In the model with rational expectations, the optimal policy is laissez faire.It is left as an act of faith, that the correct blood sacrifice to the True Sky God will provide the unequivocal proof about 'rational expectations'.
In the model with efficient markets but without rational expectations it would be preferable to ban gambling--to impose a 100% tax on net trading profits, and redistribute the proceeds (if any).</ii>
[ cf Rational Expectations, Efficient Markets, and Economic Welfare ]
You know, it is interesting how these sorts of 'slippery slope' problems keep croping up - I mean, what if we allowed various forms of state sponsored gambling - it is not like we would create a massive welfare state in the middle of the ashes of the economy as it craters from the full on fiasco, where the rational expectations of the efficient market, as manifested by the unregulated hedge fund gamers would merely go BatShitCrazy!!!
Noe Would It????
So yes, boys and NonPerkin - please remind me about the problems of 'crazy talk' in our post surrealist america?
OR is this REALLY a bad time to talk about the core problems of actual economics in a world where far too many of the americans have DICK ALL knowledge about the delta between money and currency and are damn proud that they live in an america where getting bogged down in mere factualism is the preserve of those elitist intellectual victims of the reality based community.