Hardball College Tour: Jack Welch
UNIDENTIFIED MALE: Jack, what’s your take on when this economy is going to turn around?
WELCH: Well, I don’t think this economy in general is so bad. I think that you have a telecom shut down, you have a high tech slowdown, you have a lot of capacity. So you got weak pricing power.
For example, the GDP in the third quarter was up four percent. That normally would be considered pretty good. The normal GDP was only up five. That means you got one percent price. You’ve got globalization. You’ve got global capacity everywhere. [...]
There are plants all over China that just built 20 million things that are coming in to this or that, so pricing pressure is what we’re facing. The reason why jobs are tough is not volume. The reason why jobs are tough is there’s no profitability.
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