With American car maker General Motors filing for bankruptcy, the Dow Jones company – which puts together the eponymous industrial average to gauge the strength of the stock market and, in turn, the U.S. economy – had to yank GM from the DJIA index this morning. GM will be permanently removed from the index, as it turns out, and on June 8, it will be replaced by networking maker and server wannabe Cisco Systems.
In an interview at the Wall Street Journal’s online site, John Prestbo, the executive director in charge of the Dow Jones indexes, explained that removing GM from the ranking of the 30 industrial companies was automatic, since the company does not allow bankrupt firms in the indexes. Prestbo explained that Dow Jones sees Cisco as transformative to American culture and business, like the car was at the beginning of the last century, and referred to the maker of networking gear as the “pavement of the information highway.”
Times change. But Silicon Valley needs to watch out. The Washington types have their eyes on you too.