The Big Lie Continues

Even with the latest news about AIG, it seems that people like Paul Krugman still are insisting that we have “unregulated free markets” on Wall Street. The truth is that we never had “free markets;” we have had markets being backstopped by the Federal Reserve System, which hardly makes them free.

Reckless? Yes, but don’t forget that the free market is based upon a profit and loss system, as losses are just as important to economic calculation as are profits. By agreeing to absorb the losses that these reckless firms have accumulated, the Fed has undermined free markets, not supported them.

Paul Krugman needs to go back to school. Preferably, Mises U.

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8:46 pm on September 16, 2008