ekzept

I liked this article, thanks for sharing!
I think its really true what he says about how these failing systems works. Everyone knows their is not such thing as money for nothing, yet everyone is looking for a way to get as many for as less as possible. More money means higher risks. But we look for as many money as possible for the lowest risk possible. So we're actually 'looking' for a miscalculated risk, because then it looks attractive. It's funny really!

Still this is something which comes together with capitalism, if you try to protect the system with all kind of rules we will kill the free market with all the benefits of high efficiency. I think we just have to accept these crisises once in a while, the strong survive, so we will come out better. Over a longer period of time (decades) economies grow quite steady.

It's just like nature, sometimes there are disasters, like the flooding of a river, but in the end it does leave a fertile sludge behind. Building dikes around the river will perhaps make floods happen less frequent, but when they happen the consequences will be much bigger.

Thanks for your reply.
You are right you shouldn't say something is the best solution without questioning, which I may have suggested in my reply. The problem of the free market model is it doesn't exists in practice. My point is when you remove freedom from any market it's more difficult for this market to find an equilibrium by itself. So it tends to grow away from an equilibrium more then necessary until it has to fall back again. Less but greater fluctuations.
By the way I think a free market model is best for all businesses which can have a lot of competitors. Railway companies, drink water companies, etc. can never have competitors there is only one track or one water pipe, so I think these businesses are best state owned. So 'free market' or no market at all. But this is my opinion, I know this is debatable and there probably never will be a real answer.

You are right about the difficulty to predict risk or benefits. With the previous said this is why there should not be more regulations (in my opinion). Let me explain: With a lot competitors their will be some parties who will take a big risk they may gain some 'easy' money this money is lucky money because they did price their product above the equilibrium price, maybe some more competitors will try, but rather fast the system will fall back into it's equilibrium. Some will loose a bit.
When you regulate, the system can't reply as fast on this 'above equilibrium price'-price. Because it takes longer to restore more competitors will follow and they will be further away from the equilibrium. Many will loose a lot.
By the way, it also works the other way. Negativism on the market will last longer with lot of regulations (sell to cheap).

No doubt regulations to protect certain things (people, environment, etc) is a must.

I hope you appreciate my thoughts. That's all it is really, I'm not stating it is all true what I say, I is just the way I think about it. So be welcome to correct me, since you seem to have done more reading about the subject then I have

So if I may summarize, we both think many industries operate far from an economical ideal situation. You suggest we should try to push them as much towards a ideal situation as possible by controlling. I suggest we should leave the system alone as much as possible and let it restore towards the ideal situation on it's own.

Could I summarize it like that?
I feel both statements are arguable and it's probably hard to be curtain about what the best solution would be. What we can be sure of, is it will never be an ideal situation.

btw. the difference between large corporations and governments are their motives. Corporation want profit, so would like to exploit there customers, while government (should) want whats best for it's 'customers' without selfinterest.

Thanks for this interesting debate by the way!