James Surowiecki Quotes & Sayings

The financial crisis of 2008 was not caused by investment banks betting against the housing market in 2007. It was caused by the fact that too few investors - including all of the big investment banks - bet too heavily on the housing market in the years before 2007. — James Surowiecki

Congressional Republicans themselves have vehemently defended the idea that preexisting conditions should not be used to deny people insurance. — James Surowiecki

Critics of consumer capitalism like to think that consumers are manipulated and controlled by those who seek to sell them things, but for the most part it's the other way around: companies must make what consumers want and deliver it at the lowest possible price. — James Surowiecki

The essence of procrastination lies in not doing what you think you should be doing, a mental contortion that surely accounts for the great psychic toll the habit takes on people. This is the perplexing thing about procrastination: although it seems to involve avoiding unpleasant tasks, indulging in it generally doesn't make people happy. — James Surowiecki

Businesses that have gone through an episode of hyperinflation become understandably alert to the threat of it: at the first hint of inflation, they're likely to increase prices, since they've learned that if they don't, and inflation hits, their businesses will be wrecked. — James Surowiecki

In part because individual judgement is not accurate enough or consistent enough, cognitive diversity is essential to good decision making. — James Surowiecki

Being out of a job can erode people's confidence and their sense of possibility; and employers, often unfairly, tend to take long-term unemployment as a signal that something is wrong. — James Surowiecki

Downsizing itself is an inevitable part of any creatively destructive economy. — James Surowiecki

If someone really wants my company's business, why shouldn't he be able to do everything he can - including paying me off - to get that business? Because bribery encourages people to make decisions based on the wrong criteria, which means in the business world that it distorts the efficient allocation of resources. — James Surowiecki

In the business world, bad news is usually good news - for somebody else. — James Surowiecki

By the time of the '90s boom, CEOs had become superheroes, accorded celebrity treatment and followed with a kind of slavish scrutiny that Alfred P. Sloan could never have imagined. — James Surowiecki

Academics, who work for long periods in a self-directed fashion, may be especially prone to putting things off: surveys suggest that the vast majority of college students procrastinate, and articles in the literature of procrastination often allude to the author's own problems with finishing the piece. — James Surowiecki

Capitalism, after all, is no fun when real failure becomes a possibility. — James Surowiecki

Making loans and fighting poverty are normally two of the least glamorous pursuits around, but put the two together and you have an economic innovation that has become not just popular but downright chic. The innovation - microfinance - involves making small loans to poor entrepreneurs, usually in developing countries. — James Surowiecki

Tough times have always lent themselves to nativist sentiments and closed-door policies. But in the case of highly skilled immigrants, these policies are a recipe for stagnation. — James Surowiecki

Older people do a better job of managing their impulses, and so they're better able to put off putting off. — James Surowiecki

For most Americans, work is central to their experience of the world, and the corporation is one of the fundamental institutions of American life, with an enormous impact, for good and ill, on how we live, think, and feel. — James Surowiecki

In order to work well, markets need a basic level of trust. — James Surowiecki

Since the Protestant majority in Northern Ireland wants to remain a part of Great Britain, and since Ireland itself has shown little interest in reunification, the IRA's prospects for success through political channels have always been limited. — James Surowiecki

Most corporate name changes are the result of mergers and acquisitions. But these tend to be unimaginative. — James Surowiecki

Breaking tasks down into smaller sub-tasks can be very useful. — James Surowiecki

Markets work best when there's lots of information available and a historical track record to go on; they excel at predicting things like horse races, election outcomes, and box-office results. But they're bad at predicting things like who will be the next Supreme Court nominee, as that depends on the whim of the president. — James Surowiecki

The desire for reinvention seems to arise most often when companies hear the siren call of synergy and start to expand beyond their core businesses. — James Surowiecki

The ban on sports betting does exactly what Prohibition did. It makes criminals rich. — James Surowiecki

The fact that cognitive diversity matters does not mean that if you assemble a group of diverse but thoroughly uninformed people, their collective wisdom will be smarter than an expert's. But if you can assemble a diverse group of people who possess varying degrees of knowledge and insight, you're better off entrusting it with major decisions rather than leaving them in the hands of one or two people, no matter how smart those people are. — James Surowiecki

The Internet has become a remarkable fount of economic and social innovation largely because it's been an archetypal level playing field, on which even sites with little or no money behind them - blogs, say, or Wikipedia - can become influential. — James Surowiecki

Movies' mistrust of capitalism is almost as old as the medium itself. — James Surowiecki

In American politics, 'Europe' is usually a code word for 'big government.' — James Surowiecki

If you work for Google or Apple, stock options give you a chance to share in the increasing value of the company. In the N.F.L., nothing like this happens; the players, though rich, are just working stiffs like the rest of us. — James Surowiecki

Intellectual-property rules are clearly necessary to spur innovation: if every invention could be stolen, or every new drug immediately copied, few people would invest in innovation. But too much protection can strangle competition and can limit what economists call 'incremental innovation' - innovations that build, in some way, on others. — James Surowiecki

Instead of mindlessly tossing billions at or taking billions from the Net as such, investors should be spending their time making sure that it's the future Fords and General Motors of cyberspace that are getting the capital they need. — James Surowiecki

Speculators get a bad rap. In the popular imagination they're greedy, heedless, and amoral, adept at price manipulations and dirty tricks. In reality, they often play a key role in making markets run smoothly. — James Surowiecki

Most of the work on multitasking suggests that it generally makes you less efficient, not more. — James Surowiecki

Companies often become victims of their own mythologies. — James Surowiecki

The oil market is especially sensitive even to a hint of expansion or contraction in supply. — James Surowiecki

Meeting external deadlines is much harder than meeting internal ones. On the other hand, internal deadlines sometimes don't feel real, and are therefore easy to evade. — James Surowiecki

If private-equity firms are as good at remaking companies as they claim, they don't need tax loopholes to make money. — James Surowiecki

What corporations fear is the phenomenon now known, rather inelegantly, as 'commoditization.' What the term means is simply the conversion of the market for a given product into a commodity market, which is characterized by declining prices and profit margins, increasing competition, and lowered barriers to entry. — James Surowiecki

The value of a currency is, ultimately, what someone will give you for it - whether in food, fuel, assets, or labor. And that's always and everywhere a subjective decision. — James Surowiecki

There does seem to be some evidence that as people get older, they procrastinate less, perhaps because they feel the pressure of time more. — James Surowiecki

Lower oil prices won't, by themselves, topple the mullahs in Iran. But it's significant that, historically, when oil prices have been low, Iranian reformers have been ascendant and radicals relatively subdued, and vice versa when prices have been high. — James Surowiecki

The U.S. is excellent at importing cheap products from the rest of the world. Let's try importing some human capital instead. — James Surowiecki

The important thing about groupthink is that it works not so much by censoring dissent as by making dissent seem somehow improbable. — James Surowiecki

If being the biggest company was a guarantee of success, we'd all be using IBM computers and driving GM cars. — James Surowiecki

Republicans like to indict Democrats as anti-corporate zealots. — James Surowiecki

Of course, presidents are always blamed or rewarded for the state of the economy. — James Surowiecki

The fact that industries wax and wane is a reality of any economic system that wants to remain dynamic and responsive to people's changing tastes. — James Surowiecki

When all is said and done, cheap gas is an illusion, because our reliance on gas creates a whole series of costs that aren't factored in to the pump price - among them congestion, pollution, and increased risk of accidents. — James Surowiecki

Of course, plenty of people don't think that guaranteeing affordable health insurance is a core responsibility of government. — James Surowiecki

The fundamental problem with banks is what it's always been: they're in the business of banking, and banking, whether plain vanilla or incredibly sophisticated, is inherently risky. — James Surowiecki

As technology improves, on-screen avatars look more and more like real people. When they start looking too real, though, we pull away. These almost-humans aren't quite right; they look creepy, like zombies. — James Surowiecki

Of course, politicians always say they're just describing their opponents' positions, even if they are in fact offering absurd caricatures, if not outright lies. — James Surowiecki

Groups that are too much alike find it harder to keep learning, because each member is bringing less and less new information to the table. Homogeneous groups are great at doing what they do well, but they become progressively less able to investigate alternatives. — James Surowiecki

There are certainly valid reasons for taking a company private, and it's also possible that C.E.O.s perform better when monitored by a small number of owners in a private company rather than by the dispersed and often uninterested shareholders of a public corporation. — James Surowiecki

The truth is that the United States doesn't need, and shouldn't have, a debt ceiling. Every other democratic country, with the exception of Denmark, does fine without one. — James Surowiecki

The history of the Internet is, in part, a series of opportunities missed: the major record labels let Apple take over the digital-music business; Blockbuster refused to buy Netflix for a mere fifty million dollars; Excite turned down the chance to acquire Google for less than a million dollars. — James Surowiecki

What an economy really wants, after all, is not more investment per se but better investment. It wants capital to flow to companies that will create value - not in the form of a rising stock price but in the form of more goods for less cost, more jobs, and rising wages - by enhancing productivity. — James Surowiecki

The business of America shouldn't be subsidizing business. — James Surowiecki

Workers who come to the U.S. see their wages and their standard of living boosted sharply simply by crossing the border. That's a good thing, and one of the best arguments for immigration reform, even if you'll rarely hear a politician make it. — James Surowiecki

The stock market has an insidious effect on C.E.O.s' moods, because of its impact not just on their companies but on their own bank accounts. — James Surowiecki

Patrimonial capitalism's legacy is that many people see reform as a euphemism for corruption and self-dealing. — James Surowiecki

Sometimes even a smart crowd will make a mistake. — James Surowiecki

Groups are only smart when there is a balance between the information that everyone in the group shares and the information that each of the members of the group holds privately. It's the combination of all those pieces of independent information, some of them right, some of the wrong, that keeps the group wise. — James Surowiecki

Unlike fuel-economy standards, the most common method of reducing demand for oil over the past thirty years, a gas tax doesn't tell people what kind of car to drive. It simply raises the price of gasoline and lets people adjust their behavior accordingly. — James Surowiecki

For a crowd to be smart, the people in it need to be not only diverse in their perspectives but also, relatively speaking, independent of each other. In other words, you need people to be thinking for themselves, rather than following the lead of those around them. — James Surowiecki

If you thought the advent of the Internet, the spread of cheap and efficient information technology, and the growing fragmentation of the consumer market were all going to help smaller companies thrive at the expense of the slow-moving giants of the Fortune 500, apparently you were wrong. — James Surowiecki

This intelligence, or what I'll call "the wisdom of crowds," is at work in the world in many different guises. It's the reason the Internet search engine Google can scan a billion Web pages and find the one page that has the exact piece of information you were looking for. It's the reason it's so hard to make money betting on NFL games, and it helps explain why, for the past fifteen years, a few hundred amateur traders in the middle of Iowa have done a better job of predicting election results than Gallup polls have. — James Surowiecki

But, if recent history has taught us anything, it's that self-regulation doesn't work in finance, and that worries about reputation are a weak deterrent to corporate malfeasance. — James Surowiecki

In terms of productivity - that is, how much a worker produces in an hour - there's little difference between the U.S., France, and Germany. But since more people work in America, and since they work so many more hours, Americans create more wealth. — James Surowiecki

You can't fuel real economic growth with indiscriminate credit. You can only fuel it with well-allocated, long-term investment. — James Surowiecki

A consumer-finance agency is a good thing, but it would do well to teach consumers a simple lesson: if you don't understand the deal you're making, don't make it. — James Surowiecki

Politically speaking, it's always easier to shell out money for a disaster that has already happened, with clearly identifiable victims, than to invest money in protecting against something that may or may not happen in the future. — James Surowiecki

To be sure, if you watch CNBC all day long you'll pick up some interesting news about particular companies and the economy as a whole. Unfortunately, to get to the useful information, you have to wade through reams of useless stuff, with little guidance on how to distinguish between the two. — James Surowiecki

The world's central banks and the International Monetary Fund still have vaults full of bullion, even though currencies are no longer backed by gold. Governments hold on to it as a kind of magic symbol, a way of reassuring people that their money is real. — James Surowiecki

From a social point of view, it's beneficial that homeownership encourages commitment to a given town or city. But, from an economic point of view, it's good for people to be able to leave places where there's less work and move to places where there's more. — James Surowiecki

Now, modern economies have a very effective mechanism for deciding if salaries are really too high: it's called the free market. That's how most people's salaries are set, after all, including those of major-league baseball players and European soccer players. — James Surowiecki

I think people don't understand compound interest because typically no one ever explains it to them and the level of financial literacy in the US is very low. — James Surowiecki

All things being equal, letting people make decisions for themselves will produce smarter outcomes, collectively, than relying on government planners. — James Surowiecki

Pop music thrives on repetition. You know a song's a hit when you've heard it so often that you'll be happy never to hear it again. — James Surowiecki

Technology is supposed to make our lives easier, allowing us to do things more quickly and efficiently. But too often it seems to make things harder, leaving us with fifty-button remote controls, digital cameras with hundreds of mysterious features and book-length manuals, and cars with dashboard systems worthy of the space shuttle. — James Surowiecki

I do think to some extent multitasking is a way of fooling ourselves that we're being exceptionally efficient. — James Surowiecki

The typical American corporation is a shareholders' republic the same way that China is a peoples' republic. — James Surowiecki

Developing countries often have hypertrophied bureaucracies, requiring businesses to deal with enormous amounts of red tape. — James Surowiecki

In conditions of uncertainty, humans, like other animals, herd together for protection. — James Surowiecki

Nike used to be known as Blue Ribbon Sports. What's now Sara Lee used to be Consolidated Foods. And Exxon was once Standard Oil Company of New Jersey. These were name changes that worked. But for all the ones that do, there are 10 or 20 that don't. — James Surowiecki

You might think of consumption as a fairly passive activity, but buying new products and services is actually pretty risky, at least if you value your time and money. — James Surowiecki

The autocracies of the Arab world have been as economically destructive as they've been politically repressive. — James Surowiecki

The problem is that groups are only smart when the people in them are as independent as possible. This is the paradox of the wisdom of crowds. — James Surowiecki

In effect, dividing your attention means that neither (or none) of the things you're working on is really getting the full effect of your intelligence, and that it in the end takes you longer than it would if you did one thing at a time. — James Surowiecki

I tend to have a hard time working on pieces long before they're due. That's why I think the fact that I write a column is really good for me - the column has to be done, and there's no getting around it. — James Surowiecki

Traditionally, tours were a means of promoting a record. Today, the record promotes the tour. — James Surowiecki

In confusing stock options with ownership, corporations confuse trappings with substance. — James Surowiecki

The Xbox 360 is the best game console ever designed. It's fast and powerful - games look as good on the 360 as on high-end PCs that cost six times as much. It's easy to navigate and has lots of useful secondary features - the ability to play digital video, stream MP3s, and so on. — James Surowiecki

If companies tell us more, insider trading will be worth less. — James Surowiecki

Popular as Keynesian fiscal policy may be, many economists are skeptical that it works. They argue that fine-tuning the economy is a virtually impossible task, and that fiscal-stimulus programs are usually too small, and arrive too late, to make a difference. — James Surowiecki

Wall Street has come a long way from the insider-dominated world that was blown apart by the Great Depression. — James Surowiecki

Companies have long gathered data to break down their customer base into specific segments. Now political parties have become adept at micro-targeting, too, using data on shopping habits, leisure activities, voting histories, charity donations, and so on, in order to pinpoint likely supporters and the type of appeal most likely to win them over. — James Surowiecki

Defense contractors are able to reap tremendous profits while rarely confronting the risks for which those profits are supposed to be the reward. — James Surowiecki

The problem with venality in business is that getting outraged about it makes it easy to miss the systemic problems that venality often disguises. — James Surowiecki

It's a familiar truism that at any one moment, financial markets are dominated by either fear or greed. But the healthiest markets are those that are animated by both fear and greed at the same time. — James Surowiecki