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GE BANKRUPTCY?

3 March 2009 by Cullen Roche 6 Comments

There is massive volume in the GE June $2.50 puts this afternoon.   At $0.30 each there are major market participants betting on a potential GE bankruptcy.  These put buyers are essentially betting on a GE BK as the puts would not be in the money over $2.20.  We would likely have to redefine the word “fear” if this were to occur….

Related:

http://pragcap.com/ge-is-not-aaa

http://pragcap.com/how-bad-are-ges-woes

http://pragcap.com/can-ge-finance-survive

Bloomberg has more on the story here.

Video Update:


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Comments
  • ComradeBlogojavich

    This sell-off is getting ridiculous.

    03/03/2009 at 8:44 PM
  • Eric Sebille

    87x debt to tanigible equity per yahoo financials as of 12.31.08, I would not touch this thing with a 10 foot pole. Took my Goldman short off today and held my staples..the yields on pg, jnj, and kft all seem safe to me and I expect each to increase soon.

    03/03/2009 at 9:19 PM
    • Cullen Roche TPC

      Like the other financials, GE looks like a black box. Can't invest in what you can't understand. These balance sheets are impossible to comprehend because all of the assets are marked improperly….

      03/03/2009 at 9:28 PM
  • Cullen Roche TPC

    If the rumors are even remotely truthful, then this stock could still be overpriced….I would hope there is no truth to it. This would be catastrophic news for the US economy.

    03/03/2009 at 9:20 PM
  • Eric Sebille

    I think the market is ready for the GE BK, this could be the capitulation that sets us up nicely. Added some PM and more PG this morning.

    03/04/2009 at 3:31 PM