This commentary is enlightening and suggests that there is no direct ‘pill for the ill.’ As to scientific discovery in the pursuit of knowledge is ever evolving, so is the evolution of financial theory, tools, and market pricing.

While grounded in ‘free-market-principles’ in setting prices, there is one caveat worth noting here – especially in light of the commentary statement “the only workable solution is prices set by free markets”. This theory is grounded in ‘utility theory.’ The presumption under “utility theory” is that market participants only seek to maximize their wealth for a given level of risk. Yet this is hardly true in reality.

While there is much to be said about this from the behavioral finance perspective (i.e. behavioral bias to emotional intelligence), the discoveries in neuroscience blended with human behavior is much more enlightening (i.e. cognitive brain function- unhealthy stress cortisol releases vs gratitude/giving happy hormonal releases), and thus helpful to where financial theory needs to explore.

This influences pricing and valuations as financial tools. AND, this is quite NOT the ‘communist’ or ‘socialist’ manifesto, but blending the knowledge from science with finance to create better financial tools that reflect the sustainable functioning future of society. Quite frankly, humanity was given two sides of the brain and our design is not to operate under just one side – presumably how ‘utility theory’ denotes. Ignoring this also ignores a distortion in finance theory. (Check out Robert Shiller and John Coates to name a few).

Often, in discussion with finance folks, the conversation begins with acknowledging these misgivings of finance theory and then circles back to the status quo. For the most part markets work efficiently as argued, yet we can always improve upon our tool box by being open to new ideas from multiple perspectives that work towards resolving the misgivings of finance theory.

This is the challenge we need to embrace – thanks all for sharing your perspective.