Letters to the Editor
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The Big Players Will Rig The System
I think the fatal flaw of those who preach unfettered capitalism and free markets is that they somehow think that entrenched players will not protect their interests. I'm a big believer in capitalism and free markets, but I also recognize that the Government has important role to play to make sure that those in positions of power do not abuse that power to retain that power. Without government intervention, most industries would be monopolies. While I have yet to make up mind if the Bear Stearns bailout is warranted or not, the Government has a role to play to stabilize the financial markets for the benefit of society. Yes, there are lesson to be learned, but as Keynes said "in the long run we're dead." Banks are not like other companies, and especially big ones. They are too closely linked to the Fed in the creation of money.
I know there those who would argue for the elimination of the Fed and the role of money creation from the Government entirely. Who would fill that void? A private bank? And there we once again run into a problem where one big player is likely dominate and exercise market power.