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Strategies & Market Trends : Value Investing

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To: Madharry who wrote (31442)	9/17/2008 1:14:17 PM
From: Paul Senior	Read Replies (5) of 78666

For the first time, I'm now starting to worry about GE and its financial exposure. Company is AAA rated. At this point that seems to me less relevant than the significance of the size of GE's debt - $561B. In this market it can't all be "good" debt. With a 4.7 d/e ratio and $19B in cash, these GE numbers all become a focus point in this market. When I look at AIG's gross numbers -- debt at $188B, cash at $58B, I have to wonder how dangerous an investment in GE could be. Doesn't help that GE at $23/sh is already at about a nine year low. Trying to figure upside/downside. Possible that GE could continue down. Maybe $15 in this kind of market. Upside hasn't worked for so many years -- maybe if DOW recovers, GE up about 20% from 23 to maybe 28. I'll call it my mistake to have made GE a full position for a ltb&h. I'm going to take my lumps and close position. If I reenter, it'll be for a trade.

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