GE erases $42.2 billion in market cap, now what?

General Electric Company  (Public, NYSE:GE) shares hit a 12% loss today which is the worst decline for GE most since the October 1987 market crash.  $42 Billion gone.  But as bad as it may be, vultures are circling for good reason.

Parts of the international business are doing well, and the dividend yield at 3.7% is still standing, but you need to be patient.

You may be thinking the Masters need to put down the pipe, but really, were not, its not 5 PM yet.

Cut & Pasted right from their corporate website:

But don't buy GE today, it will keep falling. 

Goldman Sachs Group Inc. downgraded shares of General Electric Co. to ``neutral,'' saying the company's surprise first-quarter profit decline raises ``credibility concerns.''

From theStreet.com:

For most of 2008, the broad indices have been moving within a solid range of lows established in January and highs hit in February.

"There was a naïve attitude toward GE beforehand, obviously," said Philip Roth, chief technical market strategist with Miller Tabak. "Why should people be so shocked about this? They're a financial company."

"Still, there's maybe more to this than meets the eye," Roth continued. He said GE's numbers, which revealed global revenue rising 22% -- a robust figure, but well off the company's fourth-quarter spike of 27% -- could be evidence of decelerating international growth. If investors absorb that potential message, Roth said, the market could break below its January base.

"There's been no willingness to be believe in a global slowdown," he said, "and if that's what this message from GE means, that would be a big change for the market. I don't think we can make a bottom until fear of a global slowdown is priced in."

Masters, stay on the sidelines, wait for more downgrades to come in then in one month, Buy.  The dividend yield plus the slow recovery over 2008 will beat any one year CD rate you can find.

With all the negative press, shares could fall to $25, and we recommend pulling the trigger between $25 to $27.

DISCLAIMER: The Author has no positions in GE.