Corporate profits have slowed in Q3, and U.S. economic growth most likely slowed in Q4 as well, but analysts say talk of a recession may be slightly premature.

Corporate profits fell to an annual rate of $19.3 billion in Q3 as domestic earnings dropped by $41.2 billion, according to U.S. Commerce Department data. The U.S. economy is being hurt by sluggish retail sales and write-downs in the subprime mortgage sector; the two have been offset by strong earnings abroad, but the domestic side may outdo the international side in Q4.

"The earnings recession has already arrived,'' said David Rosenberg, North America economist for Merrill Lynch (NYSE: MER) in New York told Bloomberg News. "We are going to see an economic recession in '08.''

The Institute of Supply Management's manufacturing index for November 2007 totaled 50.8, above the consensus estimate, but slower than October 2007's reading of 50.9. Any reading above 50 indicates economic expansion.

• OBITA increased 18%
• First quarter bookings hit the $5 billion mark, over $55 million every day
• European leisure business grew over 30% with revenue hitting $1 billion
• Free cash flow was $606 million and shares outstanding decreased by 11% during the past year due to big share buybacks

Friday was a fascinating day for General Electric Co. (NYSE: GE); the shares were actually up $1 and trading volume was at 91 million shares, nearly triple the usual amount. The hoopla started when Citigroup research mentioned that GE should be broken up and spun off into separate companies. It's about time.

I have been writing about the possibility of GE splitting up for the past year for members of my website. It only makes sense. The problem with General Electric is that it has too many moving parts to properly predict consistent growth. GE is expected to generate revenues of $176 billion this year, with earnings per share of $2.22. For 2008, early consensus is for revenues of $196 billion and earnings per share of $2.48, barely a 10% increase over 2007.

Revenues are growing at slightly less than 10%. The 10% number is a magical number for Wall Street. If a company falls under that benchmark, serious questions about strategy and direction need to be asked -- and answered. Jeff Immelt, CEO, has been under the gun recently as the shares of GE have plodded along for the past six years in a narrow trading range. The bottom line is that there has been minimal growth for shareholders, but a decent dividend -- currently at $1.12, for a 3.1% yield.

GE has a market capitalization of $378 billion and is one of the most successful companies in the world. No question, investors who have owned the shares these past 20 years have been superbly and amply rewarded. The Jack Welch era saw skyrocketing growth of revenues and earnings, not to mention many new management principles crystallized in his books.

That was then -- this is now.

The Commercial Finance division of General Electric Co. (NYSE:GE) is proposing a buyout of Japan's Sanyo Electric's (Other OTC:SANYY) credit operations for a cool $1.1 billion in cash. The board of Sanyo is recommending to the shareholders the acceptance of this deal. For GE, it is the smart move.

General Electric is a hugely diversified company with products ranging from light bulbs, aircraft engines, medical imaging equipment, kitchen and laundry appliances to water processing to media -- with its ownership of the NBC Network. GE has had a difficult time posting up growth numbers since CEO Jeff Immelt took the reins from the legendary Jack Welch some seven years ago. Welch was certainly in the right place at the right time and guided GE for a couple of decades as this company became one of America's largest corporations. Along the way, shareholders were amply rewarded by holding this stock.

The past few years have seen GE stall out and the shares have been a subpar performer. From early 2002 to present, the stock has been range-bound between $39 and $26 -- not exactly enamoring the long-term shareholders. Also, because of GE's massive presence in the S&P 500, institutions must own the shares. The pressure has mounted on Mr. Immelt to grow this companies earnings.

General Electric seems to be focused on the financial divisions to grow the earnings line more aggressively, and they are correct to do so. The GE Commercial Financial division has over $230 billion in assets and operates in more than 100 countries worldwide. There is leverage in this division that somehow the light bulb division will and cannot match. GE is acting more and more like a commercial bank, and with commercial bank margins. Using its mighty cash position and the currency of its shares, GE needs to acquire more assets in the commercial/consumer lending area if it expects to attain a solid 10% growth in revenues and earnings.