Ursus arctos middendorffi /kodiak bear/ Kodiakbär
Ursus arctos middendorffi/kodiak bear/ (Photo credit: Wikipedia)

The wit and wisdom of Wall Street is one of the great, perhaps the characteristic, American treasures. It ranges from statements of tradecraft (Don’t fight the Fed; Doctors make lousy investors) to acid, histrionic insights that seem to have come out of a novel by Raymond Chandler (Everybody in that room thinks he has a friend). My personal favorite–because it reverberates far beyond the Street itself–is Bears always sound smarter. I think about that phrase every time somebody tries to shoot down a new idea. I was chuckling over it when I visited a university campus earlier this year, and it rings like a mantra as I skim the comments on Kitchen posts. I will explain.

First, the vocabulary. A bear on Wall Street is contrasted with a bull. A bull is an optimist: the market is bound to go up. But a bear, well, a bear is steeped in Murphy’s Law. Everything that looks good is really bad, if you look at it right. The market is bound to go down. These two terms are captured beautifully in another Wall Street aphorism:

Bulls make money,

Bears make money,

Pigs get slaughtered.

The insight that bears always sound smarter is about more than Wall Street. It has a touch of Zen to it: it is a critique of human intelligence. Bears always sound smarter because there is much more clever stuff that can be said on the downside of anything. When you talk too much about the upside, you start to sound crazy. Take these crazy statements, for example: The Internet is going to change everything! Yeah, right. Open Access is the inevitable end point for scholarly publishing. Tell me another one. We don’t have a business model yet, but we have millions of users. Wake me up when you book your first sale.

Meanwhile, the Internet has changed everything, PLOS ONE is now the world’s largest journal, and a crazy scheme like a revenue-free social network called Facebook now has, literally, billions of dollars in sales. The bears sounded smarter, but they were wrong.

I took this idea to the liblicense mailgroup, where I posted a request for people to write me offline about all the ways people come up with to shoot down a new idea. As we say on the never-to-be-successful network of networks, ROTFL. I am not going to post a Top Ten list, but the comments fall into clusters and the commenters themselves seem almost like figures in a morality play.

Let’s begin with the one I personally find most exasperating, the Attorney for the Defense. Where is the evidence? Would you please tell me where is the evidence? When you respond that you are talking about a forecast for a future condition and there can be no evidence unless you reverse time’s arrow, the Attorney shakes his or her head and pronounces: I have to see the data. This is a great way to shut down just about every new idea because we can never know as much about tomorrow as we do about yesterday. But it’s hard to refute someone who stands on the bully pulpit of scientific evidence even when the topic is human imagination. (Human imagination?  Now what, pray tell, is that?) Lots of very smart people fall into this trap and they seem to take perverse pleasure in locking others up with them.

But even smarter, or apparently so, is the Deconstructionist. Sometimes d/b/a the Exceptionalist, the Deconstructionist is a head-shaker. No, you have not taken that into account; no, your generalization is way too general; no, you should stop your presentation here because there is too much left out on the first slide. The Deconstructionist has the special talent of finding every possible ambiguity in any word or phrase and unfailingly interpreting the expression in the way that the presenter did not intend. We see the Deconstructionist at work in committees, where every paragraph of a written report is almost impossible to read because of the need to close off every possible objection. Gosh, it’s a beautiful day, you might say, but the Deconstructionist responds immediately:  It is raining in Kuala Lumpur.

A cousin of the Attorney for the Defense is the Advocate for Premature Quantification. What’s the business model? Well, it might be interesting to see what would happen if we analyzed a text and mapped the outcome to the metadata of a book catalogue. What’s the business model? We could explore a means to tag books not only on the chapter level, but on the level of each paragraph. What’s the business model? I wonder if we could build an app that provided a real-time feed of abstracts for all articles in a particular subject area. What’s the business model? Putting an Advocate for Premature Quantification into a room with editorial people should be a violation of an international human rights treaty (The Deconstructionist says: They don’t have to be in the same room; you could use Skype), but I fear that Premature Quantification is trending. This appears to be especially true in the not-for-profit sector, where thoughtful business people are scarce and anyone who even utters a few numbers aspires to the status of Bill Gates (Attorney for the Defense: Where is the evidence for that?).

We should not leave out the Historian. My liblicense respondents had much to say about people whose typical remark is: We tried that 10 years ago; why do you think it would work now? The Historian displays his or her erudition by citing obscure examples from a bygone era. Historians are particularly attracted to the Scholarly Kitchen, whose comments section is littered with remarks by people who insist that the world can’t/won’t/must not change. And of course if you allow yourself to be baited by a Historian, the world will never change.

One final category (readers may wish to suggest others): the Worldly Sage. The Worldly Sage is wiser than the rest of us. Sages know how the world works; unlike the rest of us, presumably, they have actually visited the place. Don’t be naive, the Sage says, that will never happen because of the entrenched interests. Those interests can be anything from the predilections of a university provost, the maneuvering in Washington of an Elsevier or John Wiley, or simply the mechanisms of the marketplace, which is ruled by the fist of the big commercial firms. The point of view of the Wordly Sage was caricatured beautifully by a friend of mine, who said that some people meet any new idea with the same phrase: But Amazon . . . .  Yes, try to sell books from your Web site, but Amazon will stop you. Attempt to develop a community of readers, but Amazon will stop you. Reach out to libraries with a new program, but Amazon will stop you. In the mind of the Worldly Sage, Amazon has reached mythic status. No doubt there will be a feature film in which BezosMan battles Captain America (But what is the evidence?).

The fact that bears always sound smarter is a problem on Wall Street, where the seductions of bearish intelligence can cause someone to miss a good investment, but in the world of scholarly communications, it is truly deadly.  This is because people who work in academic publishing are almost all highly intelligent; it’s a group that graduated at or near the top of their class. And these folks have been told that they were intelligent from an early age; being smart got baked into their sense of self. So when a new idea is offered, oh, boy: Let’s sharpen the knives! New ideas don’t get evaluated on their merits (which may be hard to perceive in any event, as new ideas are often sketchy) but as a platform for a display of personal smarts. The comment Where is the evidence or What is the business model has a subtext:  Look how smart I am! There is a dark corollary to this:  It’s not only how smart I am but also that it is critical that you don’t appear smarter than me–or I, for the truly pedantic.

Let’s bring a bit of Zen into the discussions of innovation. Let’s begin with the assumption that intelligence is a commodity; it can be bought and sold; and besides, everyone you know already has it in surfeit.  Let’s try to be as thoughtful about things that are not yet here as we are analytic about things that are (Schopenhauer: Talent hits a target no one else can hit; Genius hits a target no one else can see). And when someone asks why you keep turning over in your mind a number of possibilities with no obvious outcome, respond by saying: That’s the business model.

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Joseph Esposito

Joseph Esposito

Joe Esposito is a management consultant for the publishing and digital services industries. Joe focuses on organizational strategy and new business development. He is active in both the for-profit and not-for-profit areas.


17 Thoughts on "Bears Always Sound Smarter"

Actually, optimism bias usually rules the day when planning new projects. That’s why large infrastructure projects typically face massive cost over-runs. Efficient project planning these days usually includes specific processes to curb optimism bias. There are a large amount of research into this, e.g.Flyvbjerg et al “Delusion and Deception in Large Infrastructure Projects” http://arxiv.org/ftp/arxiv/papers/1303/1303.7403.pdf

But those are the projects that made it past the bears to get undertaken in the first place.

Once again, Joseph Esposito writes a brilliant piece. Count me as a fan!

Though possibly not intended to, the post also reads to me as a written equivalent of an insightful satirical cartoon of another Scholarly Kitchen chef…

I think it’s a fair description of much of what we write here (I wouldn’t pin it to just one particular blogger) and as the editor of this site, something with which I struggle. It’s much easier to tear something down than it is to build something up. When something is clearly wrong, pointing that out is pretty straightforward. When something has potential or is intriguing, it’s often harder to define and articulate why.

There’s also a lot of crap out there. In the VC world, there’s an assumption that something like 9 out of 10 investments are going to fail (and a hope that the 10th pays off the losses from the others). There are a lot of naive and clearly flawed proposals being made in the world of scholarly publishing, and there is likely some value in applying expertise and challenging them. It’s always better when this can be done in a constructive manner, with suggestions for improvements rather than just ridicule, and that’s something we aim for, though I will readily admit that it’s something at which we don’t always succeed.

David, I very much enjoy reading this site you’re an editor of. Including, or perhaps particularly, the posts that I disagree with. I think you are building a good balance of viewpoints, no need for struggles of conscience.

Any pinning is left to everyone’s imagination. But I assure none of my voodoo dolls look like you.

I think it’s important, once you’ve decided that something might be a good idea, to search for every compelling reason not to do it. “Compelling” is the operative term here. “It might fail” is not a compelling reason, especially on the Internet, because we have a very bad record of predicting what will succeed and what will fail. “It will cost a fortune if it fails” is not compelling because therein lurks a hidden assumption, namely, that one has to spend a fortune to test “it.” Again, on the Internet, that’s generally not true.

For example, many folks in the UP/scholarly books industry have been promoting the idea of creating an all-UP/scholarly books online bookstore/portal. Such a bookstore/portal might yield great benefits for publishers. We don’t know because no one has run an experiment. And no one will as long as the conventional wisdom is that it would be too hard/expensive to coordinate all the publishers, harmonize the metadata and feeds, and build and maintain the site.

But that’s not really true, as I hope to show in a month or two.

The AAUP did in fact operate an AAUP Online Catalogue for about a half-dozen years. But then Amazon came along, and the effort was abandoned–which is not to say that the idea is not worth exploring again.

Nice job on perspective of bears in publishing industry…have seen this in spades relative to new approaches proposed to traditional publishers…nearly all are bears…thankfully, have found a few bulls willing to experiment with the future of publishing…

Bears also subscribe to a pseudo-genetic theory that the progeny of bad ideas can never be anything other than more bad ideas and so, need to be killed off as early in life as possible (ideational eugenics). Yet, there are ventures based upon inchoate ideas that looked pretty dumb at first but ultimately succeeded. This is the R&D dilemma.

Joe once again a very interesting perspective on risk.

I agree with much of the analysis but would have like to have seen the other side of the story.

I believe the role of the contrarian is very important especially when one is gambling with another’s money and livelihood.

I think of the old maxim:

“As you go through life, make this your goal:
Keep your eye on the doughnut and not on the hole.”

Excellent piece, Joe. I find the Amazon defense quite amusing. AMZN, whose stock is down 25% YTD, still trades at a lofty P/E multiple of 450. (by way of comparison, GOOG trades at 27x and FB at 72x). It is the poster-child of the optimistic Bull, yet it is used by Bears as an argument against other Bull’ish ideas. Now that takes some brass! 🙂

Great piece Joe, as always. I recognized quite a few of those characters you mention. One idea I try to use and instill, which I completely borrowed from Pixar, is the concept of plussing–if you want to criticize something, it needs to come with plus, a value-added, a better idea attached to it. So, instead of “But Amazon…” it’s “And Amazon…”

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