Who knew GE was a bank? Its finance arm has been given approval to gain temporary backing of its $139 billion in debt held by its finance arm by the FDIC. The move basically assures the corporate giant equal footing with banks to source its debt. Warren Buffett's Berkshire Hathaway received $3 billion in preferred stock with GE recently to help improve its liquidity. Recall that another Buffett company, Kansas Bankers Surety Co, helped send our financial markets into a tailspin and triggered the withdrawal of large sums of bank deposits when it announced it would no longer insure depositors accounts above the $100,000 FDIC-insured amount. The bailout bill approved after Buffett's company stopped insuring bank accounts boosted the insured amount per account to $250,000 through the end of 2009, substantially reducing the exposure of the Buffett-controlled insurer.
GE was once venerable corporate giant. It represented the best of corporate America more than any other company. Ronald Reagan once served as a spokesman for the company before entering politics. In more recent years, the company has been poorly managed and has experienced a precipitous drop in profits. The company's news division, NBC, basically became an extension of the Obama presidential campaign, openly pulling for his victory. Its cable news division, MSNBC, was particularly pro-Obama and has hampered the network's profitability because of its poor ratings. Not surprisingly, GE's white knight, Buffett, was a big Obama supporter who has been providing the president-elect advice on economic policy. It makes you wonder if some of the players manipulated economic events over the last few months to benefit themselves and Obama at the expense of the American taxpayer.
5 comments:
Buffet was on the panel of the nation wide Town Hall Meeting that was simulcast in 400 theaters across the country at the premiere of I.O.U.S.A. I couldn't believe how practically giddy Buffet was on the panel that included former comptroller David Walker.
Neal Boortz was livid today. He was ranting about
The Heritage Foundation's report that we have $40 trillion in unfunded liabilities for social security and medicare.
They said if we DOUBLED income and capital gains taxes today, while eliminating all government agencies, there would still not be enough money.
Good thing we have trillions in future income, and the option to delay retirement by a year or two, or this would be bad news.
Despite all of the love showered on the Sage from Omaha by the media etc., he manipulates federal, state and local regulations and officials for his benefit. Nothing new here.
And despite all of the blather about fair and free markets, no such animal exists, and most extreme riches have resulted from immoral and unethical behavior if not downright fraud and thievery. Don't get me wrong, intelligence and hard work is involved as it takes a lot of effort to continuously engage in this type of behavior every day of one's life.
Take Rahm Emanuel, Citizen Kane. The guy is a trust fund baby. He worked as a political hack in Chicago politics after finishing school. He lands a job at the Clinton White House. He leaves the White House at the end of Clinton's term and joins an investment banking firm. Although he has absolutely no prior business experience, he becomes a director for Freddie Mac. He makes about $16.5 million in two years as an investment banker and hauls a few hundred thousand more from Freddie Mac as a director. He is the epitomy of what is wrong with our country today. People are rewarded tens of millions, even hundreds of millions, in the business world for never creating a job, starting a business, meeting a payroll, etc. People who run successful, legitimate businesses in this country and work much harder never realize that much profit in their lifetime, let alone a 2-year period. As far as I'm concerned, people like Emanuel are thieves, pocketing the money of hard-working Americans for phony, paper transactions.
I find it ironic that in one paragraph, you criticize a company for making what was likely a prudent decision to exit a business, then in the next paragraph describe another business (GE) as being "poorly managed".
Your post really just seems to be sour grapes over Buffett's support of Obama. FWIW, I believe Buffett said before the election that either McCain or Obama would serve our country well as President even though he eventually went with Obama.
BTW, anyone with a lick of knowledge about GE knows that half of their biz is GE Capital.
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