Immelt Says GE Failed to Anticipate Crisis Article By PAUL GLADER General Electric Co. Chairman and Chief Executive Jeffrey Immelt admitted, in a sober letter to shareholders, that he and his top executives, "never anticipated a global financial system failure and its continuing economic fallout." "2008 was a tough year and we expect 2009 to be even tougher," he said. Since he last wrote to shareholders about a liquidity challenge, the company has seen a "global financial meltdown. He recounts losses in the trillions and notes "we have now entered an economic recession across most of the world." He notes positive developments such as the company's participation in government loan guarantee programs. He noted that the company's industrial businesses and geographic diversity globally will help it get through the credit crisis. "Despite our efforts, the GE stock got hammered," he wrote. "Companies with a presence in financial services, like GE, are simply out of favor." He said that he will work hard to restore investor trust and to build GE for the long-term. More Letter to shareholdersMr. Immelt projects a guarded view of the future. "We are in a recession and, at times like these, it is difficult to predict how bad and for how long. We are running GE to 'weather the cycle.' However, I believe we are going through more than a cycle. The global economy, and capitalism, will be 'reset' in several important ways." He notes that interactions between government and business will be changed. He noted the financial industry will radically restructure with less leverage and fewer competitors. He notes the government stimulus will change infrastructure investments and plays to GE's positions in "big themes" such as emerging market growth, clean energy and sustainable healthcare. "Did we end up with too much exposure in certain areas during the credit bubble? Maybe, a few. Today, I wish we had less exposure to commercial real estate and U.K. mortgages," wrote Mr. Immelt. He notes GE is a 130-year-old growth company. "By my count, we have survived nine recessions and one depression." Write to Paul Glader at paul.glader@wsj.com
They should have slashed their dividents 1 year ago with their stock at 40$ and the DOW at 14000. Back then simple internet nerds like me knew economic collapse was coming by watching stupid youtube vids what's wrong with all those topdogs with their heads up their asses? They must be to busy banging expensive hookers and snoring cocaine then reading the newspaper I guess.