Wall Street: How good of an approximation for market-based capitalism?

Four months ago I challenged the LinkedIn community with a topic titled "Survival of Capitalism." Last week, one of my LinkedIn connections asked the question "Is capitalism dead?"

Needless to say, within the time between these two almost identical questions, the answers have taken quite different paths. Here's what I've learned myself, or how I replied to the second question:

There is a useful distinction between capitalism and free markets as illustrated by Arrighi and others. According to Arrighi, the US form of capitalism entered its final stage in the 1970s. Moreover, capitalism does not die, it just goes to live in another country, with better/more accommodating systems.

At this point in time, increasingly, the answer to your question is in the hands of the US creditor(s). They'll have an increasing say in how the capitalism evolves from here on.

On the other hand, I raised a very similar question to yours, about 4 months ago. I was not aware at that time of the distinction between capitalism and free markets, yet I felt there was something rotten in capitalism. Worth reading are all the answers at that time--see also the implicit "socialist" cries from folks in very regulated industries....

As I've been writing about markets and their actors for some time, allow me to reference the following: Wall Street: How good of an approximation it makes? ... for market-based capitalism?

Wall Street: How good of an approximation it makes?

... for market-based capitalism?

Hence, how sound is it to rely on Wall Street to sort out most society decision-making needs--from pensions to child-care, from environment to efficient allocation of resources, from war to peace?

Yes, this was another LinkedIn question, and the argument went as following:

The Great Depression also resulted in a series of regulations and institutions that have been held responsible for many an ensuing development--ranging from the WWII to a progressive and modern society/state. After the Cold War, especially during Clinton's/Rubin's time, many of the post-Depression era regulations had come undone. The new idea in town has been "self regulation" of the private actors. In the light of the several bailouts, critics of "self regulation" say that in fact we only socialized loss and privatized gain. In the light of the ever renewed debate, triggered by the sub-prime events, loss of pension and health-care benefits through bankruptcy, and the '08 elections' messages, an evaluation of all previous assumptions and statements is as timely as ever. So, what do you think, is self-regulation the way to go, assuming that market capitalism is here to stay?

For other perspectives, follow this link.