You're not going to believe the recent revelation. No, really, you just won't:
Free-market thinking takes hit from US economic crisis
No way! Get the fuck outta town. Really?
WASHINGTON (AFP) - A deepening economic crisis has led to unprecedented actions by US policymakers that raise questions about how far government regulation should go in a free-market economy, analysts say.
The Federal Reserve, in addition to dramatically cutting interest rates, has opened up its massive reserves to Wall Street securities firms for the first time since the Great Depression in an effort to stabilize a jittery financial system.
This move, along with a Fed-engineered rescue of troubled investment giant Bear Stearns, raises the prospect of new supervision of Wall Street firms that had previously escaped regulators.
Well, fuck me gently and call me an altar boy ... who could possibly have imagined that fiscal irresponsibility on that scale might call for slightly stricter oversight? Did you see that coming? I didn't see that coming.
Allan Meltzer, a professor of political economy at Carnegie Mellon University, says the Fed agreement to guarantee 29 billion dollars in troubled Bear Stearns assets was a mistake.
"This action transferred potential losses from the market to the taxpayers," he said. "I do not believe the present system can remain if the bankers make the profits and the taxpayers share the losses."
But be careful here, kids; when it comes to pondering the inherent unfairness of big business privatizing the profit but socializing the losses, don't try that sort of logical analysis at home -- remember, Meltzer's a professional.
2 comments:
The financial economy is not the "real economy" and should never have been treated as a free market.
I'm thinking we should nationalise the means of production just to be nasty and spiteful. Would get the money-grubbers to sell off a few gold toilets, in any case.
The point of capitalism is to make profits for capital. The ideology of free markets is simply one instrument used to justify capitalism in terms of efficiency, allocation without force, etc.
In reality capitalism resorts to anything but free markets if it can, and it often can. Take intellectual property rights and patents. Big Manufacture, Big Drugs, and Big Agri..could not function without these. They are even enshrined in international trade deals. But the whole aim is to restrict knowledge and competition..
The main free market in economics is for trade in bullshit.
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