GE is a financial black hole. There I said it. Why aren’t more people saying it?

Anyone who claims differently in my humble opinion is a liar. Trying to figure out how GE Financial earns its money or how they value their assets is no different than Bear Stearns or Countrywide Financial. Its impossible.

Proof of this is clear as day from CEO Jeffrey Immelt’s comments that it wasn’t until Bear Stearns blew up that GE’s earnings were impacted. CEO Jeff Immelt had come out on March 13th and reassured everyone that GE was on track to meet their annual earnings estimate. Now he says that those comments were still valid until Bear Stearns blew up. That is complete nonsense.

I will tell you what happened. The accountants came close to the quarter end and became frightened at how GE was valuing their assets, and told the higher ups that there was no way they could value their assets as they were on December 31st. I’m sure there was an unholy battle inside GE to fight against this. Stories are legendary about the company and its “cookie jars” and its managers doing “anything” to make their numbers.

35% to 40% of GE’s earnings come from GE Finance. Is it really any surprise that earnings would come under pressure considering the financial destruction that’s going on? And their earnings were fine until Bear Stearns blew up, then they weren’t? Puh-leaze.