Doh!

by Don Boudreaux on September 19, 2008

in Current Affairs, Prices, Reality Is Not Optional, Regulation

Let no one accuse
politicians and bureaucrats of lacking Homeric courage.  When prices
change in ways that disturb the electorate – whether it be gasoline
prices rising or corporate share prices falling – the political class
springs into action against prices that dare to truthfully reflect
less-than-rosy underlying realities.

Like Homer Simpson who
routinely deals with problems by closing his eyes and pretending that
what he no longer sees no longer exists, government efforts to stop or
modify price movements – such as the SEC’s unprecedented ban on
short-selling
– merely blind markets to reality.  The result is immediate
relief from unpleasant sights, followed by uncomprehending and harmful
stumbling in the resulting darkness.

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