1. When Adam Smith talked about "the invisible hand" he argued that sellers and buyers:

1. Are incapable of reaching agreements, thus price ceilings and floors are necessary.
2. Will push prices to a point were both fairness and efficiency are achieved.
3. Lead prices towards an "end" which neither party is totally happy with, thus government interference in markets becomes necessary.
4. Create mutually agreed upon prices over time, if the market is free of outside interference.
5. Tend to face transactions costs that make it difficult for supply and demand to intersect.