PHP stands for:
PHP: Hypertext Preprocessor
This a recursive loop, if I'm not mistaken. Did the creator of PHP have this in mind when he named PHP?
Is this the only language where the name has some sort of spurious grammar, spelling or phonetic?
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Recursive acronyms are fairly common. Probably the most famous is GNU is Not Unix
Of the top of my head Wine (Wine Is Not an Emulator), Jini (Jini Is Not Initials) and Lame (Lame Ain't an Mp3 Encoder) are all good candidates. However the winner for spurious grammar, spelling or phonetic must be the fact XML should begin with an E. The fact of all the Xs that this has spawned (XSLT, XHTML, XFL) are like death by a thousand paper cuts for pedants like me.
@Paul Butcher has already linked to Wikipedia's list of recursive acronyms, so I won't repeat any of them here. But there are still a couple of languages, libraries, frameworks, platforms and other software artifacts with funny or interesting origins.
My personal favorite is Linda, a tuple-space based distributed computing environment for Java. Explaining that name is a bit more complicated … There is a programming language called Ada, which is widely believed to be highly complicated and hard to use due to over-design by (government) committee. The designers of Linda wanted the system to be the opposite of that: very simple to use. Well, Ada is named after Lady Ada Lovelace, widely believed to be the first programmer ever. So, the designers of Linda decided to name it after Linda Lovelace, lead "actress" of Deep Throat, widely believed to be the first porn star ever.
Plus, there is a distributed computing environment for Ruby based on the ideas from Linda, which was written by a Japanese programmer, who decided to call this Ruby-Linda Rinda, making fun of the stereotypical speech impediment we Westerners typically ascribe to Asians.
And there is of course the Parrot VM, which is named after an April Fool's joke, which in turn was named after a Monty Python sketch.