194 THE BiG DROP
want dollars. They no longer trust dollars as a store of value.
They may get them because you got paid or you sold some-
thing. You dump the dollars and you buy some hard assets. It
could be gold, other precious metals, fine art or land.
The next thousand people have a critical threshold of five
hundred. That means five hundred people would have to quit
the dollar before they’re convinced to quit too.
The next million people have a critical threshold of ten
thousand. In other words ten thousand people would have to
quit the dollar before they quit.
These numbers on the right of the table are the thresholds
at which the numbers on the left also repudiate the dollar.
In case one, one hundred people quit the dollar. What hap-
pens? The answer is nothing. Nothing happens because you
haven’t hit the threshold for the next thousand people.
A hundred people quitting the dollar are like four people
running out of the room in my example. It’s not enough to get
anyone to do anything and so the dollar is stable.
If you move to case two, what I call the “critical state”,
you’ll notice that I’ve lowered the threshold from five hundred
to one hundred for the first group. I’ve also lowered the thresh-
old from ten thousand to one thousand for the second group.
All the rest is unchanged. I haven’t changed the information
for the other 310 million people. All I’ve changed are the pref-
erences of three one thousandths of 1% of the population.
Now what happens?
When one hundred people quit the dollar the threshold for
one thousand people to also quit is hit.
When those thousand people quit the dollar the threshold
for one million people to quit also is hit.
At one million people quitting the dollar, you’re way past
the threshold for ten million more people to quit it too.
At ten million people quitting the dollar you’ve hit the
threshold for a one hundred million people quitting the dollar.