Wed October 7 2020
The SEC issued a Wells Notice to GE this past Tuesday.
A Wells Notice is an intent to investigate and gives the respondent a chance to defend past actions against such an investigation.
As beat up as GE has been I would not consider a 6 or 7% decline as falling off the cliff.
Under Jack Welch, GE was turned from a manufacturing giant to 50% financial services. One of his bad ideas was this 'insurance policy' which was supposed to pay for extended care. Reading the article it look like GE wildly under estimated its liability, ie people are living a lot longer than they used to.
Now GE accounting is under scrutiny.
Jeff Immelt succeed Welch and never had any good luck recovering the firm.
Welch was at least smart enough to retire around 1999 when the stock peaked. GE was the only stock originally in the DJIA which was still in the index, it has been removed since.
Professor Elam 
Leave a comment