General Electric and Big Capitalism
GE dropped below 15 bucks a share and I bought some. This is a broken company, but now sells for a fraction of what it did in earlier years. I want to find out more (granted, something I should have done before buying, but this will take a while). GE has a long and usually illustrious history. Thomas Edison was one of its original founders, it was one of the 12 stocks initially listed on the first Dow Jones Industrial Average (1896) and is the only one still on the DOW 30. The company has had superstar leaders and Nobel Prize winning scientists. It also has been a significant part of the dark side of capitalism. In other words, it is an interesting company and perhaps a microcosm of what big American capitalism is all about.
GE starts with Thomas Edison. He opened his Menlo Park lab in 1876 and his team invented the light bulb and electric power. In 1887 Edison moved his machine works to Schenectady, New York. incorporates various enterprises creating Edison Electric in 1890, but faces competition especially with Thomson-Houston. They merge in 1892 to form General Electric in 1892. Businesses included lighting, transportation, industrial products, power transmission and medical devises. Not just light bulbs, but electric fans, heating and cookware. Experimenting with plastic filaments led to a plastics department. Airplane engines stated about the time the US entered World War I.
GE is well-known for a coupe of scandals, a price conspiracy scandal mainly in the 195's which led to the first jail time for white-collar workers and defense contracting overcharging which led to embarrassing Congressional hearings rather than criminal cases. Long-time CEO Jack Welch (1981-2001) was considered an executive superstar, mainly for growing the company (particularly its stock value) and always meeting quarterly earnings targets. Accountants speculated that this meant massive earnings manipulation, not illegal but possibly ethically-challenging. Unlike say Enron, GE got away with it, possibly swaying into gray areas without committing illegal acts. Welch remains a CEO superstar. GE flopped big time during the 2008 subprime scandal, largely because of GE Capital (a major driver of earlier manipulation) and, despite restructuring attempt, never quite succeeded.