The globalisation of financial markets was a market-fundamentalist project, and it made remarkable headway before its shortcomings were exposed. Market fundamentalism is false and dangerous ideology. It is false on at least two counts. First, it profoundly misapprehends the way financial markets operate. It assumes that markets tend toward equilibrium and that equilibrium assures the optimum allocation of resources. Academic economist have proceeded far beyond general equilibrium, multiple equilibriums are all the rage now, but market fundamentalists continue to believe they have solid science behind them, not just economics but also Charles Darwin's theory of survival of the fittest.
Second, by equating private interests with the public interest, market fundamentalism endows the pursuit of self-interest with a moral quality. But if financial markets do not tend toward equilibrium, as the theory of reflexivity maintains, private interests cannot be equated with the public interest. Left to their own devices, financial markets are liable to go to socially disruptive extremes. The fallacy of endowing the market mechanism with moral quality goes deeper still. What distinguishes markets is exactly that they are amoral - that is to say, moral considerations do not find expression in market prices. That is because efficient markets by definition have some many participants that no single one can affect the price. Even if some participants are held back by scruples, others will take their place at only marginally different prices. For instance, moralists cannot prevent alcohol and tobacco companies from raising capital on more or less the same terms as not as not-so-sinful enterprises.
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