Greenspan believed that honest CEOs will prevent any material corporate fraud. Further, there is no serious problem because markets force CEOs to act as if they were honest since a good reputation is essential to the CEO. Under laissez faire, "frauds" had to adhere to a more ethical standard in their market transactions, or they risked being driven out of business (i.e., free markets correct).

Or in more simple terms, CEOs are virtuous, and a CEO who deviates from the ethical standard will be put out of business as markets correct. As a result, fraud need not be policed.

It turns out that Greenspan's blind spot was that unethical frauds would choose to collude and place their own avarice above the viability of their business.

They never understood their own model.

Seriously.

...squarely at the feet of "free market" Libertarians (Republicans will suffice) by explaining to Americans an uncomplicated and easy to understand fact about libertarianism: a global economic meltdown is, in fact, a predictable outcome of a global economic libertarian model. This is what libertarians call "markets correcting themselves." And when markets correct in a global libertarian model, people lose their savings, their jobs, and their homes. And when people lose their savings, their jobs, and their homes, the economy remains on the precipice of depression for years. Libertarians naively believed that this function of "free markets" was an inherent good of a model they simply didn't understand and have since abandoned as quickly as they could by blaming the depression on Democrats and President Obama when it was they who, in fact, were the architects of the model.