Jeff Immelt Lies On CNBC This Morning

Jeff Immelt, GE's inept CEO, gave a hilariously pompous interview to one of the co-anchors from his own network, CNBC, this morning.

One of the perks Immelt enjoys as CEO of the ailing diversified industrial conglomerate is a steady stream of public appearances on CNBC. He can count on lapdog-style softball questions from his 'interviewers,' who are, of course, his own employees.

Jeff sure wouldn't want any tough questions on the country's largest business cable network, now, would he?

And he never has to worry when he books an appearance on his own network.

This morning, though, Immelt reached a new low.

He lied. Clearly and unambiguously, he lied.

What he said, in a sort of fumbling, embarrassed run-on answer to some inane question, was, referring to GE's recent performance,

"We've delivered for our advertisers and for our investors."

But if you look at the series of Yahoo-sourced price charts in this post depicting GE and the S&P500 Index for the past 6 months, 1, 2, 5 and 40 years, the falsity of Immelt's statement is instantly apparent.

In none of these charts does GE outperform the S&P under Immelt's reign. Not one.

The 40-year chart shows GE outperforming the Index, but that goes back to when Jones and Welch also ran GE. In entirely different eras than today's.



I suppose if Immelt has resorted to measuring performance over 2-3 month periods of his choosing, then, yes, GE has briefly, recently "outperformed" the S&P, as depicted in the latter part of the curves on the 6-month price chart.

But for a guy who has mismanaged and, my new favorite term, "misled" GE for 8 years, come September, this is surely reaching. Not to mention wildly distorting and contorting reality to make them fit his own definitions of GE's performance.

It's another measure of Immelt's desperation that he babbled about delivering for advertisers.

Jeff, those are customers. You have to give them what they paid for.

If you are now declaring success because you managed to fulfill your contracts with customers in GE's entertainment units, then your shareholders are probably much worse off than they realized.

Among the other idiocies Immelt babbled about in the interview were that GE's entertainment, infrastructure and other businesses still make sense being in a common corporate shell. And that GE's NBC network is a valuable asset, albeit only when it has 'high quality' content, i.e., has purchased Olympic coverage rights at astronomical rates.

At one point in his monologue, Immelt rattled off some revenue, income, and growth statistics for GE, attempting to justify his value destruction under the guise of logic amounting to,

'Hey, we're big and slowly getting bigger. We make some money. That's enough, isn't it?'

No, Jeff, it's not enough. It's not about net income growth or size. It's about the total return you can consistently deliver for your shareholders in excess of what they can earn for next to nothing by buying the S&P500 Index, which is far less risky than your outmoded conglomerate.

In fact, by no means can Jeff's investors, i.e., shareholders, feel they have been delivered for, or to. Look at the last chart. It's clear that GE's value peaked just about the time at which Immelt replaced Jack Welch as GE's CEO. It's been downhill from there for GE shareholders.

During the time in which Immelt has destroyed GE shareholder value, the S&P has remained flat.

Immelt has destroyed value by retaining GE's outdated and unwieldy conglomerate structure for far too long.

It's a testament to Jack Welch's following among the financial community, and investors, that GE's stock price performance handily outperformed the index's during his reign from the early 1980s to 2001.

Welch probably could have outperformed the S&P500 running a lemonade stand. The guy not only managed GE to exceed investor expectations, but somehow magically had what it took to sprinkle pixie dust into analysts' eyes and convince them that GE's archaic conglomerate structure still added value.

Immelt, on the other hand, has failed at this from the moment he took over the CEO's job.

It's one thing to acknowledge failure and try harder. Or even ask forgiveness for failing.

Immelt would even get points if he just admitted that GE isn't working with him at the helm, and either step down as CEO or break the company up.

But to simply lie about GE's total return performance 'for investors' is a new low. Even for Immelt.