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Financial Planning > Behavioral Finance

Finance and the English Language

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Financial language, to paraphrase Orwell, “is designed to make lies sound truthful…and to give an appearance of solidity to pure wind.” I thought of the great English writer’s classic essay, “Politics and the English Language,” from which these words are taken, during a recent industry conference.

Stationed in an area reserved for the press, I sat within earshot of my media colleagues as one corporate exec after another streamed in for interviews.

I was immediately struck by how alike most of them sounded. Their words seemed to obscure rather than define what it is they offered. 

The grand prize for most overused word nowadays is “robust.” It is not, unfortunately, the Starbucks coffee that these hyper-caffeinated financial company execs were referring to, but rather to humdrum features of their business like their “robust cash-flow management” systems. 

Sorry to burst your bubble, Mr. Exec, but your competitors’ clients get their cash when they need it, just like your clients. And they both get the same near-zero rate, too. (Give me a system that adds a few basis points over what my rivals are getting on safe cash, and I’ll let you use that word.)

Cash-flow management just does not qualify for such august description as “robust.” Even the migrant worker at the check-cashing store avails himself of robust cash-flow management. He needs cash, and presto, he’s got it.

I recently got a press release for an upcoming conference promising “a robust lineup of speakers.” I never heard of any of them and their position descriptions did not convey a particularly high stature. Is it their ability to bench-press 200 pounds that merits such accolades, or are the conference organizers just trying to give an appearance of solidity to pure wind?

A new analyst report claims that “mutual fund product innovation has been extremely robust post-market crisis as investors with heightened risk sensitivities seek out…[investments in hundreds of new funds].”

The above gobbledygook is designed to make lies sound truthful (and to earn a lot of money for meaningless verbosity masked as “insight”). As Vanguard’s Jack Brennan aptly said, proliferation is not the same as innovation. Indeed, in all likelihood, not one of those hundreds of new funds the report cited was innovative.

Before “robust,” “tool” was the financial word du jour, and “proactive” had its heyday before that. 

The abusers of these words are trying to project strength, utility and initiative, but they risk conveying exaggeration and insincerity instead.

Financial company executives—and financial advisors as well—don’t need to pulverize mountains or shatter boulders with their “robust tools.” They need to speak to clients with simplicity and sincerity and they should constantly search themselves to discover and articulate the true value they offer.