Survival of the fittest is probably the animal kingdom’s most dominant theme. Survival of the fittest is also a concept well established on Wall Street; just ask Bear Stearns, Washington Mutual, or CIT Group.
Every major business cycle has winners and losers, leaders and laggards. The players change, the cycles change or reverse, but the concept remains the same.
Towards the middle of the 20th century, industrial and manufacturing type companies led the stock market to new highs. Technology stepped up to the plate as the U. S. started to lose their status as a manufacturing powerhouse.
After the dot.com bubble, engineers took over – financial engineers. The metamorphosis of GE aptly illustrates this change. From manufacturing tangible items like refrigerators and turbines, GE transitioned into high finance. GE’s slogan changed from “bringing good things to life” to “imagination at work.”