Good morning.
Lots of responses to yesterday’s post on The Wall Street Journal’s GE/Immelt takedown—much of it from former GE executives. Just in time for Feedback Friday.
One ex wonders why the company’s board hasn’t suffered more: “Should be totally cleaned out,” he writes. “Not one of them has industrial experience.” There are lots of people on that board whom I admire—among them, Francisco D’Souza, CEO of Cognizant (board member since 2013); Marjin Dekkers, former CEO of Bayer (since 2012); Susan Hockfield, former president of MIT (since 2006); Peter Henry, ex-Dean of the NYU Stern School (since 2016); and Steve Mollenkopf, CEO of Qualcomm (since 2016.) Also, activist Nelson Peltz’s sidekick, Ed Garden, joined the board last year. Still, at some point, investors should hold this crowd responsible for the debacle.
Another ex-executive who thinks the current wave of GE bashing has gone too far had a two-word response: “Now oversold.” (The stock did move up yesterday, by exactly 13 cents. If it does that for another hundred days or so, the people who invested last May will be made whole!)
B.W. also thinks the criticism is excessive. “Through personal and through second hand accounts, I can tell you that Immelt is as tough and direct of a manager as there is.” He adds: “Name ONE Fortune 50 CEO right now who isn’t extraordinarily exuberant about the prospects of their business (publicly.) “
But B.B. thinks the criticism of Immelt rings true: “As a former officer of small publicly traded software company, I have seen way too many CEOs refuse to adhere to what I believe needs to be the very foundation for all leaders—HONESTY. Success theatre, getting the ‘pom-poms’ out and saying everything is great when it’s not is no way to improve performance.”
Enjoy the weekend. News below.
| Alan Murray | |
| @alansmurray | |
| alan.murray@fortune.com |
Top News
Chinese Debt
One of China's biggest insurers, Anbang, has been taken over by regulators and its chairman charged over suspected "economic crimes." Anbang has been an aggressive leveraged acquirer on the international scene, and the Chinese authorities are cracking down on excessive corporate borrowing and risk. The China Insurance Regulatory Commission said it and other regulators had seized Anbang for a year to maintain its "normal and stable operation." However, they claim it continues to be a private company. South China Morning Post
U.S. Inflation
Treasury Secretary Steven Mnuchin isn't too concerned about wage inflation and the rise in U.S. debt, which some investors think will harm the country's economic security. "There are a lot of ways to have the economy grow," he said, suggesting that wage increases won't lead to inflation in general. Bond manager Jeffrey Gundlach retorted: "Yeah, sure." Bloomberg.
RBS Recovery
The Royal Bank of Scotland, which has been majority-owned by the British taxpayer since the financial crisis, has returned to profit for the first time in a decade. Having made a £6.95 billion ($9.7 billion) loss in 2016, it reported a profit of £752 million for 2017. However, RBS may still face a huge fine from the U.S. Justice Department over the mis-selling of mortgage-backed securities. BBC
Minis in China
BMW intends to build some of its electric Mini cars in China, in a newly-announced deal with Great Wall Motor. The company says it will still assemble the first electric Minis at its Oxford plant in the U.K., with German-made electric motors. BMW already has a Chinese joint venture that's been running since 2003. Electrek
Around the Water Cooler
Mueller Charges
Special counsel Robert Mueller has filed more criminal charges against former Trump campaign chairman Paul Manafort and his associate Rick Gates. A new 32-count indictment alleges that the pair perpetrated tax evasion and bank fraud in order to fund lavish lifestyles. This is all on top of a 12-count indictment that would already see them behind bars for a decade or more, if convicted. TIME
Nissan's Self-Driving Taxi
Japanese carmaker Nissan is set to test a self-driving taxi service in Japan, in partnership with tech firm DeNA. The "Easy Ride" test, which suggests competition for the self-driving taxi plans of Uber, is scheduled to take place on March 5. Participants will tell the car where to go using the Easy Ride app, via text or voice command. However, Nissan and DeNA only plan to launch the service to the public in the early 2020s. CNBC
Snap Judgement
What a difference a tweet can make—when reality star Kylie Jenner told her Twitter followers that she no longer opens Snapchat, app owner Snap saw its market cap fall by more than $1 billion. Jenner was one of Snapchat's most high-profile users. Like many others, she is unhappy with the company's decision to separate stars from the plebs in a major redesign. Fortune
Haiti vs. Oxfam
The British charity Oxfam may no longer operate in Haiti, at least for the next couple months. The Haitian government suspended Oxfam's operations due to a scandal over sexual misconduct in the country by some of its employees. Oxfam's former Haiti director Roland van Hauwemeiren was accused of hiring prostitutes on the charity's property in the wake of the 2010 Haitian earthquake, and an internal report suggested that three staff members "physically threatened and intimidated" a witness. CNN
This edition of CEO Daily was edited by David Meyer. Find previous editions here, and sign up for other Fortune newsletters here.
