GE REPORTS Q1 $13.6B LOSS
One week after the announcement it would dismantle most of its GE Capital financing operations to focus on its industrial roots, General Electric reported a first-quarter loss of $13.6 billion. The results were impacted by charges relating to the conglomerate's strategic shift. A year ago, GE reported a first-quarter profit of $3 billion. Excluding the impact of the GE Capital sale, GE said it made 31 cents a share in the first quarter, down 6% from the same period in 2014. WASHINGTON The problem with the brinkmanship in the Greek crisis is figuring out how much of the official posturing is bluff and how much is serious.
A lot of posturing has been in evidence in Washington this week during the spring meeting of the International Monetary Fund and World Bank, which brings together policymakers from around the world.
The IMF meetings are designed to foster greater communication and consensus on how to best manage global financial risk, but statements by some of the principals involved in resolving the Greek crisis have instead fanned the flames of financial instability.
The Dow Jones Index shed more than 300 points at one point Friday partly because of concerns about Greece, and other markets were roiled by news emanating from the Washington meeting.
IMF Managing Director Christine Lagarde made headlines as her remarks at a news conference implied she would deny any payment delay to Greece on about $1 billion in IMF loans falling due next month.
Unless Greece concludes its negotiations for a further round of bailout money from the European Union, it is not likely to have the money to repay the IMF.
The actual remarks of the former French finance minister, a veteran politician, conceivably leave the door open for her to consider a delay.
She noted in response to a question about Greece that the IMF has “never had an advanced economy asking for payment delays” and that such a delay in Greece’s case was “clearly not a course of action that would actually fit or be recommendable in the current situation.”
This was still not an outright rejection of the notion, and Lagarde nimbly evaded a follow-up question seeking a definitive statement.
The dialogue of the deaf between Greece and its creditors continued later in the day.
German Finance Minister Wolfgang Schäuble, the driving force behind the hard line the EU is taking with Greece, and Greek Finance Minister Yannis Varoufakis, the colorful academic who insists that the crushing austerity policies imposed by the EU must be eased, made back-to-back appearances at the Brookings Institution.
Each insisted that he wanted Greece to stay in the euro, but each also ruled out any compromise on the core issues separating them.
It is a dangerous form of brinkmanship, because the resolve in Athens may be stronger than the EU and the IMF think.
Creditors could be forced to blink and compromise after all, enduring a tremendous loss of face, or to force a default with consequences that are impossible to predict.
Markets are right to be jittery.