Tuesday, October 25, 2016
Rev. Frank Placone-Willey is to speak (30 October) at the Summit Unitarian Universalist Fellowship HERE
Same title as one of my early papers but probably not the same contents.
LOONY TUNES no. 182
Sandra L. Kisselback, Berne Historical Society, posts (20 October) on The Altamont Enterprise Opinion HERE
‘Or you could sense an invisible hand grazing your shoulder ever so mischievously.’
Steven Pearlstein, Business Editor and Robinson Professor of Public Affairs at the Schar School of George Mason University, posts (21 October) in The Washington Post HERE
“Will technological progress stymie the economies of advanced nations?”
“Avent is right about one thing: The economic and social institutions that once maintained social and political harmony by ensuring that wealth was fairly distributed are no longer working. Just as with the Industrial Revolution, he writes, it will take a “period of wrenching political change” before new institutions will emerge. It is not enough, he warns, to simply leave it to the “invisible hand” to work out the new arrangements, for as we’ve learned in recent years, the invisible hand turns out to be nothing more than “the thudding fist of the powerful.”
Mosharraf Zaidl posts (25 October) The News (International)
The Lockdown and the Invisible Hand Mafia
The invisible hand, of course, is Adam Smith’s original formulation of the unintended positive collective outcomes, based on intentional private actions. My use of the term here is referring to anything but positive collective outcomes. In short, I am employing irony. I make that clear here because it is easy to misinterpret. And Pakistan’s invisible hand mafia’s principal expertise is to work for the benefit of the few, at the expense of the many. In this way, it is the reciprocal equivalent of Adam Smith’s invisible hand. Hence, invisible hand mafia.
Congratulations to Mosharraf Zaidl for getting Adam Smith's meaning correct when he used the metaphor of "an visible hand".
Monday, October 24, 2016
WORTH THINKING ABOUT
David Rotman posts (12 October) HERE
Capitalism Behaving Badly
It’s time to rethink the role that government plays in shaping and supporting policies to solve big problems like climate change and income inequality.
Despite healthy corporate earnings, an employment rate that has slowly rebounded since the financial crisis of 2008, and the outpouring of high-tech distractions from Silicon Valley, many people have an aching sense that there is something deeply wrong with the economy. Slow productivity growth is stunting their financial opportunities; high levels of income inequality in the United States and Europe are fueling public outrage and frustration in those left behind, leading to unprecedentedly angry politics; and yet despite the obvious symptoms, economists and other policy makers have been largely befuddled in explaining the causes and, even more important, the cures for these problems.
That’s the starting point for Rethinking Capitalism. A series of essays by authors including Joseph Stiglitz, an economist at Columbia University who won a Nobel Prize in 2001, and Mariana Mazzucato, a professor of the economics of innovation at the University of Sussex and a rising voice in British politics, the book attempts to provide, as explained in its introduction, “a much better understanding of how modern capitalism works—and why in key ways it now doesn’t.” Together, the essays provide a compelling argument that we need more coherent and deliberate strategic planning in tackling our economic problems, especially in finding more effective ways to reduce greenhouse-gas emissions. …
In particular, Mazzucato, who also co-edited the book and co-wrote an introduction with Michael Jacobs, wants to counter the view that free markets inevitably lead to desirable outcomes and that freer markets are always better: the faith that “the ‘invisible hand’ of the market knows best.” In fact, she argues, we should admit that markets are created and shaped by government policies, including government support of innovation.
There is nothing too contentious in that statement, but she extends the argument in a way that is controversial. Not only is it the responsibility of governments to facilitate innovation, which she calls “the driving force behind economic growth and development,” but the state should also set its direction; the trajectory of innovation needs to be guided by policies to solve specific problems, whether the aim is increasing productivity or creating a green-energy transition. Mazzucato writes that innovation needs both “well-funded public research and development institutions and strong industrial policies.”
Industrial policies—or what Mazzucato sometimes calls mission-oriented public policies—have a long and divisive history. Economists define industrial policy in a very specific way: it’s when governments set out to play a deliberate role in directing innovation and growth to achieve a desired objective. Her call for the revival of such policies counters the idea that has held sway for decades among many politicians, particularly in the United States and the U.K., that government is better off not trying to assert a role in steering innovation. She writes that governments should not only try to “level the playing field, as orthodox view would allow.” Rather, “they can help tilt the playing field towards the achievement of publicly chosen goals.”
For them to do so, Mazzucato said, “the whole framework needs to change.” The belief that the government should only intervene to “fix” the market in extreme circumstances, rather than acting as a partner in creating and shaping markets, means we’re constantly putting “bandages” on problems and “nothing changes.” The intractability of today’s slow growth and widening inequality can be traced, she says, to the fact that governments in the U.S. and Europe have increasingly shied away from their responsibilities. “We have to admit that policy steers innovation and growth, and so the question is where do we want to steer them?” …
The stimulus energy investments were “a bit of a disaster,” says Josh Lerner, a professor at Harvard Business School. “A lot of the problem was in the ways they were implemented. They violated all the rules of how these things should be done.” Not only did the government make large bets on a few companies, in effect picking winners, but it did so without clear rules and criteria for the choices. And, says Lerner, “the selection of the battery and solar companies was extremely opaque. A lot of it seemingly came down to if you had a former assistant secretary of energy doing the lobbying for you.” …
Still, Lerner is not dismissive of government interventions to support green-energy innovation. “You can make the case that the need is greater than ever. A well-designed program would potentially make a lot of sense at this point.” But, he says, “experience tells us there are more misses than hits” with such government interventions. And he suggests that such programs often fail because their creators are not familiar enough with any given technology and its business. “The decisions might seem plausible, but they turn out to be unproductive. The devil is in the details.” …
Even some of the stimulus’s greatest apparent successes now seem to be less effective than originally hoped. Steven Chu, a Nobel Prize–winning physicist, was named secretary of the Department of Energy in early 2009 and implemented many of the bill’s most ambitious efforts to boost energy R&D. It funded large increases in energy research, and Chu created a series of well-conceived centers and initiatives, including the Joint Center for Artificial Photosynthesis and ARPA-E, a program to support early-stage energy technologies. But in subsequent years, budget cutbacks and political pressure took their toll on these projects, which needed patience and consistent funding. As a result, ambitious research and technology initiatives are now ghosts of their once high-profile selves.
The outcome makes one wonder just how such policy initiatives, which include investments in research and engineering projects that require years to bear fruit, will ever survive the constantly changing political moods and government leadership. Creating a rigorous industrial policy to encourage green technologies is no doubt a worthwhile objective. Economists and the lessons from efforts like the stimulus bill can teach us how to design such policies to be robust and effective.
But won’t wise industrial policies also require wise politicians?
SENSE AND SENSIBILITY no 2
Professor Vernon L. Smith, Chapman University: HERE
"Adam Smith on Conduct and Rules: Trust Games; Emergence of Property"
“The Theory of Moral Sentiments (TMS, 1759) concerns human sentiment as the source of the rules we follow that accounts for our sociality. It also provides a unique framework for analyzing and modelling decisions in two-person games such as “trust” games. Neo-classical economic (game) theory failed to predict action in these experiments in the 1990s. If we had known and applied Adam Smith’s model based on mutual fellow-feeling these results would not have been unexpected. I will use propositions from TMS to show why, and indicate how, Smith’s model was more appropriate for explaining/predicting these results than the traditional neo-classical (and game-theoretic) models that displaced—rather than supplemented—his model.
Smith sees individuals as simultaneously self-interested and highly social. Our sociability takes the form of learning to “humble the arrogance of our self-love and bring it down to what others will go along with.” Common knowledge that individuals are self-interested is necessary in Smith’s model for people to know who benefits and who is hurt by an action, and is essential in learning social competence through processes that punish intentionally hurtful acts and reward intentionally beneficial acts. Out of such consent processes emerge ancient rules of morality in which propriety governs virtues like trust and trustworthiness. In the larger civil order these rules of propriety become the basis for a broad conception of property, as rights to take action without reprisal applied to both possessions and contracts. In that extended order of markets our sociability enters axiomatically in the form of our “propensity to truck, barter and exchange.” This propensity, combined with third party enforcement of property—a natural extension of the practiced cultural rules of conduct—enables self-interested action among strangers to create wealth through specialization.
Hence, Adam Smith provides a seamless account of other-regarding behavior in our more intimate social groups, setting the stage for our pursuit of specialization in the extended order of impersonal markets.”
SOME YEARS AGO WHEN I WAS ABLE PHYSICALLY TO ATTEND INTERNATIONAL GATHERINGS OF ADAN SMITH SCHOLARS, VERNON SMITH STOOD OUT AS AN EXCEPTIONALLY CLEAR EXPONENT OF ADAM SMITH'S WORKS AND MODERN RELEVANCE.
IT IS A PLEASURE TO INCLUDE AN EXTRACT OF VERNON SMITH'S THINKING AND EXPOSITION OF THE WORK AND IDEAS OF ADAM SMITH ON MY NEW COLUMN.
Sunday, October 23, 2016
BEST NOT TO IGNORE GOOD ADVICE
FROM AN UNPUBLISHED PAPER OF MINE in 2008:
"At the 40th Annual Conference of the UK History of Economic Thought, held in Edinburgh in September 2008, when I presented a paper, “Adam Smith’s Invisible Hand: from metaphor to myth” (later, I re-wrote the paper, keeping the title), it was my first acquaintance with most of the international HET scholars in attendance. Most of those who contributed to the session’s discussion that followed were largely critical of my paper for several reasons.
However, Professor Mary Morgan (LSE) afterwards gave me some valuable advice privately on how to criticise widely accepted ideas to scholarly audiences, of which advice I took note.
My paper, she pointed out, did not open with a statement about the various ways in which modern economists use the invisible hand metaphor and, in consequence, it was not clear, she suggested, exactly to what I was objecting, other than my assertion that Adam Smith did not mean the invisible hand to be treated other than as a metaphor.
She asked if was I criticising the theory that an invisible hand guiding self-interested, even selfish, actions, whatever the intentions of the actors, produced benign outcomes? Or was I denying that the invisible hand was a mechanism that operated in markets, through prices and supply and demand? Making this clear, she advised, would guide listeners to the point I was making.
A theory, she added, can always be tested to decide if it corresponds to, or explains, experience. For example, the claim that Adam Smith believed that “self-interested” – even “selfish – behaviours” led to “public benefits” could be tested by specific instances where this was or was not evident in practice. It could also be contrasted with my claim that because Adam Smith refers in Books 1, 2, and 3 of Wealth Of Nations to over 80 instances where the selfish/self interested behaviours of individuals had malign consequences for those affected rather than leading to private, not public, benefits, as claimed for modern versions of the “invisible-hand”.2
On reflection later, I accepted Professor Morgan’s objective advice (she did not indicate whether she agreed or otherwise with me on the invisible hand).
However, since that conversation, I have tried to be wary of ignoring her advice. If readers were left in the dark about the significance of what I have been trying to say since 2005, I would merely be having conversations with myself."
I was looking through my files of my previous writings on the “invisible hand” and among them I noted the above paragraphs of a most relevant and interesting account of my response to Professor Mary Morgan’s (London School of Economics) advice.
It is a timely reminder as I commence writing my 3rd book on Adam Smith (details will be released in due course). I shall, of course, also apply Professor Morgan’s advice to my general writing on my Blog: - (www.adamsmithslostlegacy.blogspot.co.uk).
Looking through recent items, I sometimes descend to mockery of the writings on the “invisible hand’ in the public media, if only from my exasperation…
I shall try to do better.
VISIBLE PRICES ENABLE MARKETS TO WORK
Englewood Staff post (222 October) on Englewood Daily HERE
"Turbulent Week Ends, How Did This Stock Fare: Eastman Chemical Co. (NYSE:EMN)"
“Stock indexes closed mostly lower on Friday as the telecom sector bore the brunt of selling. The S&P 500 was also lower on the day, but pulled off a one point gain on the week, while the Nasdaq ended 0.6% higher for the week.
Globally, the FTSE fell 0.1%, the Nikkei gained 0.1% and the Shanghai Composite added 0.2%.
Eastman Chemical Co. (NYSE:EMN) closed at $66.87 after seeing 1385388 shares trade hands during the most recent session. This represents a change of 0.78% from the opening.
The closing price represents the final price that a stock is traded for on a trading day. It’s the most up-to-date valuation until trading begins again on the next day. However, most financial instruments are traded after hours, which means that the the closing price of a stock might not match the after-hours price. Regardless, closing prices are a useful tool that investors use to quantify changes in stock prices over time. The closing prices are compared day-by-day to look for trends and can measure market sentiment for any security over the course of a trading day.
Stock exchanges work according to the invisible hand of supply and demand, which determines the price where stocks are bought and sold. No trade can occur until someone is willing to sell a stock at a price that another is willing to buy it at. When there are more buyers than sellers, the stock price will rise because of the increased demand. Conversely, if more individuals are selling a stock, the price will decrease.”
A VERY CLEAR ARTICLE EXPLAINING AN ON-GOING MARKET PROCESS BY MEANS OF VISIBLE PRICES.
Every student from ECON 101 understands this. Every participant in a market knows this - they can look at current VISIBLE prices and can make a judgement: do they want to stick or twist (metaphor alert!).
Professional market watchers follow VISIBLE price trends and can follow their clients instructions or can act on their own judgements wthin their skill sets both within or outwith ‘office hours”. Newspapers and emails scan VISIBLE prices to which market investors can choose to act or get somebody else to act for them.
That is how markets work using the VISIBILITY or prices and their possible movements. Even computer programs that track VISIBLE prices and can initiate action or inaction to buy or sell in a market.
There is absolutely no role for the metaphor of “an invisible hand” and Adam Smith wrote nothing to say there was such a real entity at work.
He used the metaphor to help to describe how the motivated actions of a particular merchant (what today we would call his ‘risk aversion’) caused him to invest locally and in doing so he added his capital to ‘domestic revenue and employment’. This consequence of his intentional local investment happened unintentionally to benefit the public good.
Likewise, Smith noted on multiple occasions in his Wealth of Nations how the motivated intentional actions of other merchants could be a disbenefit to the public good, such as when merchants clamoured for the government to restrict imports - even ban them altogether - which intentionally restricted compertition and intentionally raised domestic prices and their profits. And, of course, lowered the profits of other merchants.
Friday, October 21, 2016
ONE STEP FORWARD, TWO STEPS BACK
Editorial in Daily Camera HERE
"Boulder should lead on sugary drinks"
"Sugar, rum, and tobacco are commodities which are nowhere necessaries of life, which are become objects of almost universal consumption, and which are therefore extremely proper subjects of taxation."
—Adam Smith, "The Wealth of Nations," 1776
We borrow the entry quote to today's editorial not only from Adam Smith's seminal economic treatise, but from a 2009 article in the New England Journal of Medicine entitled, "Ounces of Prevention - The Public Policy Case for Taxes on Sugared Beverages."
Adam Smith, of course, was the original free-market economist, the man who coined the expression "Invisible Hand" for the free-market forces created by the individual pursuit of self-interest. It is ironic, therefore, and possibly the latest indictment of our education system, that alleged conservatives today condemn the proposed excise tax on sugary drinks in Boulder as an improper intrusion by government on free choice.
Interesting editorial and link to Adam Smith on taxing sugary drinks.
It is spoiled by linking Adam Smith to a modern version of him ‘coining the expression’ of the ‘invisible hand’. He didn’t, of course. ‘coin’ the metaphor of an “invisble hand’. That metaphor/expression has a much longer history than Smith’s lifetime (for instance, such as by William Shakespeare in MacBeth, and scores of theological instances).
Moreover, individual self-interest could also create import prohibitions, and/or high tariffs, curbing “free-market forces”. Smith’s use more nuanced than the Daily Camera appears to realise - and Adam Smith said so in Wealth of Nations many times.
But congratulations to the Daily Camera editorial for drawing attention to the pontentional taxability of sugary drinks, as a health measure.
Thursday, October 20, 2016
LOONY TUNES no. 181
Jeffrey Snider posts (16 October) on Seeking Alpah HERE
In 1953, Milton Friedman wrote out what have been the guiding principles of modern, orthodox economics that were necessary should it wish to join the ranks of serious science. In his Methodology of Positive Economics, Friedman recognized economics unlike harder sciences proceeds from an enormous disadvantage, meaning that for the most part, all of it is unobservable. We know that an economy happens and that there are observable conditions that relate to the immense and complicated interactions that make up any economic system, but to figure out exactly how A becomes B is all but impossible. You and I may arrive at the same place, economically or financially speaking, but the way in which we did might be extremely different and that might be important.
This was, of course, Adam Smith's "invisible hand" of free market economies where social progress was a product of mutual interdependence. But economists of the post-Great Depression era were concerned that because so much was invisible, leaving it up to markets alone was too messy and far too often violent. Many, like Friedman, were actually concerned that without a more central role for someone (it was only human that economists saw themselves in that role) that free markets altogether would be subsumed by raw statism, as so many other places had already experienced. To them, to save it was to corrupt it.
Kathlen Hartnett White posts (18 October) in WRT Here
Kathleen Hartnett White, distinguished senior fellow-in-residence and director of the Armstrong Center for Energy & the Environment at the Texas Public Policy Foundation and former chairman of the Texas Commission on Environmental Quality. Also co-author of the new book Fueling Freedom: Exposing the Mad War on Energy (Regnery, 2016).
“Determined, free, creative, courageous men and women -- exemplified throughout the Midland community -- have achieved what seven presidents promised but failed to achieve: energy independence as an option. The shale revolution is a result of the Permian rock and the people making thousands of individual decisions in pursuit of profit within a competitive market. It looks like Adam Smith’s “invisible hand” -- the free market -- has also replaced the autocratic bullies of OPEC without so much as a single skirmish. “
Alt_driver (17 October) posts HERE
“It's like watching a giant invisible hand crush an empty soda can”
“Some economists point to Adam Smith’s long-held theory that the invisible hand of the global market place should allow labor and raw materials to move wherever they will be used to maximum benefit. In short, open borders and free trade. That’s the theory.
But in the United States, Smith’s invisible hand is smacking labor upside the head.”
I have a long standing commitment on Lost Legacy to only comment on the politics of the country I vote in (Scotland) and the above quote is from a political column in a USA newspaper. Nothing I assert may be taken as an endorsement or criticism of the politics of Betsy McCaughey or the New York Post. I am solely interested in the demonstrated economic illiteracy regarding Adam Smith’s legacy.
Maitreesh Ghatak posts (20 October) in The Business-Standard HERE
“Oliver Hart and Bengt Holmström, who won the Nobel Prize in Economics (or to be precise, The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel) this year for their work on Contract Theory are part of an important line of research in microeconomics that has patiently tried to open up the black-box of how the economic institutions that underpin that grand abstraction called the “invisible hand of the market” actually works.”
Tuesday, October 18, 2016
LOONY TUNES no 180
Tadeusz Szuba, author of the model for the phenomenon of collective intelligence, (2001) posts (15 October) on Fifty State Banana HERE
‘Computational model of the Invisible hand phenomenon”
Tadeusz Szuba proposed a theory – that Adam Smith’s Invisible Hand metaphor is an occurring phenomenon that can be formalized, simulated and most probably used to propose all-new tools to analyze and predict markets in the future.
The proposed theory claims that the Invisible Hand is a symptom of the existence of another dimension of a market, which is of computational nature. A market and its agents are unaware of this, because only piece(s), or result(s) of this symptom can be observed. In this dimension, the nature of a market and agents creates a complete, programmable computer on the platform of brains of agents and the physical structure of the market. This computer is self-programming and since it exists and functions on the platform of market agents’ brains, results of computations are outputted via the brains of agents and represent themselves as the behavior of a market. These computations are chaotic, distributed, parallel, and non-continuous, with interleaving threads of different computations.
These computations are driven by:
1 abstract value assigned to objects and services
2 calculations and logic inferences.
What is fundamental for the emergence of this computational dimension, is that market agents are able to assign value to objects, services and actions, are able to build in consciously chains of inferences, and are able to convert conclusions into business actions.
According to this theory, the Invisible Hand is much more powerful and universal than Adam Smith and contemporary economists even expected. The Invisible Hand performs market control on several levels: in terms of production and consumption (equilibrium optimization); in terms of new discoveries (technical market optimization); in terms of social behavior (social market optimization), such as modifying and discovering new rules of market behavior. It is expected that this discovery may lead to the creation of all-new tools and models for market analysis and prediction, compared with today’s macroeconomic models.
A leap into ever more complex theory for a phenomenon that does not exists as it is based on a rhetorical metaphor from language, not
from physics or social relationships.
LOONY TUNES no. 179
Michael Tennant posts (14 October) on New American (‘that freedom shall not perish’) HERE
“The fact is that the ACA is both unconstitutional and unworkable. It cannot be successfully reformed because it attempts to substitute central planning for the invisible hand of the free market, as if a handful of politicians and bureaucrats in Washington could possibly micromanage the healthcare of 320 million people to everyone’s satisfaction. Now, as in 2010, the only genuine solution for it is repeal.”
Ben Chu posts (15 September) on The Independent HERE
“The Brexiteers’ Marmite conspiracy theories exposed their utter ignorance of how markets really work”
“Despite the deluge of headlines it generated, there was actually nothing unusual about the process of a supermarket haggling with its supplier over prices
“When we sort ourselves in this instinctive way, the average wait for everyone is lower and customers are processed as efficiently as possible. There’s no need for any complex calculations or centralised co-ordination. By doing what’s right for ourselves we help everyone. This is Adam Smith’s “invisible hand” in action.
And that is how we often conceptualise markets. As consumers we respond to changes in prices and supply responds to shifts in demand. It all happens naturally and fluidly, creating a kind of spontaneous order. Yet, while it is true that markets can sometimes work in that almost magical textbook way, more often than not they don’t.”
Islam Omran (posts 16 Ocftober) HERE
THE INVISIBLE HAND IN THE CLOUD
“The phrase “invisible hand” was coined by Adam Smith in the book ‘The Wealth of Nations’. The theory behind this very popular phrase is that there are unintended social benefits to individual actions. The invisible hand theory has evolved and was turned to public policy formulation as a strategic means for intending social benefit. Balancing control, promoting business interest and ultimately attaining social benefits have been at the forefront of National Development objectives.
The invisible hand, in predominantly the Cloud private sector, has unleashed new possibilities and innovative services, delivering social benefits, creating new markets or disrupting existing industries.”4
Dan Neil posts (17 October) in the Wall Street Journal
“How Aston Martin and Red Bull Racing Reinvented Car Design
But what if road cars were shaped differently? What if, rather than becoming draggy and unstable with speed, family sedans became more stable, the invisible hand of the air pressing them to the tarmac rather than prying them loose?”
LOONY TUNES no. 178
Admin posts (12 October) in INFO-EUROPA HERE
Univision Scolds Conservative Media For Their Conspiracy “Theories About Climate Change”
“In the eyes of some conservative commentators, the invisible hand of liberals operated behind the powerful Hurricane Matthew, a climate phenomenon that triggered a massive evacuation on the east coast of Florida as had not been experienced in over a decade.Limbaugh is right when stating all these, but he skipped one little detail: Hurricane Sandy.Some of Trump’s conservative supporters, though, couldn’t wait to wade in and proffer their “theories” on a devastating weather event they believe is a hoax.”
Barry Bridges posts (11 October) on Newport This Week HERE
“As with his previous run for council in 2014, Lavarre is seeking an overhaul of business regulations. “The key is to reduce limitations, regulations, excessive rules, and taxes. If you reduce the burden on merchants, you’ll have more who will thrive under the invisible hand of capitalism.”
Editorial posted (14 October) in Charleston Gazette-Mail HERE
"Government, after all, is supposed to be “the invisible hand,” not an overlord imposing burdensome regulations that prevent businesses from being successful. A competitive marketplace is nearly as important to free society as democracy itself. Just as we are vigilant in protecting our rights under the Constitution, we also must protect economic competition.
Friday, October 14, 2016
LOONY TUNES no. 178
Tyler Cowen, a Bloomberg View columnist, and professor of economics at George Mason University, posts and writes for the blog Marginal Revolution. His books include “Average Is Over: Powering America Beyond the Age of the Great Stagnation.” posts HERE
Puzzled About Republicans and Trump? Game Theory Helps”
“In “other words, the Republicans have been on the wrong side of game-theory logic twice, first in delaying their opposition and then later in enacting it. Those are hardly examples of getting Adam Smith’s “invisible hand” metaphor to work in their favor.”
THE COLLEGIATE STAFF of Grand Rapids College Student Newspaper posts (11 October) HERE
“Brewster’s, foodies, aspiring game designers, digital animators and chefs have been served by the partnership between FSU and GRCC for 25 years. What the next 25 will bring only the invisible hand of the market will reveal, hopefully no terminators, but if it terminates as well as Art and Bev’s makes a burger I am sure it will be a painless affair.”
Congratulations on your 25 years.
But forget what the “the invisible hand of the market will reveal”. It will reveal nothing. It doesn’t exist. Adam Smith never said it did. Modern economists, like Paul Samuelson, promoted the false idea from misreading Adam Smith from 1948 in the first edition of his highly successful textbook, Economics, and its following 19 editions.
What the market will bring over the bext 25 years is an account of markets based on their VISIBLE prices - no market can work without visible prices - that’s all we need.
Tim Winton posts (14 October) in The Guardian newwspaper
“Tim Winton on class and neoliberalism: 'We're not citizens but economic players”
“…The market doesn’t care about people, Winton argues, and neither is there any genius in it. “There’s no invisible hand,” he says. “And if there is one, it’s scratching its arse. …”
[Note: Tim is an Australian, a country well known for its often robust, if lyrical, use of language.]