We might be seeing the end of GE

Outside The Beltway
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The company has been falling on hard times but recently they are in full blown crisis mode. They are trying to sell off iconic departments of their company like avianonics.

The company got cut from the blue chip index, and dramatically slashed their dividend as they are over 114 billion in debt.

I pulled this from Forbes.

“Let’s say you were a machinist who retired in 2000 with 5,000 GE shares worth $250,000. If you didn’t sell them, those shares are worth $30,000 today. And instead of paying you $4,800 a year in dividends (24 cents a share per quarter), you’re going to get a mere $200 a year (4 cents a share per year) unless GE cuts it even more.”

I saw what was coming to sears and possibly JcPennys, I never thought I would see this happen to GE. The stock is now trading at 15% the lowest point of the Great Recession.

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Ya it’s been an epic crash. A lot of tech is falling to… feel bad for all the bagholder old timers

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GE is a massive company that is 350,000 jobs not counting all their sub companies.

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I can’t imagine what is happening to the people as in the article who had retired and there shares went from 250k to 30k along with the dividend being slashed to a penny. I never would have thought even a year ago this would be happening with GE

5

Yep… It has been a while coming.

A little over a year ago I bought GE stock thinking that the parts would be worth more than the whole.

I was wrong.

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Ya that’s the market though and why you need to diversify. No one in 2006 thought 2007-2008 would happen. That’s why they are called bubbles - and that’s why nothing is ever a sure bet. I havent been following the details for GE, but it is epic. Almost at 2008 low…I dont know of bankruptcy is a legitimate concern or if that’s just blood in the streets talk. But if it gets to $5 I might pick up some shares

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They are having to sell many of these divisions as they are not profitable. If they sell their avionics that’s it. That is were they make their big profit and is 17% of their company.

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I’m to much of a wimp to buy stock

9

So, what’s the root cause?

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GE is the last company who was a founding member of the DOW to be kicked out.

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I know that, and you know that about diversifying a portfolio. I would imagine the average Joe on the assembly lines haven’t a clue.

I wasn’t invested in GE it’s just more of an iconic American Brand I hate to see this happening to, or at least none of us thought a year ago this would be being discussed.

12

Need more tariffs!

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Forbes breaks it down to massive debt, their products are in unattractive industries besides aviation. There R&D isn’t producing.

14

Ya…Sears bankrupt, GE getting crushed, it’s a changing world

15

Thanks.

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Markets are so high right now tho…GE and AAPL might be the catalyst for next down turn. We flatlined for a year or 2 before last crash. Plus AMD is kind if a strange leading indicator…with huge exponential runs

17

It’s like watching a company like jnj go under. Sears was an iconic retailer, but GE that’s American Engineering and innovation it hurts :frowning:

1 Like
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Your welcome

19

That’s why I encourage all my clients with concentrated stock positions to diversify. They hate me if the stock keeps going up, but love me when it doesn’t,. I try to impress that diversification is not a bet on the direction of price – it’s a risk reduction strategy. I’ve seen the same story with AOL, TimeWarner, Fannie Mae, Citigroup, etc.

1 Like
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You’re mixing 2 different things: the risk of the market (systematic) vs risk of individual stocks (unsystematic). You can survive stock market plunges if you are diversified. You cannot survive a permanent loss of capital resulting from holding a concentrated stock position.