The Non-Existent Hand: How to Save Capitalism
Joseph Stiglitz, 22 April 2010
The present crisis should lay to rest any belief in ‘rational’ markets. The irrationalities evident in mortgage markets, in securitisation, in derivatives and in banking are mind-boggling; our supposed financial wizards have exhibited behaviour which, to use the vernacular, seemed ‘stupid’ even at the time. If we are to design policies to prevent crises or to deal with them when they occur, it is essential to understand the critical flaws in the standard paradigm.
