In some respects, the video-game business is a lot like the razor business, which follows a simple model: Give away the razor, gouge 'em on the price of the blades.
— 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.
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.
The business of America shouldn't be subsidizing business.
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.
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.
Republicans like to indict Democrats as anti-corporate zealots.
It may be that the very qualities that help people get ahead are the ones that make them ill-suited for managing crises. It's hard to prepare for the worst when you think you're the best.
Art collecting has traditionally been the domain of wealthy individuals in search of rewards beyond the purely financial.
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.
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.
Corporations hope that the right concept will turn things around overnight. This is what you might call the crash-diet approach: starve yourself for a few days and you'll be thin for life.
In American politics, 'Europe' is usually a code word for 'big government.'
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.
In industries where a lot of competitors are selling the same product - mangoes, gasoline, DVD players - price is the easiest way to distinguish yourself. The hope is that if you cut prices enough you can increase your market share, and even your profits. But this works only if your competitors won't, or can't, follow suit.
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.
If we want our regulators to do better, we have to embrace a simple idea: regulation isn't an obstacle to thriving free markets; it's a vital part of them.
You might say that economic history is the history of people learning to manage risk.
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.
In the struggle between capital and labor, more often than not capital has won, because the real source of value for most companies has historically been the hard assets that they owned and controlled.
You can't be rich unless everyone else agrees that you're rich.
All things being equal, letting people make decisions for themselves will produce smarter outcomes, collectively, than relying on government planners.
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.
Companies often become victims of their own mythologies.
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.
Publishers, naturally, loathe used books and have developed strategies to depress the secondhand market. They bring out new, even more expensive editions of popular textbooks every three to four years, in a classic cycle of planned obsolescence.
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.
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.
In conditions of uncertainty, humans, like other animals, herd together for protection.
In the auto industry, there's one thing you can always count on: if a new environmental or safety rule is proposed, executives will prophesy disaster.
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.
A general principle of good taxation is that similar jobs, and similar kinds of compensation, should be taxed the same way: otherwise, the government is effectively subsidizing some jobs over others.
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.
Of course, presidents are always blamed or rewarded for the state of the economy.
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.
Companies, like people, don't much like to change.
In the business world, bad news is usually good news - for somebody else.
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.
Life insurance became popular only when insurance companies stopped emphasizing it as a good investment and sold it instead as a symbolic commitment by fathers to the future well-being of their families.
Standards wars involve lots of variables, and understanding them often seems more an art than a science. They generally involve just two big players, and end in a winner-take-all situation.
Traditionally, tours were a means of promoting a record. Today, the record promotes the tour.
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.
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.
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.
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.
On Wall Street, fraudulent schemes tend to thrive during economic booms, and to blow up when times turn tough.
When Americans think of college these days, the first word that often comes to mind is 'debt.' And from 'debt' it's just a short hop to other unpleasant words, like 'payola,' 'kickback,' and 'bribery.'
Of course, looking tough on inflation is part of any central banker's job description: if investors believe that inflation is going to get out of control, you end up with higher interest rates and capital flight, and a vicious circle quickly ensues.
Besides great climates and lovely beaches, California and Greece share a fondness for dysfunctional politics and feckless budgeting.
Political risk is hard to manage because so much comes down to the personal choices of policymakers, whether prime ministers or heads of central banks.
