[quote=greekfire]@XBoxBoy: free markets would do a much better job of regulating themselves if they were allowed to fail. It’s the “too big too fail” bailouts and gov’t restrictions such as the Fair Housing Act that create a moral hazard.[/quote]
Well, I can certainly agree that moral hazard is an issue. But to me a much bigger issue is what’s to stop execs and others from looting their company? Or what’s to stop people like Madoff from running ponzi schemes? Or maybe more to the point, what’s to stop people from spending money to buy off politicians to then tax the population and give them the money? You can argue that “theoretically” the market will ultimately catch and punish these people. In practice I think these schemes often go on long enough that the culprits are never caught. (If it hadn’t been for the sudden stock market changes of 2008 ol’ Bernie would probably still be in business, not jail)
What I learned from the recent financial crisis is that there are a number of problems with “free markets” that just don’t self-regulate well at all. In theory they should, but in practice they don’t.
[quote=greekfire]It’s the people’s duty to act responsibly and respectfully towards one another.[/quote]
And so what do we do when they don’t? (Cause from the looks of things today, people definitely don’t) More regulations from the govt that is completely beholden to the crooks? Vote out the bums and vote in honest politicians? (If that’s your answer I got this bridge I’m trying to sell… could ya give me a call)
