Comments on: What Buffett May Be Missing at GE

By: Matt

Matt — Mon, 06 Oct 2008 22:09:54 +0000

Right On,

I did the same exercise the other day at the SEC edgar web site,
Since I have not been in the market, I have had no reason to evaluate GE’s
financial statements until this weekend.
I felt like Rip Van Winkle waking up to a balance sheet from Hell.
This is worse ratings than they gave to mortgage backed securities.

I feel GE will go down unless directly funded by the Fed, with the commercial paper market falling 100 billion a week, and GE’s hundreds of billions in short term funding, GE’s new 12 or 15 billion in new capital should last about 1 week.

The good news is that 28 percent of the commercial paper market matures in the next 7 days, and that the US borrowers actually were able to roll about 300 billion last week. The bad news is that the only money in the
US will be either from banks or directly from the Fed, which will be deciding which US companies do not go into receivership when they cannot borrow money in the market.

http://www.federalreserve.gov/releases/cp/outstandings.htm

By: john

john — Fri, 03 Oct 2008 14:32:29 +0000

GE either needs to go way down and possibly fold, or fire their CEO who has taken them down the tank in the first place.
Save the company or the CEO. I would think that would be obvious to the Board.

By: Marty Ueland

Marty Ueland — Fri, 03 Oct 2008 05:17:12 +0000

I have admired Warren Buffet for all of these years as the wise guy, but now I am 65 years old, and find he is not. Buying into such a one sided liberal group of people takes all of the respect away.

By: T. M. Hardy

T. M. Hardy — Thu, 02 Oct 2008 19:53:19 +0000

What the author of the attached article did not mention is that even the company’s industrial businesses are in jeopardy of a drastic, and perhaps dramatic, slow down because of the ever slowing global economic slowdown caused by the present crisis and other macroeconomic factors.

The financial services companies that Wall Street, and many other financial pundits, had long espoused GE spin off are threatening the tenability of the company’s coveted triple A rating. The company’s recent preferred stock investment by Mr. Buffett was an attempt to shore up the company’s balance sheet for the preservation of its AAA rating, and not the advertised reasons it told the market. Additionally, any new “opportunities” that the company would take advantage of would certainly be industrial in nature and not financial services oriented, as this would exacerbate the company’s already troubling structure.

It is very foreseeable that a new CEO of the company will be chosen in the near future and that many of these financial services businesses will be sold off at the first discernible signs of a true recovery in the financial markets, especially by a new CEO.

Conversely, the company might be forced to enter the commercial banking business to support its lending activities and better match its funding/ lending maturities, this would inevitably remove the company from the status of triple A and to more likely double A to match peers or comparable size and given its off balance sheet debt.

Toia

By: Chet F

Chet F — Thu, 02 Oct 2008 19:36:16 +0000

Congress is just like my kids were when they were young, What part of no don’t they understand? Each time they do something it just makes things worse!!! The sun will certainly rise tommorrow. Unless congress gets involved.