flannery's and the decision is super. i know that they have the man on the board. >> trying to reach mr. rden and he has not responded >> i think john flannery, he was given a bad hand the hand was far worse than people realize, whether it is frankly, other than aerospace. >> well, i guess healthcare was okay >> he was involved in the acquisition even though that was under mo >> i think he was tainted because he did check off on that that was one of the sub-optimal decisions. >> one of the discussions was whether this turbin issue was the tipping point. >> there is a lot of tipping point. you sta-- don't forget we got te two news breaks on the blades. >> carl, i don't know. i have not heard it was specific to that as much as it continues to under performance under the unit and a lot of it due to goodwill, another final poor deal that was done under the regime of mr. ml it adds up when you do it over and over >> are you surprise that -- i think it is going to look like a low price. >> the minute when culp joined, i looked at his age, he's only 55 you want to see why ge stock is up this mor

mr. flannery talked about turning around power wealth. i think the fact that it is going the other way perhaps gave pause to some board members not to mention they never conducted a search when they installed him in the job but having the presence of him on the board since the spring, he's 55 years old and probably gave them confidence perhaps they could move in a different direction and a better direction we'll see. he will remain committed or separate health care it is unclear how they are going to do it one other key point we need to make is about the future of the dividend given that impairment charge we haven't heard from the rating agencies. they may weigh in. it could put pressure on them. it would be different than what they said previously which is it would be safe until the health care split off you know, to your question it's not like investors gave him the time of day either the stock hit a nine year low. what the hope for a turn around? what does it look like >> i think the surprise for so many people has not been of the ever

mr. flannery to put in a new ceo.hatlot of is going right and what is going wrong in corporate governance right now? with respect to general electric in particular, i'm not surprised by the change. too often, companies forget how important culture is. do you accept new ideas? take outside perspective? gm, therek at ge and are some parallels and some radical differences. my personal opinion is that conglomerates no longer work. when you look at general electric you have a company that went into power, petroleum, energy, they have a jet engine business that's world-class. they just sold other medical technology business. it's the conglomerate. i don't know if you have core competencies that are transferable from one of vision to another. the board was slow to move, i thought. , whobrought in larry kulp did a hell of a job at denver -- den her. now he's going to have to inculcate a new dimension into the ge dna. it will not be easy, but culture its strategy for breakfast -- eats strategy for breakfast. if you reflect bac

mr. flannery? >> well, that's the question what we don't know we've had a number of ne-time charges. we have the $23 billion goodwill write-down and $15 billion accounting write-down last year. if all the bathwater is out, all the bad stuff is out, then mr. culp can come in with fresh eye, expectations have been reset because now we know ge will miss earnings guidance. all of that stuff is out in the open so gets to come in with that reset so gives him a chance to have a little time to get investors excited. >> this news just came out this morning and i heard you use the word "if" a lot. there are still things we don't know are you convinced that a change like this is what was needed could it move you to change your outlook? you have a hold rating on the stock. investors are certainly -- i guess maybe excited about the hope of something new based on the direction of the stock today. >> yeah, if you're buying the stock today you're buying hope, exactly that ge has been overpromising and underdelivering for quite some time write-off after write-off after write-off and what we need to s

mr. flannery, this wasn't going anywhere and it was time to shake up a culture that wasn't working i readte good note. i think the bottom line is that the bad news -- karen points out the balance sheet. i think a lot of it is on the table, short base is gone, long base is empty. >> you have to give ge credit real quick maybe they said we have a problem here and addressed it, instead of staying with something longer than they should have. you talk about culp. 37 years old one of the great companies that acquires and integrates companies better than any company out there. maybe this is a guy they should have hired in the first place 14 months ago. >> tesla taking investors on a wild ride. ceo elon musk reached an agreement with the s.e.c. >>> choose your own adventure netflix style. where do the traders see it going? find out when "fast money" returns. >>> welcome back to "fast money. tesla stocks up after ceo elon musk struck a deal with the s.e.c. >> most important thing to remember if you're an investor in tesla is that elon musk with the deal with the s.e.c. remains ceo, separate from a

mr. flannery and i think there's more to come also within this change is thomas horton, the former ceo ofmerican airlines. he's coming in as well so you've got mr. culp coming in as the first ceo in the 126-year history of ge, mr. horton coming in from outside of the company what does that mean, though? they're going to cut the dividend further i'll tell you one thing -- >> suspend for a while >> to your point, one thing i know they are going to do, they're going to focus on free cash flow generation and focus on the balance sheet which has a tremendous amount of debt. >> $100 billion. >> can you fix power among the critical questions what's going to happen there, and you owned the stock. >> we did. we sold it back in june. i think it will be positive to cut the dividend the investors that own for the dividend have been flushed out of this stock. i think there's an opportunity here this is a value play i think this is a different investor when we sold it, that was our thesis was that this was a different investor, getting rid of baker hughes, selling off health care. you're looking at it

mr. flannery to get to a decision on certain things.f different things, obviously, but it may have well been as you said this latest problem that convinced the board they needed to make a change. obviously culp is there. the first thing they point out in the press release is his incredible success. >> in his new world of technology, a source is texting me saying this was not driven by the turbine issue but was as you said execution issue, slow pace of change as it came to what was going on under flannery's leadership >> david, it's under $100 billion market cap >> i know. i know >> the guy's been there over a year it was a $98 billion -- when i saw that last week, it's just driving home how the mighty have fallen from $600 billion but you compare ge's performance over any time frame to any other index, and it blows your mind it could have been mismanaged by whomever you know it's down, like, 30% everything else is up like 300%. it's mind blowing. >> it is mind blowing. this is not a new conversation for us we had this conversation a yea

mr. flannery. it looks like he may not get huge payout. >> this is so fascinating. to it and there are so many leaders to it. you are not going to get a lot of money. the idea that they will bring in an outsider. was a radical move for them where company has struggled. story going back and reading about. david: they don't have big contracts to guarantee it. someone should get credit for having him move in. they brought him on the board. >> ge has been well-known. all the derbies that have taken place. bring in an outsider and it will danaher.sting to see they left after having a bit of the fallout. alix: les moonves get set of cbs under allegations and still gets a pay package of like $160 million. can someone explain how this makes sense? david: he had a really great contracts and i know something about that. that big payout is put in escrow right now, subject to the outcome of the investigation. i talked to somebody in the business recently who will see if he gets that money at all. fair. i think $380 million was the initial package. i get that. this is one of my

mr. flannery got really bad hand and had to do a lot of dirty work. >> but a basal flannery of $2.5 millionthe appreciation that he could get and everybody in america would like that that's a contract that if you are performance is oriented, it is the best performance oriented i have ever seen i don't think anyone seen it better >> well, listen, there are a lot of shareholders with extraordinary pleased if the stocks does arrive everyone to 18 or so and it will be roughly 15% and take it up from there, jim. >> and of course the greatest comp is danneher i think this man is not going to fill the plan. he's going to do exactly what flannery did if he's going to do exactly what he did, they would not need to fire flannery. >> he's embracing the strategy we'll see who's right, whether i am right or you're right time will tell >> i am so tired, i am not going to use the term from that company. i am going to sit back and watch. >> you look very nice today. >> this is my friday outfit. >> you are going out >> i was going to city bike later. >> where did you get this pants, target >> are they the s

mr. flannery. >> i didn't do the weighted average after flannery.x: chairman and ceo for a total of 12 months. so, what decisive action does he need to take now to reassure the markets that yes, the confidence is warranted? >> from now he has to put out a credible plan -- credible plan for each of the businesses. he is a couple of months to put together, here is where i see the steps going over the next few months. i think he has a little time to digest and look at how he can grow the business obviously, i think the health care business in particular is interesting, had made anher overture for some of those ads and that was a $20 billion purchase. it was not for the full business, just for a few assets. his strongeste of qualifications that he's from the outside? ge has historically corroded from the inside. someoneat they need is coming with a clean sheet of paper. >> i think you're right. the tests aboard versus ge board, i think this is a clear statement come a one year and on with flannery and bringing in 's leadershipulp capabilities. only him

mr. flannery, you will take those celtics tickets right now. that's about what you got.ackage. >> semi is hanging in there why the cycle looks worse than the 2015 down cycle and getting over done in the near terms by no mean in the woods >> i agree with that when you look at the pause that people have been talking about and a lot of people are saying that the pause is not going to be over this quarter or next that you will be in the middle of 2019. if you feel that will way, you should buy cisco and hpq because they're the buyers of deramps. i don't like this stock. i just don't like it you are not going to get me to turn >> you got domino's on tonight they did beat by 20 cents. domestics though are slightly below. >> allison is from overseas and did a great job. domino's, how can you keep on raising the bar and raising the bar, i think they are a victim of bar raising? we'll hear from ritch allison, he always brings me a tomato pie because he knows i don't eat cheese we'll get to the bottom of it. it is harder you can't look at the numbers and make a judgment. >> we did

mr. flannery got shortchange here he can do whatever the heck he wants and that's why the stocks are beenoing up. >> you mentioned the reporting and the note talks about that and the dividend says 75%. >> i think it will be full >> a little downside risk if they cut it in full. that's his number one piece of advice which it is going to allow him to increase the price tarpgget. >> we are spinners i don't have any problems with the spinners of the philadelphia base this is not about spinning what this is really about will is to say we are not going to throw good money after bad which was unfortunately flannery's plan he's making his move and his move is to put good money in good investment and not good money towards bad. so i think people have to start waking up to the fact that spin zone, remember the spin zone >> he has done online shows now. >> good luck to him. never watched it in terms of culp, already the stock is up 10% also in the last week >> i know. >> it is going to be paid out already. >> well, you know what -- will, one of the things that if fed ought to be worried about is the

mr. flannery's plan to unfold.long of a horizon for most investors to be patient >> what does larry culp have to do right now what is the next order of business if you cut the dividend, you say you're turning power around, how much patience does he get from the street and what do you want to see next as an investor >> well, he's not going to get a whole lot of patience. as you saw, john flannery got a year he was -- what he was doing was good it just wasn't fast enough and possibly not bold enough and what larry culp has to do is explain to us how he's going to fix power. in the current iteration of the restructuring plan, power is 50% of revenues after medical is spun off and oil and gas is sold so 50% of revenues is his poorest performing business in an industry that i think i can argue is in secular decline. he needs to tell us how he's going to fix that. >> there's a book to be written here, santoli. you can go back to the final days of welch, the selection of jeff immelt over nardelli, and then i remember all

mr. immelt says anything. the company is coming off the firing of john flannery, and the naming of lawrence culp.stay with ge stock, shares up 8%, the best week in some 3 1/2 years that tells you a lot about how ge has traded lately we want to bring in an analyst who made a big call on the stock. dean dray of rbc capital markets joins us now dean, good to have you on today. >> nice to be with you i'd like to start with i guess what's fair to say i'm a little confused i'm sure you know where i'm going to go. on september 27, said the stock has not bottomed on october 1st after they name p ed mr. culp, the ceo, you called it a outperform. >> we see a sea change at ge you go back to friday, we put out a note and said here are all the things we see that are wrong at ge that need to be fixed. here's the reason that the stock hasn't bottomed. they need to cut guidance and if you wanted to be optimistic, you could look ahead and look on the board, the lead director, we said at that time, we said this back in june and we said it in april, watch larry culp. he could turn out to be the next ge ceo and that

cleaning up guys, one day after a surprise missile of john flannery and ge's stock some of the parts for ge but given their conference and mrlp, he's taking over as ceo. we are narrowing that discount to 20% they have a $15 price target at rbc because they narrow the discount to some of the parts because they like mr. culp in terms of his ability to execute. >> why would he take the job if he thought he could not get his arms around power. i know it has been talked about. the plan that john flannery has is not edgy stuff. >> you mentioned you will look out for tusa >> and city confirms a lot of our these this that a lot of the power issues are execution >> i think tusa is waiting and he's worried and you will get dividend cut is it going to be an equity offering, we don't know? stephen tusa, he's been so right. i hesitate to say that he should change his mind. he wants to see what this quarter looks like flannery lost his jobs because he has not gotten his arms around the size of the various charges. >> right, i was reporting later in the day was when he brought in the $23 billion charge to the board and the elimination of