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What ‘synergy’ really means

WHITE BOOKWHITE BOOK
"The Devil's Financial Dictionary" by Jason Zweig.

In his new book of alternative financial definitions, Jason Zweig explains some of Wall Street’s favorite terminology. Here, a sampling.

BULL, n. A person who believes that an asset will go up in price, a belief often based exclusively on the fact that the person happens to own it. A bull in full stomp is almost incapable of absorbing any evidence suggesting that the asset might go down instead.

DOVE, n. A central banker who believes that an economy that hasn’t responded to anything else the central bank has done will respond when it cuts interest rates.

HAWK, n. A central banker who believes that an economy that hasn’t responded to anything else the central bank has done will respond when it raises interest rates.

MODEL, v. To write complex mathematical formulas that capture every conceivable variable in every possible situation—except, that is, the one that is about to happen next, destroying the value of the portfolio that has been built around the model. As a noun, model can best be defined as “a weapon of math destruction.”

POTENTIAL CONFLICT OF INTEREST, n. An actual conflict of interest.

SHORT-TERM, adj. On Wall Street, thirty seconds or less—as opposed to LONG-TERM, which is thirty seconds or more.

SYNERGY, n. Often, the only thing one company gets when it buys another; as Warren Buffett put it, a term “widely used in business to explain an acquisition that otherwise makes no sense.” Because no one, including any of the executives at either the acquiring or the acquired company, knows what synergy is, it seldom turns out to have been worth paying for.

A version of this article appears in the September 15, 2015 issue of Fortune magazine with the headline “What you mean when you say ‘bull’.”