Disputes over goodwill can seem arcane

WHEN it comes to concepts with inappropriate names, goodwill is near the top of the list. Instead of benevolence and big-heartedness, it provokes irritation and theological feuds among financial types. Goodwill is an intangible asset that sits on firms’ balance-sheets and represents the difference between the price they paid to buy another firm and their target’s original book value. If you think that sounds too abstract to care about, the numbers are huge. Total goodwill for all listed firms worldwide is $8trn, according to Bloomberg. That compares to $14trn of physical assets. Dry? Yes. Irrelevant? Far from it.