You may not be interested in finance, to paraphrase Trotsky, but finance is interested in you, Mencius Moldbug notes:
1. We do not have a free-market financial system.
2. We have never had a free-market financial system.
3. Leaving the financial system to “work things out on its own” will not produce a free-market financial system. It will produce a smoking heap of rubble.
4. Paulson’s bailout is, if anything, far too weak. Our financial system is part of the government. The proper first step is to stop lying about this. This means nationalizing the banks. This is not an expansion of government, but a recognition of its actual size. It is not an expenditure, but a revision of accounting to reflect reality.
5. A free-market financial system would be way cool. More important, it would be extremely stable. But the only way to create one is to build it right from the start. If you have a car and you want a motorcycle, sell your car and buy a motorcycle. Don’t decide to call your car a “four-wheeled motorcycle,” and don’t think unscrewing two of the wheels will solve the problem.
6. Therefore, the government should close down the financial system we have now and replace it with one that doesn’t suck. What is the probability that this will happen? Zero. But at least you know.