For John, BLUF: Price is a signal and people adjust. Nothing to see here; just move along.
From USA Today, Sunday, we have Law Professor Glenn Harlan Reynolds suggesting "Fast moving bad news builds prosperity". The sub-headline is "Free markets automatically create and transmit negative information, while socialism hides it."
Nassim Nicholas Taleb recently tweeted: "The free-market system lets you notice the flaws and hides its benefits. All other systems hide the flaws and show the benefits.”Well, there is more at the link, but that is the basic story.
This drew a response: "The most valuable property of the price mechanism is as a reliable mechanism for delivering bad news." These two statements explain a lot about why socialist systems fail pretty much everywhere but get pretty good press, while capitalism has delivered a truly astounding results but is constantly besieged by detractors.
Hat tip to the InstaPundit.
Regards — Cliff