This past Friday morning was like any other Friday morning, except for the fact that, I highly anticipated a very nice early Christmas present. I waited like a young child wondering if Santa really got his letter, and if he thought I was really a good boy this year. Like every kid who has ever dreamed of getting the coolest and newest toy, I waited patiently (Well, maybe not patiently) for the present I so desperately wanted.
Well, I guess I was not as good as I thought this past year. My Daisy Red Ryder ended up being a pop gun. While still a gun, it just did not have the whiz bang output that the Big Boy would have had. When I saw the dividend increase that GE posted, my heart sank. I felt like an unwanted stepchild, and it hurt. I have had big dreams for this investment, and I guess I expected more from the company that keeps saying how good things are going.
I am not saying that a 1 cent increase in my dividend is not appreciated. However, not only was it less than expected, but based on last year’s increase, it is in no way near that increase in both percent and actual cash value. It is far from it. It is also, from what I see, the lowest percent increase since the dividend was cut back during the Great Recession. A penny when the dividend was .10 cents per share was a pretty good increase, but that same penny when the dividend in .22 cents is far from expectations.
Does that make me greedy? I think not. I am just looking at the dividend in relative terms. I am looking at the increases over time, and I feel that over the past 6 years, the dividend has increased very nicely, albeit, it is far from where it was before the Recession. This increase tells me that the company is obviously seeing headwinds just around the corner. They keep talking about the global recovery. I think we went right from wating for the global recovery to seeing a potential global slowdown.
I have never really been a person to say anything about a CEO or a BOD, but I think it is time to say something. I know there are people who say that GE has seen 100’s of percent improvement since the bottom. However, that low price was, in my opinion, artificial-just like the astronomical prices of the .com era. I feel that the CEO as well as the BOD should be given incentives based on performance, but the performance should be tied somehow to stock price also. It seems that the company can manipulate numbers in any way they see fit, but it also seems that they are not fooling the investors or the analysts. The numbers should be more transparent and not so much tied to compensation at the expense of the shareholders. The shareholders ought to benefit before the Top Dogs get their cut. If they do their job, plenty of money should be available to go around. Not only does the Top Brass get the measly .01 cent increase in their dividend income, they also get huge pay packages and incentive bonuses regardless if the shareholders win or lose. It really seems unfair. The shareholders should be considered well before pay increases or incentives are handed out. If the company is not cranking out earnings, how can pay packages be increased and not slashed across the board?
It is a peculiar setup that allows these huge companies to live off of the employee’s backs as well as the backs of the shareholders. How can any company see basically a stagnant or declining value and still spend like there is no tomorrow? I know that most everything that is done at GE is very high tech and requires very talented and motivated employees. However, I bet that the top brass, who tell people what to do or pretend to do so, have pay packages that are magnitudes higher than the craftsmen who toil every day. Want to increase earning instantly? Cut the pay packages! Get rid of all the perks! Learn to drive the older company vehicles! Buy cheaper suits! I bet they don’t sit in plastic cafeteria chairs.
They talk about cutting costs. They ought to let me help them. Hey, maybe Dividend Mantra (Jason) could give them a few pointers. I think it would be possible to increase the earnings per share instantly. I know I am ranting, but I bet Jeff Immet has not had a hard day’s work in quite a while- Maybe some long days and a hang nail or two, but I can’t imagine a grinding physically worn out day. He ought to try it! It sucks! He might appreciate his pay a little more and see that, even though he is a Harvard graduate, he should consider himself lucky to work for such a massive company and receive such a high salary.
I started this rant with the title-Ebenezer! My goal was to point out that GE was the scrooge. They were the ones hoarding the cash and finding ways to line their pockets. When I got to the last paragraph above, I almost felt like I was being the scrooge. I hate that feeling. I cannot believe that I even think like that at times. However, I do have a family, and I do have dreams. I want my dreams to come true just as bad as the other guy wants his to come true. I guess I finally feel like I have had enough of the lies and the smooth talking. I guess I had to just get it out. I guess I ought to feel blessed and accept any increase and be happy it was an increase. Maybe Immelt is trying his best, and GE is going to turn the corner any time. Lots of maybes. Maybe I should give it a little more time, afterall, the Top Brass should know what they are doing.
Well, it is Christmas time. It is a time to contemplate our lives and if we are living the life that we should be living. It is a time to be thankful for what we have and to help others. I am going to take my dividend increase and be happy. However, I do feel that I might not be reinvesting all that money back into more GE shares. I am going to invest that money into some other stocks that I feel might work out a little bit better and use the money to diversify a bit. This might be a blessing in disguise. It may have been the kick in the pants that makes me move to greener pastures.
I feel quite a bit better than when I started this post. I feel like I have had an epiphany. My mind is as ease, and I feel very confident in my investment future. Although not what I expected, the dividend increase will benefit me in the future. As the prices have been falling recently, I should be able to acquire a lot more shares with my newfound income. Well, my thoughts have dried up on this subject, and the hour is late. I hope everyone in this little community we share has a wonderful Christmas and a prosperous New Year.
Robert the DividendDreamer