: Yes! And then we’ll spend that half in the shop too! Or employ some more staff. They spend most of their wages in the shop you know.
CM: But.. surely, that can’t go on forever.
SK: Oh but it can, as long as you keep lending us the money. It’s called the ‘multiplier effect’. I would have thought a man in your position would know of it. It’s very popular amongst all the shopkeepers these days.
CM: How silly of me. Now tell me, how are sales going?
SK: Oh sales are still heading south at a rate of knots…
CM: Times are indeed tough for everyone.
SK: And we’re really quite expensive, what with all the staff and such. A lot of customers are going elsewhere
CM: But you have to cut your expenses! This is madness!
SK: Oh but we have. The staff now make a significant contribution to the cake fund.
CM: The cake fund? What the ..? Listen. How long more do you think we’re going to keep loaning all this money? I know it’s all backed by that cousin of yours in Brussels-
SK: He’s in Frankfurt actually.
CM: Whatever. What happens when he gets tired of shelling out all that money when the only security he has is on all that overpriced stock you have?
SK: Well [winks] he is rather depending on us for that vote thingie in October isn’t he?
CM: So he is, so he is.
SK: So, about that money ..?
CM: Will a cheque do?
SK: Cash if you don’t mind.
CM: Yeah, I wouldn’t trust the banks around your way either.
SK: See you in October!