GE Conference Call

GE stock was down more than 9%, yesterday. The stock was down amid concern that the overview, which was announced less than a week ago, implies GE Capital will become a bigger-than-expected drag on overall results.

GE will hold a conference call this morning in an attempt to quell the panic. Of late, these investor conference calls have only added to selling pressure. Citi's conference call before the government rescue being the most recent example.

GE has missed its own quarterly earnings guidance twice this year in large part owing to shortfalls at GE Capital.

UPDATE: On the conference call, GE said earnings are trending toward the low end of its previous range and it plans restructuring charges.

Goldman Sachs Starts the Avalanche That Will Crowd Out Non-Connected Borrowers

Goldman Sachs yesterday became the first US bank to issue debt backed by the Federal Deposit Insurance Corp under yet another new Paulson/Geithner government plan to shovel money to the politically connected. Goldman raised $5 billion.

Under this program, money raised is guaranteed by the FDIC, which makes it as good as a Treasury raise. Among others, JPMorgan and Morgan Stanley, GE Capital are all expected to follow Goldman.

When all is said and done. $300 billion is expected to be raised by this program. That's $300 billion that won't be available to non-bank, non-privileged elite.

GE Gets FDIC Gurantee On $139 Billion of Its Debt

The FDIC guarantees non-bank debt? $139 billon worth.

Keep in mind, GE last month started using a new Federal Reserve program designed to revive demand for commercial paper amid the global crisis.

Where does it stop?

GE Capital is not a bank. The technicality that is allowing the FDIC to offer the gurantee is do to the fact that GE’s GE Capital subsidiary also owns a federal savings bank and an industrial loan company, both of which already qualify. But the debt guranteed has little if nothing to do with the banks.

Paulson Wants To Expand "Bailout" Beneficiaries Even Further

Bond insurers and specialty finance firms such as General Electric Co.'s GE Capital unit, CIT Group Inc. are now, among others, on Paulson's mind bending Bailout Road.

Warren Buffett As Fear Monger...

Billionaire Warren Buffett said the U.S. economy is ``flat on the floor'' after a cardiac arrest as companies struggle to secure funding and unemployment increases.

``In my adult lifetime I don't think I've ever seen people as fearful, economically, as they are now,'' Buffett said today in an interview with Charlie Rose to be broadcast tonight on PBS. ``The economy is going to be getting worse for a while.''

Yeah, right.

How nervous is Buffett about the economy? Last week he made a $5 billion investment in Goldman Sachs. This week he made a $3 billion investment in General Electric.

As I have pointed out, he will most likely be the largest beneficiary of Paulson's $700 billion Plan.

-Robert Wenzel