Listening to: Fools Gold - The Stone Roses

I found reference to this article in Tim O’Reilly’s tweets. I’m a fan of George Soros… he’s rather successful and wonderfully thoughtful. His thinking about markets and how they behave is always insightful. He stepped it up when commenting on the current situation (my emphasis):

We are currently experiencing the bursting of a credit bubble that has involved the entire financial system and, at the same time, a rise and eventual fall in the price of oil and other commodities that have had some of the characteristics of a bubble. I believe the two phenomena are connected in what I call a super-bubble that has evolved over the last quarter of a century. The fundamental trend in the super-bubble has been the ever-increasing use of leverage—borrowing money to finance consumption and investment—and the misconception about that trend was what I call market fundamentalism, the belief that markets assure the best allocation of resources.

WOW! Read it slowly - that’s George Soros implying that the market is not always the best mechanism for allocating resources.

UPDATE: And it seems the implication is close to reality.

This entry was posted on Saturday, September 6th, 2008 at 8:40 pm and is filed under Rant. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.