As stock market gains have grown more dependent on a handful of tech companies, financial pundits are discussing the possibility of a tech bubble rivaling the one that collapsed in 2000.
Jeffrey Immelt, chief executive officer of General Electric, disputes the idea that the tech sector is overvalued, in a commentary on Business Insider
“There has been talk of a bubble going back to 2011 and it continues to rage today,” he writes. “This line of thinking ignores the immense value that digital technologies have already created in the consumer world: the "app economy" alone is worth an estimated $300 billion.”
He also points to innovations in the industrial sector that will transform the global economy in many ways.
“The next big wave of innovation won't be new on-demand services or video streaming,” he says. “It's time to apply the same energy to solving big challenges in healthcare, infrastructure, power and transportation.”
Immelt foresees rapid development in the “industrial app economy” that will make people more productive.
“The machines that build, power, cure, and move our world are becoming more powerful and brilliant with software,” he says. “We can now create a "digital twin" for every engine, every turbine, every MR scanner. Through data modeling of physical assets, these machines can be continually tuned, continually upgraded and made more valuable in a scalable and adaptable way.”
Immelt said this industrial internet will create thousands of good-paying jobs.
“Within a decade, the Industrial Internet will be worth more than twice the consumer Internet, and a new breed of digital industrial companies will deliver faster innovation and growth than industry has ever seen before,” he says.
Immelt also is confident in his abilities to craft his company into an industrial powerhouse – and he thinks investors would be savvy to agree with him.
"When I look at the next three years, the GE team knows exactly what we have to do. We've got all the tools to do it with, and I think from a capital allocation, earnings growth, organic growth standpoint, we are a good bet for investors right now," Immelt told CNBC’s Jim Cramer
Cramer said the company has taken several steps to transform itself from a largely financial company that made turbines, engines, locomotives and MRIs, back into a fast-growing industrial powerhouse with very little banking exposure, as it has sold off $126 billion in assets from its GE Capital business.
"GE is transforming itself into a leaner, more focused, and easier to analyze company," the "Mad Money" host said.
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