Andy Grove: "Only the paranoid survive"

Business success contains the seeds of its own destruction.  The more successful you are, the more people want a chunk of your business and then another chunk and then another until there is nothing left.  I believe that the prime responsibility of a manager is to guard constantly against other people’s attacks and to inculcate this guardian attitude in the people under his or her management.  Only the paranoid survive.

~ Andy Grove, Only the Paranoid Survive (1996)

1996

 

David Laband on "unfair competition"

Every effort by small businessmen to forestall the building of a Wal-Mart is an attempt to shoot the messenger rather than pay heed to the message.  Local economies do not go to pot when Wal-Marts are built.  Quite the opposite: Sam Walton once said, "There was a lot more business in those towns than people ever thought."

Without question, each Wal-Mart and Sam's store alters the structure of local unemployment.  The sons and daughters of local businessmen and women no longer follow in their parents' proprietary footsteps.  Now they, as well as many other local workers, go to work for Uncle Sam (Walton).  Thus, the overall rate of local employment is generally not adversely affected.  While we may feel sorry for the personal losses suffered by the owners of these no-longer competitive small firms, the aggregate benefits reaped by (all-too-often- forgotten) consumers, including those same small businessmen, outweigh their losses...

The pleas to local zoning boards and planning commissions for protection from "unfair competition" by small businesses faced with the prospect of having to compete with a new Wal-Mart store sound identical to the rhetoric employed by mouthpieces for the Big Three automobile companies, the textile and steel industries, sugar producers, and every other domestric industry seeking to restrict foreign sales of these products in America.  To kick Japanese and other foreign producers out of American markets is to deny the benefits of Sam Walton-esque competition.

[...]

By invoking the rhetoric of "unfair competition," domestic firms seek deliberately to mislead consumers into thinking that protection of competitors is the same thing as protection of competition.  Nothing could be further from the truth.  Protection of the existing firms in an industry against more efficient competitors, be they American or foreign, insulates those firms from the forces of competition.  American consumers are the worse for it: they pay higher prices for shoddier products than would be available in a more competitive environment.

Japan-bashing is equivalent to Sam Walton-bashing.  The principles of competition are universal, whether the competitors are domestic or foreign.  The fact that sellers are foreign does not diminish the potential gains to American consumers from competition between sellers.  If we're going to lionize Sam Walton, consistency demands that we lionize every successful producer in the global economy.

~ David N. Laband, "Lessons from an Entrepreneur," The Freeman, September 1992

(Article was reprinted in The Spirit of Freedom: Essays in American History, edited by Burton W. Folsom, Jr. This quote appears on pp. 197-198.

Russell Lamberti on sports and egalitarianism

Sport is a radical hierarchy of excellence sorted by genetics, upbringing, resources, luck, volition and character.  Egalitarians therefore hate sport and are driven relentlessly to disfigure it with ideology.

~ Russell Lamberti, tweet, July 29, 2021

The New York Times admits that government protects Big Business from smaller competitors

The economy suffers from a lack of fair competition, many economists believe.  Large corporations are often able to increase profits not by providing better products than their rivals but instead by being so big that they exercise power over workers and consumers.  The government also plays a role, through policies that protect existing companies at the expense of start-ups and new entrants into an industry.

~ The New York Times, July 9, 2021

Vince Lombardi on persistence

Winners never quit and quitters never win.

~ Vince Lombardi

Jason Hsu on China, competitiveness and ESG

To outcompete globally, to generate profits - this animal spirit of responding to monetary incentives is stronger in China than any other country I ever visited. Whereas, if you look at the U.S. and Europe and Japan today: ESG investing, purpose investing, impact investing, where investors are saying, "Hey, I'm willing to make less money, lower return for other reasons," right? "My investing, my work isn't merely profit-driven." And that ethos almost points to anti-capitalism. Capitalism requires you to be entirely selfish and profit-motivated. So that's the dichotomy in China. On the one hand you have extreme profit-motivated behaviors that's led to phenomenal growth. That's led to everyone acquiring a tremendous amount of education and working tremendously hard and producing prosperity and growth, but with a backdrop of a society that's also very distrustful of a market mechanism. 

~ Jason Hsu, "Quantamental Investing Lessons with Jason Hsu," 27:30 mark, Stansberry Investor Hour, March 18, 2021

Evan Lorenz on competition heating up in Big Tech

On Oct. 20, the U.S. Department of Justice filed a suit against Alphabet [parent company of Google], alleging that the search giants payments to Apple, Inc. to make Google the default search engine contravenes U.S. law. To put the Department's suit in perspective, Alphabet pays Apple an estimated $8 billion to $12 billion per year, a sum equal to between 12% and 18% of Cupertino's operating income. Nearly half of all Google searches originate from Apple devices. This is not a parking ticket. However, there appear to be contigency plans. Two-and-a-half years ago, Apple hired John Giannandrea, Google's head of search.  An Oct. 28 report by the Financial Times found that iOS 14, the latest iPhone operating system, used Apple's home-grown search engine for certain user suggestions.

[...]

As we go to press, Apple trades at 35.6 times trailing earnings and Alphabet at 36.5 times.  The stocks seem priced for everything - except competition.

~ Evan Lorenz, "Comity in Washington," Grant's Interest Rate Observer, November 13, 2020

Inigo Fraser-Jenkins on how Amazon is destroying retail moats

If Amazon is going to continue to destroy other parts of the retail sector, say, then why should we expect mean-reversion to still hold?  We agree that this dynamic is likely behind part of the underperformance of value.  Technology has disrupted industries in a way that may permanently destroy ‘moats’ that used to exist around certain industries.

~ Inigo Fraser-Jenkins, Sanford C. Bernstein’s head of European quantitative strategy, "Is value investing dead? It might be and here’s what killed it," CNBC.com, June 23, 2019

Sheldon Richman on competition and cooperation being two sides of the free trade coin

Competition is merely part of my being free to decide with whom I wish to cooperate. It really is that simple. The alternative would be some sort of compulsory cooperation, but that doesn't sound so warm and fuzzy anymore, does it?

~ Sheldon Richman, "Libertarianism: A Necessary Review of the Foundations," The Tom Woods Show, September 8, 2020

Basketball great Kobe Bryant dies in helicopter crash at age 41

You always have to be on edge. You always have to take every practice, every game, like it is your last.

~ Kobe Bryant R.I.P.

Kobe Bryant, a.k.a. "Black Mamba"
NBA #4 all-time scorer with 33,643 points
August 23, 1978 - January 26, 2020

John Madden on competition

If you can't run with the big dogs, stay on the porch.

~ John Madden

Former Sun Microsystems CEO Scott McNealy says the future of Silicon Valley is bleak

I see a migration from the early days of the Valley. We aren't doing manufacturing; we aren't doing design; we aren't doing computers. It's all moving to Asia and other places where there are lots of technical engineers who are willing to work at a more reasonable salary because they don't have to spend $3.5 million on a home and pay half of it to taxes.

I think every new transition has created less job opportunity as technology has become very leveraged. I don't think our education system, our regulations, our government policies have kept pace with the changes that technology is driving.

Maybe I'm sounding like an old guy, but [Silicon Valley] ain't what it used to be. I, for one, don't think this is the best place in the world to start a company.

I'm having the time of my life, but I'm an old guy. I'm not young with my whole future in front of me. My kids are the ones who are going to have to learn Mandarin. I've suggested that to all four of them.

~Scott McNealy, former CEO, Sun Microsystems, The Wall Street Journal, "Former Sun CEO Worries About Region's Prospects", February 10, 2011

John D. Rockefeller on competition

Competition is sin.

~ John D. Rockefeller, as quoted by G. Edward Griffin in The Creature from Jekyll Island, page 434

Friedrich Hayek on class exploitation

There has never been a worse and more cruel exploitation of one class by another than that of the weaker or less fortunate members of a group of producers by the well-established which has been made possible by the "regulation" of competition.

~ Friedrich A. Hayek, The Road to Serfdom, page 129

Lesch on competition

The underdog in many products… can pick and choose where it wants to hit the giant; the giant, by contrast, must defend itself everywhere.

~ George Lesch, Colgate-Palmolive executive

Ed Bugos on regulation

The best way to regulate the bad guys is to allow the good guys to compete.

~ Ed Bugos