General Electric Company (GE)

[Jetmek_03052]

I don't think anything is particularly wrong with GE.

The fact of the matter is, GE ALWAYS follows the general market direction. This explains the recent price drop. The market has shed about 670 points in the last half dozen trading sessions. About 4%, right? GE has slipped almost the same percentage!

I think we will see further declines in the market for various reasons. Yes, it will still fluctuate up and down, but I believe the overall trend from here will be downwards.

One of the main reasons for this is the displeasure with the way the U.S. is treating the worlds reserve currency. Yes, we have stopped the QE for the moment. But if our economy should falter, there's no doubt in my mind that the Fed would start up the printing press with a vengeance. The world knows this is a possibility, as history tells the story.

Because of this, it's obvious that many would like to see the dollar be replaced by another currency. I believe that this currency change is inevitable and I think the replacement currency will be one that is backed(at LEAST in part) by a solid benchmark, such as gold. I believe this is why many of the nations that would like to see THEIR currency as the reserve are buying up as much gold as they can (China specifically). The BRIC countries are talking about a "basket" of currencies which would be made up to represent a reserve currency.

As to the U.S. - the recent passage of the budget tells the story. The U.S. politicians will just keep kicking the can down the road until the road ends. They aren't happy about it, but they just can't see a way to get us out of the mess THEY created.