Glossary W

The financial world is full of jargon - i.e. strange words no-one understands. Here we try to explain some of the many technical terms.

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W

War

"...what is it good for?"

" ... the economy, stupid!"

Sad, but true.

The weapons industry is very, very big business, especially in the US where it has a stranglehold on government through donations and lobbying. Ironically, US President Eisenhower - who was a general in WW2 and knew something about it from the inside - famously railed against the power of the "military-industrial complex" in his last speech - but this was one battle where Ike took a helluva beating. Big Guns is Big Money - peace therefore hurts the balance sheet; what you really want therefore is domestic fear and paranoia, coupled with an endless supply of largely defenceless foreign bogey men who can be attacked at will with very little danger to oneself.

Military hardware is another place where, yet again, the free market does not apply; the greatest profit margins to be had are in high-tech weapons; unfortunately these cannot be sold to the people who actually want them - the defenceless foreign bogey men - and so the countries who make them, have to buy them themselves, i.e. the taxpayer pays for it all. Think about that if you live in a town with no public library, or you can't afford to see a doctor about your persistent cough.

When the war against Iraq began, world stock markets rallied strongly; shares in Boeing and Raytheon shot up; this rally continued throughout 2003.

Warrants

An option usually issued by a company, rather than an exchange; typically with a very long expiration date.

Warren Buffett

One of the world's richest men (- usually listed as second, just behind Bill Gates of Microsoft) and its most famous investor; the guru of all gurus (- and not an empty one either). You will often hear quotes about how much $1 invested in his company, Berkshire Hathaway, at its inception would be worth now ... basically, its a lot. Known as the Sage of Omaha, he has a very sympathetic public image; his investing style is seen as being a vindication of good old-fashioned values, for example, he avoided any disasters involving Tech stocks during the last boom (- since he didn't buy any, and was criticized for it at the time), and derivatives do not seem to be his style.

You will come across a great many books on investing which attempt to analyze Buffett and emulate his methods - the usefulness of these is open to question. If you want to copy Buffett, then you should simply invest in his company.

Wavelets

A new and powerful signal processing technique, similar in spirit to the Fourier Transform, but more flexible and with many superior properties.

Wealth Management, aka Private Client Banking/Services

A myriad of off-the-shelf tax avoidance schemes offered to high rollers by the major banks.

Please note: unless you have at the very least (- and ideally much more than) 100 grand in cash, your 'business' will not be welcomed. Shoo! Shoo away, little pauper ...

When to Buy and Sell

This is the Holy Grail of investing; if you knew this, you could buy every bottom and sell at every top, reinvesting your profits each time and so generating geometric growth for your money; in no time you would be a billionaire!

But given the frantic nature of stock price movements, trying to gauge the exact tops and bottoms of the market is unlikely to be successful - so stick to probabilities; take your profits when your target is reached and cut your losses when you have hit your stop level. Do not get hung-up on ideas of 'if only I had kept the position open' or 'if only I had closed my position'. If you can make a small profit with little risk, reasonably often, you are playing a savvy game.

Whipsaws

Very frequent reversals of a stock between buy and sell signals, based on various technical indicators; note that if your buy/sell indicator is oscillating violently between opposite viewpoints, it is unlikely to be of much value.

Whisper Numbers

Rumoured true earnings which have been leaked to the market by 'those in the know' (- who are these people? Where did they get their information from? Who told them, and why?!)

The same rules apply as for all rumours - be aware of it, but treat it with skepticism.

Work

The curse of the drinking classes. [Oscar Wilde]
"... is a 4-letter word". [1968 Film]
Never Work! [Guy Debord]

WorldCom

A financial scandal of similar or greater magnitude to that of Enron, but which seems not to have attracted much in the way of legislative sanction, i.e. one might expect the company to have been wound-up and in the hands of the receivers by now, and for at least some of its managers to be doing serious jailtime - but this has yet to happen.

World Bank

[Being 'Fair and Balanced' here -]

An organisation which makes loans to poor countries in order to help them develop their economies, thus helping to eradicate the blight of poverty from the Earth.

An instrument of US imperialism. Let's use an analogy - think of the World Bank as your friendly neighbourhood Loan Shark, then, the IMF is best thought of as being Big Tony and Rocco, the loan shark's friends, and the Structural Adjustment Program is then a baseball bat; finally, the Pentagon is the hitman waiting in the shadows should you fail to show the necessary 'Respect'.

Writing

Writing an option means to sell an option.

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