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A Refresher on Return on Assets and Return on Equity

Harvard Business Review

A service business may have expensive computer and IT systems. What is Return on Equity (ROE)? Unlike ROA, you want the ROE to be as high as possible, but there are limitations. ” How do companies use ROA and ROE? What mistakes do people make when using ROA and ROE? Retailers need a lot of inventory.”

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Would You Want Carl Icahn to Run Your Company?

Harvard Business Review

"We have a dysfunctional corporate governance system in the United States and nobody can attack it and nobody can do anything about it because it's like the feudal system." That's Carl Icahn, in a fascinating interview with Reuters BreakingViews (thanks to Jeff Glekin and Lucy Marcus for pointing me to it).

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Idle Funds are the Devil's Playground

Harvard Business Review

He cited the International Monetary Fund's 1997 judgment that "Malaysia is a good example of a country where the authorities are well aware of the challenges of managing the pressures that result from high growth and of maintaining a sound financial system amidst substantial capital flows and a booming property market."

Banking 11
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End the Religion of ROE

Harvard Business Review

corporation than "what's the ROE on that?" ROE justifies the means. To an extent not widely recognized, it was an equation in the first place that gave ROE the power to dominate not just investment decisions, but an entire business culture. So it's time to address our measurement system seriously at the firm level.

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