GE Capital was a different creature, riding the line of fraud in some ways. They misapplied accounting rules and had to write down or capitalize over $20B for long term care insurance.
That's what brought them down, but that could bring down anyone. My point is that vendor financing turns non-finance companies into finance companies, and brings along a huge can of worms.
That’s fair. You become vulnerable to a guy like Jack Welch.
The vendor financing stuff I saw (as a junior / intern at a supplier) in those days was a reflection of that culture. They’d lease capital equipment through GE Capital, and pack it with other stuff to the limit of their accountants appetite for risk. (You can usually roll 20% of the value into services or peripheral stuff) I remember one deal where we had to run around and buy office supplies and tools with a corporate card. I did 4 Honda Civic of laser toner.
GE was reporting their own capital equipment and office supplies as revenue on the Capital side. :) But that is penny ante stuff in terms of what they did.
The AI stuff is a shady variation of that, but likely far worse as we’ve fired all of the watchers.
I don't know the full the history of this story, but I honestly wonder if type of scandal is still possible in the United States. After Enron and Worldcomm, the US introduced Sarbanes-Oxley reporting regulations. Additionally, after the Global Financial Crisis of 2008/2009, there was a dramatic increase in regulations for banks (of all kinds) and insurance companies.
GP said:
> there was a dramatic increase in regulations for banks (of all kinds)
and if I can deposit funds, make "investments" (gambling or not.. to me most stock investments are gambling anyway since they pay out in dividends based on quarterly profits) and withdraw money, that is at it's core a bank.
However, in these and many other cases they are now effectively unregulated ones. Partly because the executive branch responsible for said regulations have their hands in the pie.
>and if I can deposit funds, make "investments", and withdraw money, that is at it's core a bank.
Not according to pretty much all countries. When a depositor is making investments, that is called a brokerage, not a bank. But these gambling websites are not making investments either.
Also, with the transition to digital currency, banks don't really have the same purpose anymore of storing and guaranteeing people's access to their money, now that money is entries in a digital ledger and there is no risk of losing the money (outside of political risks where someone edits the database). They have been obviated, but the system persists.
>most stock investments are gambling anyway since they pay out in dividends based on quarterly profits
This is not true, publicly listed companies' boards regularly choose to vary dividend amounts based on longer term cash flow, and you will be sorely disappointed if you are expecting dividends to land in your account as a function of quarterly profits.
And how do you expect a business to work if it did not vary dividends? No business knows the future, and dividends are the same as owners paying themselves a profit, so if owners do not know how much profit there will be in the future, how can dividends be a "known" quantity? They have to be based on profits, they literally are the owners distributing the profit amongst themselves
Any venture in life is gambling, just like people exploring the oceans and traversing continents without knowing what was ahead of them was gambling. But that is a different type of gambling than risking money with no effect on the outcome such as on the aforementioned gambling websites and casinos.
The POTUS kids are players in Polymarket and Kalshi, and are running crypto grifts.
The SEC fired most of their investigators, hasn’t appointed members to key boards, and cancelled most of their contracts with FINRA. (Which has laid off a ton of people) Nobody is watching.
So there’s an open season for normal corporate bullshit, and if you’re personally committing felonies attributable to you, you make sure you do it in Florida, and pay a vig to the library fund for a pardon.
We’ll have a fun run, then everything starts exploding in mid 2027-2029.