Few things have been as revolutionary as the mnemonic device. Until the 20th century, modern science and mathematics as we know it were impossible because no one could remember their important rules. With the introduction of LEO-GER, SOH-CAH-TOA, and pimp Roy G BV, scientists were finally able to make breakthroughs such as microwave ovens, VOIP and lasers.
Why hasn’t the financial community applied these techniques to improve efficiency and increase memory? Surely, the use of exponentially increased complexity to memorize simple strings can be seen as potential value-add by banks and investing institutions whose main function is to exponentially increase complexity on simple transactions so they can collect a fee on them. (I’m half tempted to syndicate that sentence and charge you 50bps. Maybe I can interest in you some Long or Short Capital CDS products or our algorithimic trading platform?)
Cutting out the middlemen before they get involved, let’s make your understaning of financial terms more whole with the introduction of JDMDFKIF’s:
EBITDA: As Paulie Walnuts would say “EARNINGS BEFORE INTEREST TAXES DEPRECIATION AND AMORTIZATION…Gives the true picture of a company’s profitability.” A good way to remember what it means is to memorize this sentence. Eff Bitches In The Dairy Air.
ARPU means Average Revenue Per User. Artful Robbing, Possibly Useless. You also get a handy description of the value of this metric.
EPS means Earnings Per Share. How can you remember that as a CFA with an MBA from Kellogg? Easy. Eat Padma’s Salad. She won’t mind, she is trying to lose weight so her parents will find her a husband before she is 30 and she can get out of the banking world and into the kitchen. Samosa!
LFL is a term that is synonymous with SSS in certain situations. In other situations, it is not. The best way to remember LFL is this (letters in parentheses are silent): (L)same (F)store (L)sales.
The beauty of this system is that you can use these mnemonic devices to cut through all the typical Wall Street BS and lingo, and mainline the truth into your mini-baller IV. So if you see this:
Comcast lowered its EPS guidance today on news that its LFL growth had turned negative due to a decrease in ARPU. The company also lowered their EBITDA target to the low end of their previous range.
You know that that really means (translation smoothed for context)
Comcast did not eat padma’s salad today on news that its same store sales growth had turned negative due to an increase in artful robbing, possibly useless. The company also effed b*tches in the dairy air.
Recommendation: Unlock the power of your mind with Dianetics. Increase complexity as much as possible at all times; it is the only way to get simple things done.