Gary Becker on the Current Economy, the Cause of the Financial Market Meltdown, and the "Stimulus"

Story here.  Becker argues that the current economic mess is largely due to government meddling in private markets.

I thought this was interesting regarding mark-to-market

How about getting rid of the mark-to-market pricing of bank assets [that is, pricing assets at the current market price] that some say has destroyed bank capital? Mr. Becker says he prefers mark-to-market over "pricing by cost because costs are often completely out of whack with what the real prices are." Then he adds this qualifier: "But when you have a very thin market, you have to be very careful about what it means to mark-to-market. . . . It's a big problem if you literally take mark-to-market in terms of prices continuously based on transactions when there are very few transactions in that market. I am a mark-to-market person but I think you have to do it in a sensible way."

I'm not an expert on mark-to-market, but let me guess what he means.  A market price is a measure of the value of an asset to the marginal buyer.  When the market is big (i.e. there's a lot of transactions), we have a lot of information to go by regarding the value of an asset.  But when the market is small (in terms of the number of transactions) then there is little information regarding what the value is.  Basically, it's seemingly a small sample problem. 

Suppose there is one Honus Wagner baseball card in existence and it is traded 3 times.  The first transaction is for $10,000, the second transaction is for $15,000 and the third transaction is for $100,000.  There's quite a spread in these numbers.  What is most representative of the true market value: the average price ($38,333), the last price ($100,000), the median price ($15,000)?