Has the market system failed?

Don Boudreaux says no:

It's become an article of faith among lots of people that recent events prove (or at least suggest) that markets don't work very well.....

The vast majority of market exchanges and relationships work smoothly and to the advantage of all participants. Indeed, the market works so well and so consistently that it creates ever-higher expectations among the broad populace. When these expectations are dashed, if only for a handful of persons and if only rarely, the market is deemed to have failed.

But despite the current downturn, the market continues to work well in its typical silence. Do you have trouble today finding gasoline to buy? Are your local supermarket's shelves not stocked with food, wine, and (watch for it soon!) Easter candy? If your cat eats your socks, will you have trouble buying several new pair? If your car's battery dies this afternoon, must you resort to bicycling or public transportation because you can't replace your dead battery? If you're bored this evening with nothing to do, is there no movie you can go to or no DVD you can rent? If you miss your mom in Minneapolis or your boyfriend in Boston, can you not call them on your cell-phone — or even buy a plane ticket and go visit them?

What do you think? Has the market system failed? Why or why not? What specific characteristic has failed? What is the market system's greatest strength? Its greatest weakness? In what ways might the market system need government involvement?