Several studies in the last three years indicate that close binaries, i.e. those with periods of ≲3 d, are very commonly found to have a third body in attendance. We argue that this proves that the third body is necessary in order to make the inner period so short, and further argue that the only reasonable explanation is that the third body causes shrinkage of the inner period, from perhaps a week or more to the current short period, by means of the combination of Kozai cycles and tidal friction (KCTF). In addition, once KCTF has produced a rather close binary, magnetic braking also combined with tidal friction (MBTF) can decrease the inner orbit further, to the formation of a contact binary or even a merged single star.

Some of the the products of KCTF that have been suggested, either by others or by us, are W UMa binaries, Blue Stragglers, X-ray active BY Dra stars, and short-period Algols. We also argue that some components of wide binaries are actually merged remnants of former close inner pairs. This may include such objects as rapidly rotating dwarfs (AB Dor, BO Mic) and some (but not all) Be stars.