3 ms·

Im not able to see the context here. How is it a con?

• blitzar 2y ago
  https://brk-b.com/why-charlie-munger-despised-ebitda_240201.html https://brk-b.com/why-charlie-munger-despised-ebitda_240201....
• rwmj 2y ago
  It's known colloquially as "Earnings before bad stuff" because you can use it to hide all the stuff in your accounts that doesn't make you look good. It's not a con, more like obfuscation.
  • dspillett 2y ago
    > It's not a con, more like obfuscation. Which is a very subtle and complex distinction, like the difference between tax evasion and tax avoidance.
    • ggm 2y ago
      Feather? Legal. Whole bloody chicken? Pornography.
      • dspillett 2y ago
        Nah, the feather is erotic, the chicken is kinky. Both legal by my understanding. Unless the chicken is live.
  • refurb 2y ago
    It's one of many metrics that you can use to evaluate a business. Note that's it's not "bad stuff", it's interest, taxes, depreciation and amortization. I'm not sure anyone consider depreciation bad? It's a metric that strips away things that can distort net income. It allows one to see what the core business produces.
• indymike 2y ago
  It's not if you use it to understand cash flow. If you use it as a profit replacement, you might be disappointed.