GE Cuts Dividend to Save $9 Billion Annually
Industrial giant General Electric is cutting its dividend from 31 cents per share to 10 cents to save up to $9 billion a year.
Aside from sending the talking heads on GE-owned CNBC into a frenzy, the dividend cut did little to move the market.
On the other hand, it does do something to the economy: It takes $9 billion worth of cash out of the pockets of Americans. Thus, it could be seen as anti-stimulus at a time when the U.S. economy -- 70 percent of which depends on consumer spending -- needs exactly the opposite.
Most Americans probably think of GE as a company that makes refrigerators and light bulbs, but it's also a goliath maker of jet engines, wind turbines, parts for railroads and power grids and so forth. It also owns NBC and its affiliated cable networks.
But those aren't the business units that have hurt GE. It has been damaged by its consumer and business finance services, just like any big bank.
February 27, 2009; 2:02 PM ET
Categories: The Ticker | Tags: GE, General Electric, dividend
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