LOONY TUNES no. 165

1

Roger Lowenstein posts (25 August) on FORTUNE HERE 

“Here's Why the Pundits Are Wrong About Warren Buffett”

“If you believe in Adam Smith—and The Economist has, ever since 

James Wilson, a Scottish hat-maker and proponent of free trade 

and other liberal ideas, founded the magazine in 1843—allocating 

capital is a job that is best performed by the market. Thanks to the 

workings of the Invisible Hand, society is served when investors 

deploy their funds where they envision a high return at reasonable 

risk. Buffett has been doing it for six decades (he started in the 

1950s, with his own investment partnership, before gaining control 

of Berkshire).

COMMENT

The theme of the article in FORTUNE is that Warren Buffet, a talented individual, is an outstanding player in the real markets and from his results he is way ahead of the market rivals. Yet at the same time the article embraces the ‘invisble hand’ as the hidden player in the same market though its results are not as good as Buffet’s over the 60 years he has been operating! 

Something is wrong here. There is no such invisible hand. It is a misreading of Smith by modern economists, starting with Paul Samuelson in 1948.

2

Lara Zarum posts (25 August) on Flavorwire  HERE 

“Trendspotting: Everyone is Terrible and Everyone will Die”

“Sometimes I dream of saving the world,” Elliot confides in voiceover in the first season. “The one with the invisible hand. The one that brands us with an employee badge. The one that forces us to work for them. The one that controls us every day without us knowing it. But I can’t stop it. I’m not that special.”

3

Lizeka Tandwa posts (25 August) on News24 (breaking news first) HERE

“Don’t get drawn into political battles, Cosatu warns Hawks”

“The trade union federation was concerned that the accusations being levelled against Gordhan would affect the market, and thus workers, negatively. An "invisible hand" was behind the allegations against Gordhan. "The impact of all this will affect workers in a negative way. There is almost nothing we can do with an invisible hand and the market," Dlamini said.