FREE MARKET ECONOMY - the only answer ?

Professor Milton Friedman, IMHO, was one of the visionaries of economy.

Check out this article by Holcomb Noble in New York Times.com

" Conservative and liberal colleagues alike viewed Mr. Friedman, a Nobel prize laureate, as one of the 20th century’s leading economic scholars, on a par with giants like John Maynard Keynes and Paul Samuelson.

Flying the flag of economic conservatism, Mr. Friedman led the postwar challenge to the hallowed theories of Lord Keynes, the British economist who maintained that governments had
a duty to help capitalistic economies through periods of recession and to prevent boom times from exploding into high inflation.

In Professor Friedman’s view, government had the opposite obligation: to keep its hands off the economy, to let the free market do its work. He was a spiritual heir to Adam Smith, the 18th-century founder of the science of economics and proponent of laissez-faire: that government governs best which governs least.

The only economic lever that Mr. Friedman would allow government to use was the one that controlled the supply of money — a monetarist view that had gone out of favor when he embraced it in the 1950s. He went on to record a signal achievement, predicting the unprecedented combination of rising unemployment and rising inflation that came to be called stagflation. His work earned him the Nobel Memorial Prize in Economic Science in 1976."

My personal opinion : Friedman's dream / theory is COMING TRUE. Of course, there will be recessions and booms.

Isn't LIFE ITSELF FULL OF UPS AND DOWNS ?

But markets can flourish ONLY IN TRUE DEMOCRACY....

EMERGING MARKETS ..... reason behind their high returns

This basically started from the 1990 middle. Capital started shifting from developed countries to Emerging Markets .

This in turn FED THE GROWTH OF THEIR INDUSTRIES, THEIR INFRASTRUCTURE.

The main reason behind all this was the MASSIVE PRICE CUT IN TELECOMMUNICATIONS.

Think 'bout it.

It ain't no coincidence that the Emerging Markets started giving good returns after:

• Drop in price of phone calls
• Mushrooming of call centers and back office operations.
• Interexchange of IDEAS.
• Cut in Internet prices globally.
• Global access to all the markets throughout the world.

What did I tell ya? .....OIL TRADING AT $112 / BARREL !

Current events have thrown the markets in a STATE OF FLUX.

Some people are just TRADING IN HIGH VOLUMES IN OIL, OIL AND ONLY OIL .....making a killing in the process.

It may not last long.

Check this from reuters.com :

"LONDON (Reuters) - Oil rose to a record near $112 on Monday as a surprise weekend cut in the Federal Reserve discount rate and the sale of stricken U.S. investment bank Bear Stearns ( sent the dollar to all-time lows.

U.S. crude for April hit a fresh high of $111.80 a barrel. It was trading $1.15 up at $111.36 a barrel by 5:15 a.m. EDT.

May London Brent crude was $1.28 higher at $107.48.

"The recent oil prices have been swayed by the currency moves, including this latest rally to a record," said Tony Nunan, risk management executive at Tokyo-based Mitsubishi. "The dollar weakness is the factor at the moment."

The dollar plunged across the board on Monday as the spiraling U.S. financial crisis led to JPMorgan Chase acquiring Bear Stearns, stirring fears that more financial firms may become casualties."

High volume traders have bought into oil at large quantities at $60 / barrel and selling them now....making a profit of around 90 - 100 % in 8 months !

Now, since I'm just a poor analyst blogger and a consumer , I'm not amused.

But you may be.....'cuz you have

DOUBLED YOUR MONEY IN 8 MONTHS !