GE: Unfavorable Playing Conditions

GE is an exceptional company that utilizes a portfolio strategy to manage its strategic business units. This is important because you must remember that General Electric does not exhibit the same characteristics as it used to. General Electric is now an extensively diversified company whose performance is heavily reliant on the strength of the underlying economy. As you all know credit markets are crushed because of highly sophisticated derivatives. Some if not all banks utilized these vehicles in an attempt to pack on returns faster then the normal rate would allow. The point behind this explanation is that GE capital is their most profitable sector that subsidized alot of their other businesses that deploy alot of research and development spending. Ultimately I believe that as the economy improves and people start to realize that GE's involvement was substantially less comparatively regarding the usage of CDO's GE will make an unbelievable comeback.