GE matches reduced expectation and people cheer

Maybe the economy is not quite ready to fall off a cliff quite yet, though it appears to be heading in that direction. At least, that's the message this morning coming from Dow stalwart General Electric Co. (NYSE: GE).

General Electric, whose shares have been pounded lately because of concerns about its financing unit, today reported an in-line quarter.

In a press release, GE Chief Executive Jeffrey Immelt, whose job may be in jeopardy, pointed out that the conglomerate was "on track" to meet its revised -- reduced -- guidance issued September 25. He also pointed out, "We have taken a number of steps to protect investors from the downside risk in financial services, and we have ways to mitigate potential disruptions in infrastructure and media markets, but the environment remains challenging."

GE also plans to sustain its dividend through the end of next year.

"We have big backlogs, great products, stable service revenue, strong operating discipline, an unmatched global position and multiple revenue streams. As a result, the Company is well positioned to perform in a very difficult environment, and our Board has approved our plan to sustain the GE dividend through 2009," Immelt said.

Despite the positive spin, the results were pretty dreadful. Profit from continuing operations fell 12 percent to $4.48 billion, or 45 cents a share, from $5.11 billion, or 50 cents. Many businesses including Global Finance fell by double-digit percentage points. Cash flow from operations plunged 18 percent during the first nine months of the year.

How sad is it that meeting reduced expectations is seen as great news?