We all know that the billionaire investor Carl Icahn is a very shrewd investor. Of late, he has been sharing some of his views in his personal blog. And the latest one has a very interesting term that Icahn has coined - EBITDAT. Now for those of you who wonder what the last T stands for, it stands for THEFT. He jokingly says that the value of the company is not evaluated jusy by looking at EBITDA(which stands for Earnings Before Interest, Taxation, Depreciation, Amortization btw), but by also looking out at the corporate theft of the company.
Icahn is not necessarily joking. The upper management of troubled corporations, particularly financial institutions are very smart in innovating techniques to protect and expand their persoanl financial assets immaterial of the fact that there is a financial 9/11 going on and their company contributed to this downfall and is falling as well. While it is perfectly fair that executives of great-performing companies get paid handsomely, when failures are also rewarded in hidden forms, that is when the second T kicks in and plays the most significant role in EBITDAT.
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1 comment:
Its really bad that the common investor is punished in these case.
But at times these things really brings a lotta people into the investing arena since the stock values go down :)
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