The Old Economy

The old economy has clearly taken a backseat to the ‘new’ economy, with companies like Facebook, Amazon, Netflix and Google rising in price, almost without breathing.  All those FANG millionaires still have to live though . . . they fly, they require healthcare and they need electricity and water.

This summer, the oldest member of the Dow Jones Industrial Average was removed from that storied index and replaced, and the company’s problems are clear in the chart.

20180727 - GE

One of the tricks in investing is to invest in things that are relatively inexpensive, and yet are safe, and while there are many concerns about GE’s valuation, in other words the price may yet be too high, the company will probably be around for the foreseeable future.

This is our chart of the day, and if you are looking for a large, safe company with diverse businesses, which may shelter it from future economic storms, then GE is worth a look.

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