For hundreds of years people have been extolling the virtues of knowledge and transparency in the markets. Here’s what they had to say:
“I believe that market transparency, fairness, and integrity are key to the strength of our marketplace" William H. Donaldson, Current SEC Chairman
“Education is a win-win for both investors and the industry. Remember those advertisements? A well-informed customer is a good customer. A smarter investor is less likely to fall prey to unethical brokers and should be better able to appreciate the risks associated with certain investment vehicles.”
Paul S. Atkins, Current SEC Commissioner (Remarks before The Securities Industry Association, Orlando, Florida, April 7, 2003)
“To approve of another man's opinions is to adopt those opinions, and to adopt them is to approve of them. If the same arguments which convince you convince me likewise, I necessarily approve of your conviction; and if they do not, I necessarily disapprove of it: neither can I possibly conceive that I should do the one without the other. To approve or disapprove, therefore, of the opinions of others is acknowledged, by every body, to mean no more than to observe their agreement or disagreement with our own. But this is equally the case with regard to our approbation or disapprobation of the sentiments or passions of others…
Every faculty in one man is the measure by which he judges of the like faculty in another. I judge of your sight by my sight, of your ear by my ear, of your reason by my reason, of your resentment by my resentment, of your love by my love. I neither have, nor can have, any other way of judging about them…”
Adam Smith, The Theory of the Moral Sentiments (1759)
When the quantity brought to market exceeds the effectual demand, it cannot be all sold to those who are willing to pay the whole value of the rent, wages, and profit, which must be paid in order to bring it thither. Some part must be sold to those who are willing to pay less, and the low price which they give for it must reduce the price of the whole. The market price will sink more or less below the natural price, according as the greatness of the excess increases more or less the competition of the sellers, or according as it happens to be more or less important to them to get immediately rid of the commodity.
When by an increase in the effectual demand, the market price of some particular commodity happens to rise a good deal above the natural price, those who employ their stocks in supplying that market are generally careful to conceal this change. If it was commonly known, their great profit would tempt so many new rivals to employ their stocks in the same way that, the effectual demand being fully supplied, the market price would soon be reduced to the natural price, and perhaps for some time even below it. If the market is at a great distance from the residence of those who supply it, they may sometimes be able to keep the secret for several years together, and may so long enjoy their extraordinary profits without any new rivals. Secrets of this kind, however, it must be acknowledged, can seldom be long kept; and the extraordinary profit can last very little longer than they are kept.
Adam Smith, The Wealth of Nations (1776)
“There are many classes of things the need for which on the part of any individual is inconstant, fitful, and irregular. There can be no list of individual demand prices for wedding-cakes, or the services of an expert surgeon. But the economist has little concern with particular incidents in the lives of individuals. He studies rather "the course of action that may be expected under certain conditions from the members of an industrial group," in so far as the motives of that action are measurable by a money price; and in these broad results the variety and the fickleness of individual action are merged in the comparatively regular aggregate of the action of many…
…If a sufficient number of tables of demand by different sections of society could be obtained, they would afford the means of estimating indirectly the variations in total demand that would result from extreme variations in price, and thus attaining an end which is inaccessible by any other route. For, as a general rule, the price of a commodity fluctuates within but narrow limits; and therefore statistics afford us no direct means of guessing what the consumption of it would be, if its price were either fivefold or a fifth part of what it actually is…
…It is only by thus piecing together fragmentary laws of demand that we can hope to get any approach to an accurate law relating to widely different prices. (That is to say, the general demand curve for a commodity cannot be drawn with confidence except in the immediate neighbourhood of the current price, until we are able to piece it together out of the fragmentary demand curves of different classes of society)”…
Alfred Marshall, Principles of Economics (1890)
...The capacities to infer underlying information from the behavior of others is so commonplace that we hardly notice the complex process that is taking place. When searching for a restaurant in an unfamiliar area, people typically look to see where many others are eating. If one stands and looks into a store window, those passing on the sidewalk will frequently pause to look also. When judging the quality of movies, both the number of favorable reviews as well as the reported ticket sales figure into an otherwise uninformed decision. The odds at horse races or the Las Vegas point spreads on ball games are frequently good predictors of winners. In fact, when these variables are used in models, they leave very little for other variables to explain. The odds and point spreads are not made by a single mind but instead are the product of many interdependent minds competing for an advantage. These examples illustrate the ability of humans to infer subtle information from systemic properties and suggest that such inferences might be commonplace...
Charles R. Plott, Edward S. Harkness Professor of Economics and Political Science, Cal Tech Markets as Information Gathering Tools (Southern Economic Journal 2000, 67(1), 1-15)
"It is important to us to have a fair process for our IPO that is inclusive of both small and large investors. It is also crucial that we achieve a good outcome for Google and its current shareholders" The co-founders also wrote: "Our goal is to have a share price that reflects a fair market valuation of Google and that moves rationally based on changes in our business and the stock market."
Larry Page and Sergey Brin Co-Founders and Co-Presidents of Google (2004)
"We simply try to make it easy and transparent, lay out a few rules, and get the heck out of the way."
Margaret (“Meg”) C. Whitman, CEO, eBay (Business Week, Sept 29, 2003)