For those of us who have studied economics, they will be familiar with the guru Adam Smith. The father of economics, had a vision which seems to persist to the present day and influences government policy. Known as "the invisible hand" Adam Smith put all his faith in the virtue of a mystical force that would guide the economy for the good of everybody if only governments would not interfere. Hence the "invisible hand" became the credo for the free market economy. Even after the Great Crash of 1930 and the lessons of Keynesian economic policy were learn't, economists still held on the the notion of the "invisible hand" much like a religious follower will believe in the holy spirit despite the absence of any proof.
With the meltdown of the US economy occurring because of the poor performance of banking sector, we are faced with the need to re-evaluate the notion of the free market and the idea of the invisible hand.
The world will now have to wait for the emergence of a new economics guru who will explain to us what is happening and where we went wrong. Until then, we are bound to suffer the consequences of international economic meltdown.
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