GE = General Electric
As with any financial post, first and foremost, I am not a financial professional, I do not manage hedge funds, I have never taken any prior training, and I have only ever taken a few economics classes. With that said, take heed when reading these words. We are not responsible for any profits, losses, or choices made by the reader.
1) Safer than some banks. I’m not talking about huge banks that have merged to create super-powered-entities over the years like BoA, or Wells Fargo. I’m talking about the smaller “start-up” banks that you might find in a small town. I think there’s a better chance that some of these banks would lose all of your money before GE loses all of its profits.
2) Higher Returns. At current rates, the GE dividends pay back much more than the .01-.08% in money markets or CD’s. Of course you may owe taxes at the end, but it’ll still end up being more in terms of return. However, you do need to make sure you’re investing enough that the purchase fees don’t hurt your gains. Plus these dividends reinvested have the power of compounding interest. Ok maybe its not interest since they are dividends, and the stock can lose value, but the concept is still there.
3) Founded by Thomas Edison. Think about it. Thomas Edison basically invented electricity. He is a symbol of American science, and engineering. He was an American. He innovated for America. This might sound sort of nationalistic, but it’s true, the U.S.A. will probably have this companies back through thick and thin, and vice versa. This leads me to my next point.
4) You’ll probably know when the company will “fail.” The only time you’ll really need to worry, is if the company is going bankrupt, or completely screwed up management or something. At which point you can pull out your money. The only way I see this huge American company failing, which I don’t think will happen in my lifetime (although it’s very possible I could be wrong), is if America fails. Now lets not go into a discussion about how America’s economy is or how our government is doing or whatever.
You can try to convince me differently, but I’m not too worried about the USA falling like Rome anytime soon, and if it does, it’s not like I’m just going to up and move out of the country. I have friends here, family, I speak the language here, I know my way around, I know the culture. With that said, if America were to fall, and the country was in complete shambles, would it have been really that bad to lose your (now worthless) money in that investment anyways?
5) You like to gamble. Ok just kidding. I only wrote this to get your attention. I am not a gambler. Picking stocks is NOT like gambling. However, let’s put it this way. I would rather put $1million into GE, and count on them to make more money, than bet on red or black in Vegas. I’m pretty sure the highest probability game that anyone has of beating the house at a casino with perfect play and illegal card counting that will get you kicked out is ~49% in blackjack. Not fond of those odds. Of course stock gains wouldn’t be instant rewards (compared to if you were to win your colored bet), and if you buy way too high, you’re probably going to lose out, but fortunately stocks aren’t really “all or nothing.” Plus, dividends.
That’s it. I guess this could have been a post about why to buy “any” stock of a huge, successful, powerful fortune 500 company.