Energy News Today

The Collapse of GE’s House of Debt Was 130 Years Coming

Even the conglomerate structure that current Chief Executive Larry Culp’s split will finally dismantle was in some ways a response to credit conditions. When debt is scarce, lenders are unwilling to provide cash to foster new and innovative businesses — but they’ll happily fund a blue-chip giant, a factor that once gave industrial conglomerates a crucial advantage over smaller businesses. By borrowing using its enormous balance sheet, GE could funnel cash at below-market rates into riskier ventures, helping to innovate faster and perfect the many inventions that emerged from its Research Laboratory: lightbulbs, power stations, X-ray machines, electric cookers, radios, televisions, lasers, jet engines and nuclear power.

Read More: The Collapse of GE’s House of Debt Was 130 Years Coming

2021-11-13 19:11:13

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