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Thread: The failure of the free market: what are the alternatives?

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    Politics.ie Member Hewson's Avatar
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    Default The failure of the free market: what are the alternatives?

    The link below is to an article penned by Edward Hadas on Reuters. In it he raises the question of more market regulation and what, if any, benefits might flow from it.

    The experience of recent years has confirmed to all but the most fanatical free-marketeers (usually those with a vested financial interest in retaining the status quo) that the current policy of hands-off regulation has been disastrous economically, and in its subsequent toll on society generally.

    Excessive market volatility distorts the rest of economy. Exchange rates always move too fast for companies to respond sensibly. Share price frenzies lead to unhelpful excesses and shortages of new capital. Bond prices are generally less flighty, but the rapid emotional gyrations in the euro zone government bond market – overconfidence followed by panic – brought the region into crisis. When a decade of blind investor optimism suddenly exploded into the financial panic of 2008, developed economies entered a recession which has not yet ended.
    Everybody is affected by how the markets operate. Whether you are unemployed or retired, a CEO or self-employed, a factory worker or home carer, what happens in the world's markets has a direct bearing on your quality of life, for good or ill. We've seen this in spectacular fashion here in Ireland with the dot com bust and the implosion of the banking system through lack of oversight and the destructive effects of unfettered, naked greed.

    For several years I've dabbled in shares and have watched their values fluctuate wildly as irrational waves of panic swept the markets, followed by equally irrational waves of optimism, usually based on QE.

    The questions that arise from the attached article are both of ethics and morality and the freedom of markets to function without interference, regardless of the cost to the 99%.

    After the catastrophe of 2008 is the world ready to grasp the nettle of regulation in the interests of those who habitually pay the price, literally and in terms of a poorer society, for the unending greed of the one percent?

    And how do we begin to develop an acceptable model?

    The menace of financial markets | Edward Hadas
    Abortion is an act of violence. Violence demeans humanity, particularly violence against women and children.

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    Politics.ie Member seabhcan's Avatar
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    The alternative to the 'free market' is a properly regulated market.

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    Politics.ie Member LamportsEdge's Avatar
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    There was one form of market regulation that was pretty much automated until recent years, it was ubiquitous and everyone understood it.

    That was the subordination of business interests to the interests of the society and nation around it.

    I can't help noticing that ever since 'globalisation' became an excuse for letting supranational corporations dictate terms to national governments that we seem to have come a cropper somewhat.

    Standard Oil once started dictating to the US government when it almost escaped national control. The US government very wisely broke it up.

    When I say 'supranational corporations' I mean banking corporations and their close partners in organised crime and of course any business endeavour which manipulates its profile in order to sell to everyone and pay tax to no-one.

    I include the IMF, ECB and Federal Reserve in the United States among those 'supranational corporations'.
    Whenever understanding exists, accepting or rejecting is unnecessary. (Fundamentals of a Gnostic Education).

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    GDPR Deleted
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    Quote Originally Posted by Hewson View Post

    After the catastrophe of 2008 is the world ready to grasp the nettle of regulation in the interests of those who habitually pay the price, literally and in terms of a poorer society, for the unending greed of the one percent?


    No.

    The land of the free will never go for it and until they do, no one can go for it.

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    Politics.ie Member stopdoingstuff's Avatar
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    The very definition of a free market includes people who make losses going out of business, and this appears not to be the case the way we run things. What we appear to have is a bad case of crony capitalism, where even the regulations are written to suit the incumbents. So where one's success depends in laws and regulations, the hottest commodities become legislators and regulators. Therefore I can conclude that a very, very good way to start would be to get the money out of politics.
    Faoi mhóid bheith saor

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    Politics.ie Member stopdoingstuff's Avatar
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    The next would be to outlaw bailouts for any institution that does not submit to very conservative regulation.
    Faoi mhóid bheith saor

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    Politics.ie Member linny55's Avatar
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    There is no such thing as a Free Market , it is rigged.

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    Politics.ie Member Hewson's Avatar
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    Quote Originally Posted by tonic View Post
    No.

    The land of the free will never go for it and until they do, no one can go for it.
    The United States will no longer be the world's most powerful economy in a few short years, as China overtakes it. While the Chinese model of capital-based Communism is deeply flawed, the US model has had a far more destructive effect world-wide.

    We need something in between the two.
    Abortion is an act of violence. Violence demeans humanity, particularly violence against women and children.

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    Politics.ie Member seabhcan's Avatar
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    Quote Originally Posted by LamportsEdge View Post
    There was one form of market regulation that was pretty much automated until recent years, it was ubiquitous and everyone understood it.

    That was the subordination of business interests to the interests of the society and nation around it.
    I disagree. The state has almost always served business interests as its first objective. Any 'golden age' period is a myth.

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    Politics.ie Member Hewson's Avatar
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    Quote Originally Posted by linny55 View Post
    There is no such thing as a Free Market , it is rigged.
    Correct. And rigged to such an extent that financial institutions can fail and be saved by those most badly affected.
    Abortion is an act of violence. Violence demeans humanity, particularly violence against women and children.

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