5 ms·

The fact that the CEO of GE bought $3MM of shares after this report first came out makes me suspect it is, at the least, overblown.

kristopolous 7y ago
Many of Enron people also believed in their own malarkey. Systemic fraud usually doesn't have a foundation of calculating rational actors but instead irrational exuberance and magical thinking; as if economic fundamentals need not apply. Look at the dotcom bubble, bitcoin bubble, or the housing crash. The biggest offenders were also the biggest devotees to the dream. I say this being a shareholder in GE. I honestly hope I'm wrong and things turn around but insiders doubling down in hope of a brighter tomorrow is a poor investment indicator signal. It doesn't mean much.
Ididntdothis 7y ago
Isn’t $3mm pocket change for these guys? It doesn’t necessarily signal confidence to me.
- m0zg 7y ago
  Seven figures isn't pocket change for anybody. Unless they're doing this with someone else's money, that seems like a pretty good signal to me.
  - uptown 7y ago
    Here are the details of his compensation agreement: https://www.cnbc.com/2018/10/05/new-ge-ceo-larry-culp-inks-stock-heavy-contract-worth-up-to-300-million-if-shares-soar.html https://www.cnbc.com/2018/10/05/new-ge-ceo-larry-culp-inks-s... It's very much in his interest to stabilize the stock price.
    - m0zg 7y ago
      It's even more of a signal then. If these insinuations were true, there'd be no point whatsoever to spend $5M to buy shares of the company which he knows is insolvent. It's not like if this is true his share purchase would buoy all of GE.
  - deleted 7y ago
    [deleted]
chiefalchemist 7y ago
$3MM all things considered sounds like small potatoes to me. That's what, a couple hundred thousand chipped in from every board member? Put another way, did the CEO have any other choice? It's not like dumping shares would have been a kosher.
- unreal37 7y ago
  He'd never bought stock in 24 years with his previous company. So... $5 million of his own money invested seems like a decent bet.
arbuge 7y ago
Actually he bought $3m worth two days before the report came out, and another $2m after the report came out, for a total of $5m. Other GE executives/directors likewise bought more stock after the report came out. More significantly than any of the above, in my opinion, is that one of the world's most respected investors, Stanley Druckenmiller, stated he bought more after the report came out: https://www.cnbc.com/2019/08/15/stanley-druckenmiller-says-he-bought-ge-stock-during-plunge-thursday-believes-ceo-culp.html https://www.cnbc.com/2019/08/15/stanley-druckenmiller-says-h...

kristopolous 7y ago

Many of Enron people also believed in their own malarkey. Systemic fraud usually doesn't have a foundation of calculating rational actors but instead irrational exuberance and magical thinking; as if economic fundamentals need not apply. Look at the dotcom bubble, bitcoin bubble, or the housing crash. The biggest offenders were also the biggest devotees to the dream. I say this being a shareholder in GE. I honestly hope I'm wrong and things turn around but insiders doubling down in hope of a brighter tomorrow is a poor investment indicator signal. It doesn't mean much.

Ididntdothis 7y ago

Isn’t $3mm pocket change for these guys? It doesn’t necessarily signal confidence to me.

m0zg 7y ago
Seven figures isn't pocket change for anybody. Unless they're doing this with someone else's money, that seems like a pretty good signal to me.
- uptown 7y ago
  Here are the details of his compensation agreement: https://www.cnbc.com/2018/10/05/new-ge-ceo-larry-culp-inks-stock-heavy-contract-worth-up-to-300-million-if-shares-soar.html https://www.cnbc.com/2018/10/05/new-ge-ceo-larry-culp-inks-s... It's very much in his interest to stabilize the stock price.
  - m0zg 7y ago
    It's even more of a signal then. If these insinuations were true, there'd be no point whatsoever to spend $5M to buy shares of the company which he knows is insolvent. It's not like if this is true his share purchase would buoy all of GE.
- deleted 7y ago
  [deleted]

chiefalchemist 7y ago

$3MM all things considered sounds like small potatoes to me. That's what, a couple hundred thousand chipped in from every board member? Put another way, did the CEO have any other choice? It's not like dumping shares would have been a kosher.

unreal37 7y ago
He'd never bought stock in 24 years with his previous company. So... $5 million of his own money invested seems like a decent bet.

arbuge 7y ago

Actually he bought $3m worth two days before the report came out, and another $2m after the report came out, for a total of $5m. Other GE executives/directors likewise bought more stock after the report came out. More significantly than any of the above, in my opinion, is that one of the world's most respected investors, Stanley Druckenmiller, stated he bought more after the report came out: https://www.cnbc.com/2019/08/15/stanley-druckenmiller-says-he-bought-ge-stock-during-plunge-thursday-believes-ceo-culp.html https://www.cnbc.com/2019/08/15/stanley-druckenmiller-says-h...