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in a strict sense, all markets guaranteed by the government of a single state are faith-based, given the market-as-it-exists is dependent on the state for enfor
by athriren 6y ago
in a strict sense, all markets guaranteed by the government of a single state are faith-based, given the market-as-it-exists is dependent on the state for enforcement of laws and as a guarantor of some basic standards allowing for the market to function.
- pmiller2 6y agoExactly. Currency markets are kind of the ultimate in this sort of “faith-based” market.
- mjburgess 6y agowell the institution of the market relies upon the institution of the gov, and is "based" in this sense not on "faith" -- but on the monopoly of violence of the state to enforce the laws which enable market activity the sense of "based" relevant to market behaviour, though, is whether buy/sell/etc. activity (ie., trader actions) is based on faith or not -- and it is largely, not each action is the result of an evidenced-belief, and as the quality of the evidence improves, and spreads, the market changes. It is (inefficiently) responsive to evidence, rather than based in faith.
- athriren 6y agothe faith every agent in the market demonstrates in the market is that the market itself will not collapse as a result of the behavior (or sudden non-existence) of the state. faith and “evidence based belief” are perhaps more entangled in my head than yours, though. my only point is that at some point each actor comes to the conclusion that they have enough information, that this information is predictive, and that the future is comprehensible. it is impossible to know future outcomes, so on some level every best-judgment action people take in a market demonstrates this baseline “faith”.