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armchair,

I will not say "letting private actors make those decisions based on market forces" is the best in any country in any circumstances but what you have said ("Free market forces with absolutely no regulation led to the collapse of their economy and dragged down the rest of the world") is not quite true.

What happened in USA is a large central bank (FED) artificially played with the price (interest rate) of one of the most important commodities in the world (money, USD) to avert a relatively mild recession (2001 dot com bubble and 11/9). A small group of people led by Alan Greenspan decided what interest rates should be and against market forces they lowered it to zero.

Second, the problem was not "lack of regulation" but "lack of risk". In a free market, "probability of loss" naturally regulates the "desire to take risk". Risk in money is usually reflected in interest rates. When Alan Greenspan and his team lowered interest rate to "zero" levels, they effectively destroyed natural regulation through "risk" because they transferred the risk from borrowers/lenders to the shoulders of tax payers including savers (currently we are witnessing the realization of promised risk transfer, risk takers are bailed out by tax payers).