When we say "free market" we mean a market that is free from "government interference", which is a pretty loaded term if you think about it. If pressed, most people will soften it to "undue government interference". (I'm not talking about the market down the street, I'm talking about big commercial markets as a broad category.) However, markets benefit from government help all the time. In our culture, we have defined such help as "enforcing the natural order" or "creating an even playing field". If you drill down enough you will see that markets exist in context defined by the state. They cannot exist without certain things provided by the state. Specifically, property rights and currency regulation. A good metaphor is a bateria growing in a petri dish. The property rights and currency regulation are the "growth medium" that allows markets to develop and expand. Within the United States, it's easy to take such things for granted because they are relatively stable, but it's easier to see this dependency when you look at international trade. Because government structures operate between nations only based on treaties or trade agreements, which are always open to lax enforcement or renegotiation. There was a time when the Chinese government didn't care so much about IP rights. They didn't see that it counted as an important form of "property." So at that time I could go to China and buy all the unlicensed Hollywood movies I wanted for little more than the cost of the plastic they were printed on. At some point American companies said "that's a violation of our property rights!" (American property rights, not Chinese property rights, but that's the quiet part people don't say out loud.) So there was a trade negotiation of some kind and China started to enforce the same kind of "property rights" that the western world was expecting. If you have a stock exchange that's denominated in pesos of a south american country, and those pesos start to suffer from 50% annual inflation, all the companies are going to decide they'd rather be listed someplace else (with a currency that is guaranteed to be stable by the country that issues the currency). When wall street defines a new financial instrument as a bet on whether some other stock goes up or down, we call that a "derivative." The value of the derivative is based on the behavior of the underlying stock. In this sense all markets are "derivatives" of one or more states. The default currency of the market creates a derivative relationship on the issuing nation. In terms of property rights, a stock is derivative on the property rights of the states where they do business. For international markets it gets fuzzier, because the enforcement of property rights will come from which ever state has 1) the *ability* to enforce it's idea of property, and 2) the *willingness* to do so. In general, enforcing property rights in international trade happens when a country has a strong financial interest to do so, responding to the desires of the companies with influence in the host(1) country. (1) Think of "host" as in chest-burster, not "host" as in dinner party.