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Most of what you've said has been right, concerning the actual modern mechanisms of the invisible hand of the market, however the historic basis you've given for its creation isn't right. Smith never states or hints at all that the modern hand is led by anything but the mass decisions of people making decisions that are best for them at the time. Never does he mention in all 1000+ pages of The Wealth of Nations anything about a deity, in fact in book IV he openly talks about a religion and the clergy as a group that the government should manipulate like any other to make sure they don't impose on peoples reasoning with "superstition". The price of anything, the product of manipulation by the invisible hand, is determined to this day by modern economics in very large part by the exact mechanisms Smith describes: the law of supply (which he says creates a direct relationship between the price of a product and the amount sellers are willing to sell) and the law of demand (which he says creates an inverse relationship between the price of a product and the amount buyers are willing to by).

Furthermore, there is no evidence that Smith believed crime was the worst crime of all. When he states that the creation of the civil government can be attributed to the need for defence of the rich against the poor he makes it abundantly clear that this is true because human nature and greed being what it is creates resentment of those who do not have property against those that do. As such in a society of hunters, where no one has property that cannot be regained within a few days work, there is no need for civil government, because all are relatively financially equal. However, when you arrive at any higher forms of society, like shepherds, husbandmen, or civil society, division of class is created by accumulation of wealth by some. It is not out of disgust of stealing over any other crime that leads him to his stance on the main reason for civil government, but the realization that the law's duty to protect every citizen from every other citizen stems from some citizens having more than others, and it is those ones that need protection more often than those that have nothing.


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