As a Disney (NYSE: DIS) shareholder, the High School Musical juggernaut is important to me. It means money for the company. It means a point of distinction for Disney that adds value to its content and differentiates it from other media businesses such as News Corp. (NYSE: NWS) and Time Warner (NYSE: TWX). It means that tweens have something realistic to relate to that reflects their own days of breaking out in song while walking through school (okay, that was a joke).

But I was disappointed to hear that a reality show extension of the brand is having a tough time in the ratings. According to this blog post at The Hollywood Reporter, the show, called High School Musical: Get in the Picture, had the worst ratings on Monday night. It's some sort of competition show with a prize related to being in some sort of video in the Musical franchise.

I'm not sure of the specifics, but my main concern is that it couldn't offer any competition to CBS (NYSE: CBS) or General Electric's (NYSE: GE) NBC. Remember, Disney's big model is to take its content and spread it around to enhance the value of the company's other platforms. It's all about the synergy. Unfortunately, it didn't work this time. I honestly thought that ABC would have seen huge numbers from the kids on this one. It makes me wonder if Musical might be getting long in the tooth.

I sure hope not, because the theatrical version will be coming up this October. I want at least one more hot project to be derived from the franchise before it heads for the fad graveyard and becomes just another mention on a VH1 I Love the 00s program. Camp Rock will hopefully pick up the slack as Musical and Hannah Montana start to hit their respective death phases.

I'm not saying that the dismal ratings performance for this reality show means that Musical is done for just yet. All I'm saying is Disney has its hands full in terms of incubating more fads for shareholders.

I own shares of Disney and GE; positions can change at any time.

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It just doesn't cease to amaze me how some people have the nerve to ask for certain perks in addition to their very fine salaries and severance pays. Here are some more examples:

• Hanmi Financial (NASDAQ: HAFC) President and CEO Dr. Sung Won Sohn requested and got a 2005 Mercedes Benz 430S, as well as the transfer of his membership to the Wilshire Country Club and the Jonathan Club. This was in addition to his $1,298,000 lump sum retirement pay.

• 24/7 Real Media (which was acquired by WPP (NASDAQ: WPPGY) last year) executive Christopher J. Wagner had in his severance agreement two round-trip plane tickets between the United States and Switzerland. He also asked for his used NEC computer and his existing mobile phone. Plane tickets? A used computer? A phone? Would you ever dream of asking for these when "retiring?" And don't forget, that's in addition to retirement pay and stock options.

• Mannatech (NASDAQ: MTEX) agreed to give its retiring chief legal officer -- apparently at her request -- her office furniture. Was she planning to open a home office? Was she emotionally attached to "the executive desk, executive chair and two side chairs" specifically mentioned in the filing? She also got the company car. Of course, that was beside the $10,000 a month compensation she received for consulting for a year after the retirement.

• Syniverse (NYSE: SVR) chairman and CEO G. Edward Evans stepped down from the role of CEO but stayed as chairman until the end of the year. His sweet deal? He continued to receive the same salary, despite the company paying another CEO already. Evans also asked to have the company plane, but at least in this case, he agreed to either assume the lease on the plane or buy it outright. Of course, I doubt he would be paying full price, but, hey, it's something.

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Bloomberg News reports that General Electric Co. (NYSE: GE) has cut a deal with Mubadala Development Co., a fund owned by the government of Abu Dhabi, which will yield $8 billion in capital to invest in financial services assets in the Middle East. Mubadala also plans to become one of the 10 biggest investors in GE stock through open market purchases. Depending on which assets they buy, this could be good news for long-suffering GE shareholders.

Bloomberg reports that GE and Mubadala will each contribute "$4 billion in equity over three years to the fund, aiming to reach $40 billion in assets." But today's partnership is more modest. Bloomberg reports that GE will also invest "$50 million in Masdar's Clean Tech fund, while Mubadala will invest $200 million in GE Industrial Investment Partners, a new program to provide development money to health-care, energy and transportation industries."

The benefit for shareholders will be longer term, if at all. That's because GE did not change its forecast for 2008 as a result of the announcement -- in April GE CEO Jeff Immelt predicted earnings may rise "zero to 5 percent, to $2.20 to $2.30 a share in 2008." At this point, it looks like GE's biggest earnings growth opportunity is in the oil rich regions of the world and those developing nations, like China and India, where that oil is being consumed.

Today's deal looks like it will increase GE's exposure to these opportunities.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He owns GE shares.

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Time Warner (NYSE: TWX) bombed earlier in the summer with a movie called Speed Racer. If you said you didn't see that one, I wouldn't be surprised. However, in the interest of cosmic balance, the media company scored with its new Batman flick, The Dark Knight. And when I say scored, I mean it. The film is estimated to have taken in about $155 million over the past three-day weekend at domestic theaters, according to Boxofficemojo. If this estimate holds, then it represents record business. Spider-Man 3 currently holds the three-day record of $151.1 million.

Mamma Mia!, distributed by General Electric's (NYSE: GE) Universal didn't come close to the Bat. It came in second with around $27 million. Hancock from Sony (NYSE: SNE) was third with $14 million, and it will be crossing the $200 million mark in about a week or so. Time Warner's Journey to the Center of the Earth was fourth, while Universal's Hellboy II: The Golden Army was fifth. That film took a steep 70% drop compared to its debut-weekend performance. I didn't think it would fall that far, but I suppose the Batman juggernaut left it no choice but to step aside. It took in a weak $10 million for the weekend.

I have one criticism for Knight, purely from a financial/shareholder perspective. I see that the run time for the movie is two hours and thirty minutes. Have studios figured out yet that shorter movies yield less risk? Sure they have. Then, the question is, why do they allow it? Films need to be as short as conceivable. It allows more scheduled showings, it reduces budget bloat and it's more attractive to time-strapped patrons.

Obviously, Knight is performing way beyond expectations. In fact, I read that some theaters scheduled extra screenings to keep up with the movie's popularity. Nevertheless, in my opinion, studios such as Disney (NYSE: DIS) and News Corp. (NYSE: NWS), as well as the ones already mentioned, need to focus on films with minimal run times. Although I can't say with scientific certainty, it feels as if the movie industry has been doing this lately anyhow.

However, what happens if you try to tell an auteur like Christopher Nolan (Knight's writer/director) that his project needs to be a certain length? I'm sure all hell breaks loose. When needs for high returns on capital collide with creative artists, studio heads oftentimes cave, proving that there's no shortage of wimps in Hollywood...

Disclosure: I own Disney and GE; positions can change at any time.

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The Blackstone Group LP's (NYSE: BX) $930 million purchase of GSO Capital Partners early this year didn't get much fanfare. But so far, it looks like a stellar deal.

Simply put, GSO is a hedge fund that's focused on distressed debt. Of course, with the slowing economy, GSO is in a prime spot to capitalize on some nice opportunities.

But there is more. Basically, GSO has become a key source of buyout financing (this is according to Bloomberg.com).

For example, when the Weather Channel was up for sale, it was tough to get financing for the deal. So why not GSO?

It worked. In the end, Blackstone and Bain Capital teamed up with General Electric (NYSE: GE) to pull off the acquisition. As for GSO, it provided higher-risk mezzanine debt financing.

Of course there are issues. After all, Blackstone has a conflict. But at the same time, the financial markets are mired in a credit crunch. So, if there are essentially no alternatives, GSO is probably going to provide the best offer.

More importantly, Blackstone realizes that there are some juicy opportunities right now. Thus, by having the GSO advantage, Blackstone certainly is positioned nicely.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

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So, the past few days have been cool ones for the Dow Jones Industrial Average Index. The market saw a nice uptrend. Click here and set the Dow to the one-month timeframe; that graph says it all. It looks like things may be okay from now on, right? Well, don't bet on it. CNBC.com reminds us about the dreaded bear-market rally. And I completely agree with the thesis: we are most likely headed back down once this market happiness runs its course.

It would simply be too easy for investors to have seen the bottom. No way, not with all the problems going on in terms of inflation and financial disasters. Oh yeah, oil has retreated, that's true, but I don't think the energy monster is in permanent hibernation. Not by a long shot. The problem with the past few days is that it plays with investors' emotions. It's played with mine, certainly. I haven't bought a stock in a while, and I really want to buy something. Maybe add to my General Electric (NYSE: GE) trade, my Coca-Cola (NYSE: KO) holding. I love the dip in Microsoft (NASDAQ: MSFT) and really want to get serious about grabbing shares in Mr. Softy. My 401(k) has a lot of money waiting to be put to work. I want to transfer some of those monies into one or two of the quality mutual-fund offerings at my disposal. I can't stand having money tied up in stable-value instruments.

I just can't make a move yet. I feel that lower prices will be upon us sooner rather than later. Already, many are talking about buying opportunities for oil futures, and I fear those who hold such opinion will turn out to be correct. When oil rises again, stocks will most likely fall, and this summer fun will be just another memory of a day at the beach. I'm not saying there aren't buys out there. Again, Microsoft is looking attractive. Value investing, however, isn't. It's not the style of the day. And when value investing isn't the style of the day, your only hope is to become a deep-value investor and pray that patience is eventually rewarded.

Am I being pessimistic? I'm being realistic. The economy is still unstable. Even the great Google (NASDAQ: GOOG) isn't immune. So, while I can't say I won't nibble here and there on some stocks next week, I can say what was I feeling most strongly as I saw the Dow climb: maybe it's time to buy the DXD (AMEX: DXD) ETF to short the index. It would be risky to do this, of course, but my main point is that I still feel bearish on the Dow even with the recent rise.

Disclosure: I own Coke and GE; positions can change at any time.

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There will be five superheroes competing for the attention of weekend moviegoers come Friday. There's Marvel Entertainment Inc. (NYSE: MVL)'s duo Iron Man and The Incredible Hulk, Sony Corporation (NYSE: SNE)'s Hancock, General Electric Corporation (NYSE: GE)'s Hellboy (distributed by GE's Universal), and Time Warner, Inc (NYSE: TWX)'s Dark Knight. So, who's going to be the ultimate crime fighter?

I'll tell you which one prevails: Time Warner and its new Batman film, The Dark Knight, has the weekend all locked up. This is set in stone. The Hulk and Iron Man are pretty much done, Hellboy isn't a powerful enough brand name, and Hancock didn't deliver the big numbers I thought it was capable of during its debut weekend (since then, however, the movie has held up well, I have to admit). But you can bet that Dark Knight hits $100 million this weekend. Can you feel the buzz surrounding this blockbuster in the wings? I can. Several reviews I've read were full of cinematic worship for this new entry in the franchise, with special praise reserved for the late Heath Ledger and his portrayal of the fiendish nightmare known as The Joker. There's a decent marketing campaign behind the project, including promotion of the availability of IMAX (NASDAQ: IMAX) screenings. If there ever seemed a movie fit for Imax, this is it. Yeah, Dark Knight can't lose, it can only win big.

Of course, what about Time Warner's stock? It could certainly use a superhero right now, as it has been hovering in recent times not above Gotham City (although that would probably be treacherous enough) but above 52-week-low City. I can't say that a big opening weekend definitely won't move the stock a little just due to the excitement factor, but I wouldn't buy the company ahead of the film (I also wouldn't gamble with IMAX either). Time Warner simply is too large to be affected significantly by one movie. If you consider Time Warner at all, it would be for fundamentals and valuation (I think the company is cheap here, although with this market, I'd rather get it cheaper). Enjoy the movie first, think about the stock later...

Disclosure: I own GE and Marvel; positions can change at any time.

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Microsoft (NASDAQ: MSFT), a competitor of IBM (NYSE: IBM) and Google (NASDAQ: GOOG), will report its earnings for the fourth quarter on Thursday. According to Trey Thoelcke's earnings summary, the software giant will be expected to produce sales of about $15 billion on earnings per share of 47 cents. These numbers would represent double-digit growth rates for each metric.

According to this estimates page at AOL Finance, Microsoft has cultivated a reputation for being reliable when it comes to delivering on Wall Street expectations. It certainly has the assets to keep this trend going. The company's operating-system monopoly, as well as its incredible success with the Office suite of products, guarantees a steady stream of cash flow and bottom-line predictability. Other investments, such as the Xbox 360 and the company's various Internet properties, aren't as guaranteed. In fact, Microsoft has engaged a very strange battle (strange to me and others, at least) to buy Yahoo! (NASDAQ: YHOO) to bolster its future prospects on the 'net.

So, here's what investors should be looking for. I will be very interested in what management has to say about its thoughts regarding Yahoo! and its utility for Microsoft. Is it an absolute necessity? I doubt it, and I really do hope that shareholders will finally get some closure on this subject. The best thing would be for Microsoft to announce that it is done with the portal. And in terms of the Xbox 360, I would be interested in hearing any new marketing strategies being readied for the holiday season and if the current recessionary environment will have any effect on sales. Microsoft recently reduced the price for one Xbox 360 model as a way of increasing that system's value proposition in relation to the Sony (NYSE: SNE) PlayStation 3 and the Nintendo (OTC: NTDOY) Wii. The company also has entered partnerships with General Electric's (NYSE: GE) NBC Universal and Netflix (NASDAQ: NFLX), according to Variety, to make its Xbox Live asset even more attractive to users looking for cool content such as movies and TV shows.

Here are my thoughts on the earnings. We won't see a miss most likely. This won't be a GE-type debacle. Earnings will probably be beaten slightly. I doubt we'll see any kind of blowout. With the stock much closer to its 52-week low than its 52-week high, do I think that there is an earnings trade of any kind here? I emphatically don't. For me, the market is way too bearish to step in front of the earnings. Yes, I could imagine the stock rallying for one reason or other, but the risk-reward scenario doesn't feel right to me. Microsoft has easily been an earnings trade in the past, but presently, I wouldn't take the gamble of an oil spike ruining the Dow on the day that Mr. Softy -- itself a Dow component -- reports.

In conclusion, I don't expect too much of a difference between analysts' estimates and actual numbers. I wouldn't get cute with trading the stock before the report. If you're a long-term investor and the stock for some reason gets punished once the data points are released, you could take that as a buying opportunity. Shorter-term traders need to be wary.

Disclosure: I own GE; positions can change at any time.

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General Electric (NYSE: GE) didn't see a huge reaction to its earnings on Friday. I think the stock closed up by only a couple pennies. But at least its NBC Universal asset scored a hit with Hellboy II: The Golden Army. According to Boxofficemojo, it topped this weekend's domestic box office with a gross of more than $35 million. Sony's (NYSE: SNE) Hancock, however, is close. That film was in second place with a haul of $33 million. By the time final figures are out, Hancock could find itself in first place, but I doubt that's going to happen. This really seemed to be Hellboy's weekend. I have to say, though, that Hancock did much better than I thought it would for its second weekend at bat. The film will easily pull in over $200 million, maybe $250 million, before all is said and done.

Time Warner's (NYSE: TWX) Journey to the Center of the Earth 3D was number three with over $20 million. Not a particularly great debut, I don't expect too much action in the coming weeks from this one. Now, Wall-E is an important project for Disney (NYSE: DIS) shareholders since it is another effort from Pixar. Investors are still trying to figure out if the price paid for Pixar will be ultimately worth it. Wall-E is doing pretty well; it came in fourth over the weekend, and its total box-office take so far is about $162 million. Incidentally, Eddie Murphy failed horribly with his film Meet Dave. The movie, from News Corp. (NYSE: NWS), came in seventh with a little over $5 million. I didn't even know it was in the marketplace.

GE and Universal scored again at the multiplex with Wanted, which came in fifth. Its cumulative gross is now more $110 million. See that? GE can leverage quality content to bring in the revenues. If NBC Universal can synergize better with hits like these, then perhaps there won't be such pressure in terms of dumping the asset. For now, though, NBC Universal is a show-me division, and it better keep the hits coming to placate the board.

Disclosure: I own Disney and GE; positions can change at any time.

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Before the bell: Solid opening expected following Fannie/Freddie gov't plan; BUD takeover

FedEx (NYSE: FDX) may be in talks to buy its rival European rival TNT, according to a report from the Financial Times. TNT shares have jumped 25% in Europe.

General Electric Co. (NYSE: GE) announced Monday it will supply parts for Gulfstream Aircraft Corp.'s G650 business jet in a deal worth potentially more than $100 million. Separately, GE said it would develop with Safran SA a new line of fuel efficient jet engines to compete with United Technologies Corp. (NYSE: UTX) Pratt & Whitney.

Apple Inc. (NASDAQ: AAPL) may have sold as many as 425,000 of its new 3G iPhones in the first three days after the handset made its debut, in line with projections and despite serious technical and activation problems. Apple and AT&T (NYSE: T) sold a combined 225,000 in the U.S. Gene Munster of Piper Jaffray & Co. predicts Apple will sell 4.08 million this quarter.

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Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Alcoa Inc. (NYSE: AA) Q2 earnings decline on materials costs but beat analysts estimates (see transcript).
• Apollo Group Inc. (NASDAQ: APOL) solid Q3 results were accompanied by a share buyback program.
• Boeing Co. (NYSE: BA) warned that Q2 results will include a delay-related charge of 22 cents per share.
• Cash America International Inc. (NYSE: CSH) predicted Q2 earnings above previous guidance.
• EZcorp Inc. (NASDAQ: EZPW) predicted better-than-expected Q3 results due to strong sales.
• Family Dollar Stores Inc. (NYSE: FDO) beat Q3 expectations and raised its Q4 guidance.
• Flow International Corp. (NASDAQ: FLOW) swung to a better-than-expected Q4 profit on strong demand.
• General Electric Co. (NYSE: GE) reported mixed Q2 results and offered an uninspiring Q3 outlook (transcript).
• Helen of Troy Ltd. (NASDAQ: HELE) Q1 results were colored by write-downs and other charges.
• International Speedway Corp. (NASDAQ: ISCA) Q2 earnings soared while revenue slipped.
• Levis Strauss Q2 profitability plunged due to declining sales and higher administrative costs.
• Marriott International Inc. (NYSE: MAR) topped Q2 estimates but lowered its guidance (see transcript).

• Merck & Co. (NYSE: MRK) was downgraded by a UBS analyst due to its earnings prospects.
• Nordstrom Inc. (NYSE: JWN) lowered its Q2 guidance after slow June same-store sales.
• Office Depot Inc. (NYSE: ODP) decline in same-store sales cast doubt on its Q2 earnings forecast.
• Pepsi Bottling Group Inc. (NYSE: PBG) posted solid Q2 results that beat earnings expectations.
• PriceSmart Inc. (NASDAQ: PSMT) Q3 earnings more than doubled on higher revenue and a settlement.
• QLogic Corp. (NASDAQ: QLGC) boosted its Q1 guidance, resulting in an analyst's upgrade.
• Rocky Mountain Chocolate Factory Inc. (NASDAQ: RMCF) posted Q1 results without full-year guidance.
• Ruby Tuesday Inc. (NYSE: RT) forecast full-year earnings 40% higher than Wall Street estimates.
• Wachovia Corp. (NYSE: WB) warned of a larger-than-expected Q2 loss as it introduced its new CEO.
• Wal-Mart Stores Inc. (NYSE: WMT) raised its Q2 guidance after strong same-store sales in June.
• Wolverine World Wide Inc. (NYSE: WWW) reported its 24th straight quarter of record profits.

The earnings crunch begins again next week. Among the many companies scheduled to report are Citigroup Inc. (NYSE: C), Coca-Cola Co. (NYSE: KO), Delta Air Lines Inc. (NYSE: DAL), eBay Inc. (NASDAQ: EBAY), Gannett Inc. (NYSE: GCI), Google Inc. (NASDAQ: GOOG), Harley-Davidson Inc. (NYSE: HOG), Intel Corp. (NASDAQ: INTC), Johnson & Johnson (NYSE: JNJ), JPMorgan Chase & Co. (NYSE: JPM), Mattel Inc. (NYSE: MAT), Microsoft Corp. (NASDAQ: MSFT), Safeway Inc. (NYSE: SWY), United Technologies Corp. (NYSE: UTX), and Wells Fargo & Co. (NYSE: WFC).

Visit AOL Money & Finance for more earnings coverage.

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DJIA: 11,100.54 down 1.14%

S&P 500: 1,329.60 down 1.10%

NASDSAQ 2,239.08 down .83%

And, the 52-Week Low Club

Early in the day, rumors that a government bailout might destroy the value of the common stocks of Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) sent the shares down almost 50%. Comments by the government and an offer by the Fed to provide short-term funds to the firms helped, a little. At the close, FNM was off about 22% and FRE was down about 3%.

The only good news, and it was barely good news, was that General Electric Corporation (NYSE: GE) had EPS equal to Wall Street's estimates and kept its guidance for the year. Its shares were barely up and still trade very near a multi-year low.

Anheuser-Busch (NYSE: BUD) shareholders were lucky. InBev raised its bid for the beer company to $70 and that pushed BUD up over 8%.

Ford Motor Company (NYSE: F) made a brief rally of 5% on news that it was getting a tax refund of $433 million from the government. It still cannot sell a single car, so the improvement in the share price probably will not hold more than a day or two.

It says something very bad about the market when the only company doing well sells beer.

Douglas A. McIntyre is an editor at 247wallst.com.

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General Electric Company (NYSE: GE)
Q2 2008 Earnings Conference Call
July 11, 2008 8:30 AM ET

Management Summary

Operator

Welcome to the General Electric Q2 2008 earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded. I would now like to turn the program over to your host for today's conference, Dan Janki, VP of Investor Communications.

Dan Janki, Vice President, Investor Communications

Thank you. First of all, I would like to welcome everyone. Joanne and I are pleased to host today's conference call. The press release went out this morning at 6:30 AM with our financial information; that, along with today's presentation and supplemental financials, is available at our investor website at www.ge.com/investor. You can follow along via the webcast or you download and print the information. Today's presentation does contain forward-looking statements based on the world and economic environment as we see it today, and it is subject to change.

We will be going through today in the presentation an update on second quarter operations and financial results and our outlook on third quarter. To do that we have our Chairman and CEO, Jeff Immelt; and our Vice Chairman and CFO, Keith Sherin.

I would like to turn it over to Jeff to get us started.

Jeff Immelt, Chairman of the Board, Chief Executive Officer

Great Dan, thanks and welcome everybody. Just to go straight to the overview page, we believe we had a solid performance in a tough environment, delivering $0.54 per share in continuing operations, in line with guidance.

We were really driven by global revenue growth of 24%, offsetting a sluggish U.S. economy. Our long-term positioning of the company outside the United States has really benefited us in the second quarter of '08.

The industrial businesses, I think, actually did quite well. We had a gain on the JV of our Hitachi nuclear business in the second quarter of last year, but if you take that away, the industrial earnings growth was actually fairly strong. Infrastructure leads the way; Keith will go through more details on that later. Healthcare and NBCU were in line or slightly better than expectations.

If you look at our financial services earnings, I think particularly versus their peers they were both above our own expectations and we believe compare favorably to the broader industry. Commercial finance was up 7%, GE Money down 9%. We'll spend some time today just going through the business model of risk management, attractive origination, AAA funding, originating for our own balance sheet and we'll go through that in more details.

As we have said in the past, as we have gains we'll apply them to restructuring. We had about $300 million of gains on business dispositions in the quarter and we did about $400 million of restructuring.

The business fundamentals remain strong. We are positioned for long-term growth. We remain on track for guidance for the year of 220 to 230, and again, I think we executed well in a tough environment.

If you go to the next page, we continue to execute on our long-term strategy. We made several portfolio announcements in the quarter.

First in GE Money, you read this morning we reached agreement on disposition of GE Money, including Lake. This was something that we talked about last year. Keith will give you more details.

The private label credit card disposition is progressing. It is a good business, fundamentally strong; slower than we expected, but we believe we'll get it done.

We assigned a Europe/Santander swap of one of the commercial finance banks for some of our consumer assets in Europe.

We announced the intent to explore distribution of consumer and industrial to our shareowners. Now, we talked about appliances in May. We've received great interest in our appliance business, a lot of the strategics are global buyers. This is a tremendous strategic opportunity for them to build a strong North American operation.

However, it was our view that the total lighting and industrial business are very interwoven in the business and that a tax-free spin to our shareowners may be the best approach. Again, we'll go through that in a little bit more detail.

We closed the Hydril and Whatman transactions. These are sweet spots for our oil and gas and healthcare business and we'll continue to do acquisitions like that.

We remain opportunistic in financial services, closing the Merrill Capital deal and Citi will close in July.

We announced The Weather Channel investment with NBCU in the lead, so we continue to invest in our great media operations.

We've had an initiative called "Growth is a Process" for four or five years. That pays dividends in a slow economy like this. Our total orders remain robust at up 8% and our equipment backlog, up 25%.

I'd like to highlight just the strength in services, which I think has always been a big part of our business model. Service revenues up 18%, service orders up 19%, CSA backlog up 17%. This is high margin from the installed base and we think this bodes well for the future. Organic growth up 5% and industrial organic growth up 9%. As I said earlier, global revenue is up 24%, now more than half of our overall revenues.

From an operating standpoint, solid infrastructure margin expansion of 60 basis points. We continue to drive restructurings and we are on track for our cost goals for the year. We'll go through that in a little bit more detail. Our industrial cash flow from operating activities was up 5%, driven by working capital improvements.

Just quickly before I turn it over to Keith, some of the key operating performance metrics that we talk about. Solid growth in orders, revenues and assets, so again, even in a sluggish economy, we think our process capabilities remain very strong. Earnings that are on expectations: returns of 17.6%, margin rates of 16.4%, down 40 basis points from last year. Again, infrastructure was up, healthcare and NBCU roughly on plan.

We were really dragged down by consumer/industrial. That's really a pricing story as much as anything else. We did substantial cost out work in C&I in the quarter. And cash on plan with a very strong balance sheet and solid AAA. Again, we believe this is a solid performance in a difficult environment.

I'll now turn it over to Keith to go through some of the details.

Keith Sherin, Chief Financial Officer

Jeff, thanks. Let me start with two recent announcements. First, this morning we're really pleased that we reach an agreement with Shinsei Bank to sell our GE Money business in Japan. Some of you may have seen the announcement. This includes the Lake personal loan business that we talked about selling last year.

In addition to the personal loan business, we've expanded this transaction. It's larger than the original announcement. We've included an additional $1.7 billion of mortgage and credit card assets and Shinsei is going to take over 1,100 branches, all our employees, all the assets. With that sale -- with the additional assets and the complete sale -- we recorded an additional $200 million of charge in discontinued ops in Q2 and we anticipate this is going to close in the third quarter.

We've been working on this for quite a while. It's terrific that the team was able to execute on lightening up on consumer assets in Japan in a pretty tough environment, and Shinsei has got a win here. They really want to get into the consumer business and they've got a great platform and they really like the quality of the portfolio and the people and the systems and the team that they are getting. We are thrilled to have that signed up today.

On the right side, you've all seen the announcement on our intention to have as the primary focus on our business development the distribution of the C&I business to our shareholders. It's going to be an efficient transaction for GE and shareholders. We believe shareholders are going to get upside from being able to participate in the benefits of the entire C&I business. It's not really dependent upon M&A or equity market conditions. We will have some capital redeployment and it increases the overall company margins and long-term growth rate. We are targeting first half '09 execution. We're really pleased with the Shinsei agreement and we are starting to work on the C&I transaction.

Let me start with orders. We continue to have really strong absolute orders. On the left side, as we always show you, is major equipment. For the second quarter we had $13.7 billion of orders. That was up 4%. I've always talked about how the orders are lumpy on a quarterly basis but you can see some pretty good Vs here in aviation, energy. Transportation had a $1.5 billion order last year that didn't repeat, but their outlook for additional equipment orders is very good.

Absolute order levels at these amounts are very strong. The orders grew by 30% more than the shipments as we continue to build backlog. Just in infrastructure alone, the backlog now is over $50 billion. It's up 29% just from the start of the year, so when you talk about "How is the global economy?" I think when you look at these long cycle orders continuing to come in at these levels and exceeding shipments and building backlog, we feel like it's pretty strong and continues to remain robust.

In the middle is services. We had service orders of $9.5 billion, up 19%. It was a tremendous services quarter. You can see the breadth across all the businesses, up double-digit. Aviation was up 14%. The commercial spares rate in the quarter was $18.6 million a day versus $18.4 million, up 1%. But the overhaul was up 31%, military services were up 24%, energy service orders were up 19%. Just an incredibly broad service performance in the quarter and that bodes well for the future and it also reflects the installed base that we have built.

On the right side, as you'd expect the flow orders of $4.1 billion were down 3%. Organically you can see appliances had a tough market. Retail was down 7%, contract was down 15% reflecting housing, and enterprise solutions was up 1%. So overall orders continue to be driven by just great infrastructure demand and we continue to build more backlog.

Next is a summary of the second quarter. I'm going to then cover the industrial business and then follow with the financial business, but on the left side is the summary of continuing operations. We had very strong top line revenues of $46.9 billion, up 11%. You can see it was driven by the industrial sales, which were up 15%.

Earnings of $5.4 billion and earnings per share on a continuing basis of $0.54 with the effects of the buyback were flat. Net earnings, which included the impact of the discontinued operations that I talked about to include the exit of the Japan business were at $0.51, overall down 2%.

Our GE cash flow year-to-date is $9.3 billion. It's down 20 and I'll show you how that comes together in a few pages. The industrial cash flow, as Jeff mentioned, $7.3 billion, up 5%. Basically we don't have a repeat of the insurance dispositions from last year.

The consolidated tax rate for the quarter came in at 16%, in line with the first quarter and the previous guidance for the year. For the total year, our guidance remains in line with the 16% first half rate, about flat with last year.

On the right side you can see the business results. A great performance in infrastructure. I'll go through each of these in a few pages. Commercial finance was up 7%, better than guidance. GE Money was down 9% but also better than guidance. NBCU and healthcare came in about as expected. We had a tough quarter in industrial products, driven by C&I and that was lower than expected.

So overall, $7.6 billion of segment profit, up 7%, a very strong performance in this environment.

Next a few items that were in the businesses and in corporate around gains and restructuring. I'll start with 3 points on the left side. First, there is no repeat of the 2007 Hitachi gain, which was $500 million after tax in corporate last year, but we're comparing to that on the industrial side.

Second, we do have about $0.03 of gains in the business segment results this year. There are four items:

- Garanti founder share gain is in GE Money at $89 million after tax;

- We sold 9% of Penske, we're down to 51% ownership in commercial finance to Penske and that was $93 million in commercial finance.

- We formed a JV in water with Pentair in a very nice strategic transaction. That resulted in a gain of $52 million. That's in infrastructure.

-We sold the Sundance channel at NBCU and that was about $61 million after tax.

So those four gains that are in the businesses were more than offset by the restructuring and other charges of $400 million after tax and the details are on the right side. We continue to work on the cost structure of the company, taking out costs in C&I and commercial finance and infrastructure. We continue to reduce our footprint and streamline our organizations. We had some other items, including purchase accounting and a C&I extended warranty contract, but overall we executed $0.02 more restructuring than we had planned. This obviously continues to help us improve our earnings going forward.

Let me go into some of the industrial businesses. First is infrastructure. In the second quarter, the infrastructure results were really terrific; revenues of $17.6 billion, up 26%. Segment profit, $3.2 billion, up 24%. You can see the key business results down the left side. In the box on the bottom left, you can see that if you look at the industrial businesses in the infrastructure segment without the verticals, the revenue is up 24% and the segment profit is up 29%, nice leverage, so a good performance.

Some of the business dynamics are on the right side. What I will do is go into more detail on aviation and energy. I'll start with aviation.

Our revenue is up 21%, segment profit up 10%. Pretty good orders, total orders of $5.4 billion were up 12% for aviation. Commercial engines of $1.6 million were down 8% but again, you're dealing with some pretty tough comparisons for the wins last year and the GE-90 wins. Military engine orders were up 62%, driven by some Navy F18 orders.

The product backlog continues to grow. Commercial engine orders for the quarter were 113% of the sales so again, the book-to-bill was growing backlog. We ended the quarter with $20.5 billion in backlog, up 22% from last year.

In terms of revenues of $4.9 billion, we had commercial engine revenues up 29%, so very strong shipments. We shipped 59 more commercial engines than in the prior year. The service revenues were up 23%, which is nice. Commercial was up 11%. We had good strong part sales. The spare part sales per day were $19.4 million versus $17.5 million a year ago, up 11%. The military engines were up 16%.

Smiths has performed very well. We added $640 million of sales, up 5 points. The operating profit had a similar profile to Q2, it's up double-digit, driven by Smiths, about 5 points and driven by core operations about 5 points. So overall, a pretty positive quarter in aviation.

Energy just continues to be extremely strong. John and his team had another great quarter, revenues up 35%, segment profit up 37%. The orders in energy continue to be excellent. The total orders of $8.9 billion are up 36% in the quarter. Major equipment orders were up 47%. We had $3.2 billion of thermal orders. That's up 39%, so we had good gas turbine orders globally. The thermal backlog is at $9 billion, up 90% from a year ago, so we are seeing global demand continue.

The wind orders just are continuing to be really strong. We had $1.3 billion. That's up 58% and the backlog now in wind is $14.5 billion. That's up more than 3X from a year ago, so just tremendous renewable performance and an amazing renewable portfolio here in the energy business.

Overall power gen orders, price was up 5% for the quarter and services were also great. Service orders were up 19% to $3.2 billion. Revenues at $7 billion were up 35%. Thermal revenue was up 69%. We shipped 44 gas turbines in the quarter, which was up from 41 last year and the price was up 4%. Wind, we shipped 672 units versus 597. Service revenues were up 19%, good, broad services performance in both transactional services and contractual services. Operating profit was up 37%. This is driven by all that volume I talked about in price at power gen. Overall just a broad-based, excellent quarter.

You can see oil and gas had a great quarter with strong productivity and synergies from Vetco. Vetco is performing very well, great demand for sub-C.

Transportation had a strong quarter, driven by international and mining equipment. The asset quality in the verticals continues to be solid. We have zero non-earning assets. That's a great tribute to the teams there, to be able to manage and deploy and redeploy globally.

Finally overall, if you just look at infrastructure, it continues to be the strength of GE based on tremendous global demand.

It's great to report next on healthcare. They had a great quarter. I feel very positive about it. Revenues of $4.5 billion, up 11%. Segment profit of $747 million was up 8%. A little tailwind from the revenue rec adjustment last year but still ahead of guidance, which the team did a nice job.

Orders trends are also improving. Orders were up 10% and the diagnostic imaging orders were up 8%. Again, it's a similar story across the company: international was up 15% and the Americas were up 1%, but good performance in surgery, up 22%. It's great to have shipping. Life Sciences up 29% and MDX up 5%.

Services also had a great quarter, up 13%. A strong balanced growth in DI and clinical systems and healthcare IT and in Life Sciences, so we feel good about the order performance and the trends there.

On the right side, in the quarter we shipped 700 units out of OEC, which is a nice performance and we are on track for 1,200 unit shipments in the second half, about 600 each in the third and fourth quarters is the estimate today.

The good news here -- if there is in a decline in revenue -- is that the decline in revenue is slowing. We were down 7% in the quarter in the U.S. and if you look at U.S. DI, it was down 6% as it shows here, versus if you looked at the last five quarters we've been down double-digits. We're seeing it down to single-digit and good momentum with new products coming in in the third and fourth quarter in both MR and CT and also in clinical systems, so we feel pretty good about that.

The strength to healthcare continues to be global. DI International was up 24%, Life Sciences international up 31%, very strong performance, and services revenues were strong globally, up 11%.

Good news in the Senate. The Medicare bill passed without any imaging cuts and overall good results in a challenging U.S. environment, driven by continued strong global growth, so a nice job by the healthcare team.

Industrial products in total had a tough quarter. Revenue was up 2% and segment profit down 32%, but this is a mix story. Just like in the first quarter, the results need to be split between the consumer and the industrial business and enterprise solutions.

On the left side you can see some of the commercial trends we're dealing with. The U.S. appliance industry core was down 7% in units, total was down 5% and you can see just this business was really impacted by housing. Housing starts in June were down 30%. We obviously have a great position in the contract channel related directly to housing.

In terms of orders, it's a similar picture to the other parts of GE. The U.S. orders were down 7%, offset by global growth, a great performance in Asia and Europe and Latin America. One other impact here for appliances, we had over $70 million of commodity inflation and the team is raising prices but we only recovered about half of that in the quarter, so we've got more work to do.

On the right side, the positive story was enterprise solutions. Revenues up 20%, segment profit up 20%, driven by a continued strong performance in our sensing and inspection businesses and our digital energy businesses, but that wasn't enough to offset the pressure in consumer and industrial. Revenues were down 3%, segment profit was down 55%.

We have responded to the inflationary inputs. As we said, we did have positive price in the quarter but we lost some core share, about 2 points, and the volume was down 9%, which really drove this profit down. It is a tough domestic market. There's no question the U.S. revenues were down, U.S. industrial revenues were down as well but offset by strong global growth.

We are doing a lot of restructuring in C&I. To date, we've announced 16 plant closures and 3,600 employee headcount reductions but at the end of the day, the operating profit was down 30% and C&I is down 55%, partially offset by enterprise solutions up 20%.

So we're operating in a tough U.S. environment, driven by the consumer and we are getting some benefits of the stronger global growth.

Next is NBC. Pleased to report that NBC delivered their 7th quarter in a row of positive earnings growth. You look at revenues of $3.9 billion, up 7%; segment profit of $900 million, up 1%. Just as I go around the different parts, the network and local stations were down about 2% in revenue but flat in operating profit. The dynamics are our TV studio had another positive quarter, based on hits like "The Office" and "House".

News remained #1 in the quarter and while prime ratings were down about 10%, the overall trade-off on lower cost of programming was positive in the quarter and that was partially offset by the continued softness we see in local, which was down about $40 million.

The strength in NBC continues to be in cable. They delivered excellent results. Operating profit was up about 13%. USA was #1 for the 8th quarter in a row. Bravo, SciFi, Oxygen had the best second quarter ratings ever. MSNBC also had the best second quarter ratings ever. The prime ratings are up 52% year-to-date; a great performance by the team.

On the right side, film and parks, we did have a nice start to the summer. Five of our six second quarter movies met or exceeded expectations. But the release schedule did create some timing pressure on earnings, as we have significant advertising and promotion spend on both the 2Q movies that happened and the 3Q upcoming movies. For the parks, we saw favorable spending but the attendance was down about 1% in Orlando and 11% in LA, partly impacted by the fire we had out there.

We also had very good news in the upfronts this year. We expect to close out with about $4.3 billion of commitments for the '08/09 season versus $4 billion for the '07/08 season. That's a great performance by the team. The network will be up about 2% and cable will be up about 25% so that bodes well for the future.

Finally, the Olympics are four weeks away. We are really excited about it. We expect about $1 billion in advertising, $850 million at the network plus cable and then another $150 million at the local stations, so that we're looking forward to. There's a lot of positive energy around the Olympics today and we are excited about it. In addition, we have our Olympic top sponsorship where we've sold over $700 million f GE products, industrial sales, as a partner with the International Olympic Committee.

So the summary for NBC is robust cable growth; film positioned for a nice second half, a very strong second half, and another on-track quarter.

One page, an operations update here. On the left side is the operating profit rate. The rate is down 40 basis points in the quarter but with our revenue growth, we still grew our operating profit dollars by over $500 million, so a good performance overall in terms of generating more profit dollars.

Our pricing actions have more than offset inflation. If you look, that's positive 20 basis points. We are getting productivity, that's about 30 basis points. We still have a drag from growing our equipment businesses at 2X our service businesses and with the lower margin in equipment, that's a drag of about 30 basis points. But the biggest drag in the quarter was the C&I results and you can see that.

Infrastructure grew the margin by 60 basis points, a nice performance with tremendous top line growth. Our current call for the total year is about 16%, down 60 basis points, mostly driven by the lower C&I results that we've had and that we are forecasting.

In the middle is our update on the $1 billion incremental base cost reduction at the half. We've realized about $400 million of that. We are on track for the billion. It's split about 60% industrial, 40% financial. From 2007, the beginning of last year through the second quarter, we've reduced 11,300 jobs through restructuring. Those are completed programs, not announcements, so we continue to take out structural cost in the company.

On the right side is our industrial cash flow from operating activity. We delivered $7.3 billion of CFOA. That's our industrial net income plus our depreciation plus $1.5 billion of additional cash from working capital. That's while we grew our industrial sales 11%.

Just as a point, if you look at our working capital turnover performance, in 2004 we had 10 turns and in the second quarter of 2008 our turns were over 16X. I think that's pretty strong execution around working capital while growing the company.

We have a strong focus on executing price everywhere in the company to more than recover inflation and continuing to improve our structural costs.

Cash in total, I mentioned it is $9.3 billion. This is just the split we give you every quarter between GE Capital dividend and industrial CFOA. The overall cash is down because we don't have any special dividend from insurance dispositions this year to compare to last year, but the industrial CFOA is up 5% at the half. That is slightly ahead of our internal plan.

On the right side is the cash balance walk that we give you every quarter. You start with the $6.7 billion, add the cash flow from the left side over, $9.3 billion. We take out the dividends we paid of $6.2 billion. We have repurchased $2.5 billion of stock so far this year. Our plant and equipment reinvestments, $1.6 billion at the half.

We did close two acquisitions, Hydril and Whatman. That's about $1.5 billion and we paid down some debt at the beginning of the year based on the bond we raised at the end of last year for corporate. We're on track for the 10% total year industrial CFOA of about $17.5 billion and on track for the total CFOA, including the [CHEX] dividend of 40% at $22 billion.

Now before I get into the results of the two financial services segments for the quarter, I want to provide just a couple of updates. First on this page for financial services, we do know what our business model is. We feel great about our competitive position and about our sustainability.

I thought I'd just list the major businesses down the left side, the percent of assets in those businesses and just talk about the business model that we feel great about.

Capital Solutions at the top of the bar, this is a midmarket lessor. It's got 1 million customers. It's very diversified and we are senior and secured. We know the assets and we directly underwrite the assets in this segment.

Corporate finance, 20% of the assets. It's also a midmarket focus. We have incredible credit and restructuring expertise here. We underwrite specific loans for companies and assets we know.

Our real estate, 14%. World-class underwriting. We're very focused on supply and demand on every property we invest in, whether it's debt or equity. We are senior secured on the debt side. We have low loan to values, and the average property size in the portfolio is $10 million, so again another portfolio of incredible diversification.

The verticals, deep domain expertise, principally energy and aviation here. As you know, strong underwriting portfolio management. Just as an example in aviation, we've been through over 200 bankruptcies in the last ten-plus years and we have great global asset management to be able to redeploy and take advantage of supply/demand in other parts of the world, and that team has done a great job.

Consumer, 35% both secured and unsecured. We have over 130 million accounts. The average balance is $1,600, so incredible diversification and about half of that is secured, whether it's mortgages or auto loans, and the other half is unsecured based on credit scoring and risk management. We're in 50-plus countries, so an incredibly diversified global business.

Our focus in financial services, we want to be great at origination. We have over 10,000 originators. That's a real competitive advantage, hard to replicate or compete with. We underwrite to hold. The businesses, everything we bring in from a credit perspective is looked at to put on our books. Sometimes we can sell it out but we underwrite it as if we are going to put it on our books and hold it.

We've got great risk management. Our loss averages over the last 20 years have been far below the banks. We manage the company as a AAA, from the board of directors down to the capital board, down to the management teams, everything we do is about making sure we keep the AAA and I'll show you more on that on the next page.

We are very disciplined on capital allocation. We run a checkbook. Every month we look at what the potential deals are, where do you put the equity based on available equity, self-funded and we're very disciplined about managing the best return based on the risk and making sure it's things that we can afford to do based on a checkbook, just like you would with your own money.

We're not traders or speculators -- we don't borrow short and lend long. We're match funded so we focus on credit or asset risk, not interest rate risk and we're not a passive buyer of packaged assets. We underwrite directly to securities. If you look at the first half earnings in financial services, $5.2 billion in our financial services business, it's certainly a leader in the industry and we've got a great 20-plus year track record.

There are two other areas I want to cover. First on the left side, I wanted to talk a little bit about global mortgages and the GE Money business. We've been in this business for more than seven years in a big way. We've been in it for a lot longer than some of the global platforms.

We have $79 billion of non-U.S. mortgages in GE Money. If you look over time, this is a chart of our write-offs to our average net investment. Our write-off experience in this business is extremely low. We are senior and secured. Even if you took the current loss level from 0.08 up to 15 basis points on the current book, you are talking about $120 million of losses, so we are very careful about how we underwrite this book.

The portfolio is in great shape. This is a lot different than the experience you are seeing in the U.S. I thought I'd use the UK book as an example. We have $29 billion of assets in the UK earning over 25% return on equity. We have no originate to sell. Everything we do in the U.K. is originate to hold.

We have our own in-house appraisal and servicing group. These are experienced GE employees who go out and validate the values of every property. We have insurance on properties that are over 80% loan to value and the process requires the insurance company to also underwrite every file before they provide coverage.

The average loan to value is 71% and I can tell you that after the first trouble we had at WMC late in '06 we sent our risk manager with 37 years of experience and our corporate audit staff to every major mortgage platform around the world to ensure we had world-class practices on risk management, underwriting, and collections. Our global mortgage portfolio is in very solid shape.

On the right side, I want to update where we stand on capital and funding. This is a chart that shows our adjusted debt to equity ratio, so if you take our book leverage right off the GE CC financial statements and you adjust for two things: first, the insurance equity that we did a dividend out of GE Capital in the '04/05 timeframe. We had a lot of excess insurance equity so it made it look like our leverage was lower. We dividend that out, you adjust for that and look at what the product leverage was on the assets on the books without insurance equity.

The second thing is you take into account the hybrid debt that we've issued, which is long-term debt that does get equity credit, to some extent, from the rating agencies. If you adjust for those two things, you can see we've maintained consistent leverage for the past five years. We have 260 individual product leverages, so for every investment decision we make, we know what the leverage has to be to stay at a AAA capital level based on the probability of the default and the loss given default estimates.

Our funding is in terrific shape. We've completed $60 billion of long-term funding this year out of a plan to do $80 billion to $85 billion, so we are over 70% done at the half. In a pretty choppy capital market, we decide to get out ahead of it.

We've lowered our commercial paper to under $100 billion. The demand is incredible. We could do as much as we wanted. We've lowered it to make sure we have the right liquidity profile. We've extended our average term out over 60 days and we are operating in several global countries, it's not all in the U.S.

We have good liquidity plans in place and the rating agencies have just completed their annual reviews and you can read the reports on GE and GE Capital. They are on the websites for S&P or Moody's. We pay attention to every single metric: retained cash flow to debt, leverage, capital, liquidity, and it's really not anything like being limited to an annual review. It's a real-time, open book, constant communication relationship.

We are self-funded. As I said, we have a checkbook. We absolutely don't need any external capital infusion and we won't. If you look at the financial strength between the leverage and the capital and where we are, we feel great about the capital position.

Let me turn to the business results. We had a nice rebound in commercial finance in the quarter. Mike Neal and his team delivered a solid performance, above expectations. We had another strong performance globally on origination. Assets were up 22%, revenues were up 14%, and segment profit of $1.4 billion was up 7%, ahead of our guidance.

Pretty much just like everything went against us in Q1, we had pretty much everything go for us in Q2. It was a good quarter across the board.

Let me start with real estate. Real estate earnings were up 2% in the quarter. We sold $2.8 billion of assets in the quarter, even in a tough market. I think that's excellent execution. It was above our guidance. It's still a challenging market out there, the team did a good job. In the quarter we sold 126 properties for the $2.8 billion and in total, we shrunk our equity book by $2.6 billion in the quarter.

We are remixing this portfolio in real estate. We did have $7 billion of asset growth and that is all senior secured debt at about 70% loan-to-value with 25% to 30% ROE, so I think that is terrific that we can invest our capital into those type of returns at that level of risk.

The portfolio quality remains strong. Our non-earning assets are 0.18% of our outstanding receivables. The 30-day delinquency in real estate is 0.17%, down 25 basis points over last year, so a good risk management and a nice quality in the portfolio.

Capital solutions earnings were up 9%, driven by both acquisitions and core asset growth. Our on-book volume was down about 18% as we raised price. New margins, new business margins are up 41 basis points in the quarter. The portfolio quality here is nice and stable, 20-plus delinquencies. 30-plus delinquencies are 1.35%, basically flat with the first quarter.

The balance of commercial finance earnings were up 11%. Corporate finance was down 12% but equipment services benefited from the $90 million gain I talked about on the sale of 9% of Penske and that also contributed to our above guidance performance. Pretty good performance, good asset quality.

We continue to take out costs in this business and we feel great about the second quarter execution. We're still cautious about the future environment but on any relative measure, the commercial finance business continues to outperform.

GE Money also delivered results ahead of expectations. On the next page, revenues of $6.6 billion, up 6%. Assets, segment profit of $1 billion were down 9% as Jeff mentioned and I mentioned. Assets were up 17% year over year. Really, this was driven by foreign exchange. That's about 8 points of the 17 points of growth, it's such a global portfolio. The balance came from core growth and acquisitions, principally the BBH Bank in Poland.

Assets were up only 1% from Q1. We are seeing slowing new volume as we are also raising pricing here and tightening underwriting globally in the money book. Net income was down 9%. It's really driven by lower Americas profitability. If you remember in the quarter, second quarter last year we had a higher securitization income that was partially offsetting our WMC losses. The losses went into discontinued ops but we had $108 million lower securitization income year over year and we also had higher provisions in the U.S. of about $100 million. Global net income partially offset that. It was up 5% and that was principally driven by nice growth in Central and Eastern Europe, which was up 44%.

On the right side, Jeff mentioned the portfolio actions we are taking. I feel great about both the exits that are in place and the exits that are completed, and I'll cover PLCC in a few pages. On the portfolio quality, a couple of comments, a little bit about delinquencies. The total 30-day delinquencies in this business is 5.92%. It's up 70 basis points.

Really two drivers: one is North American delinquencies are at 5.55. That's up 105 basis points. The second one is the UK secured delinquencies at 16.68. That's up 317 basis points, so the rest of the world actually drives delinquencies down 20 basis points outside those two places.

In the U.S., we did see a decline in delinquencies in the second quarter from the first quarter of about 20 basis points, reflecting some seasonality but also we think we got some positive impact from the tax rebates. As I mentioned, we added $100 million to provisions in the U.S. in the quarter. In line with the guidance, we have to increase the provision somewhere around $600 million to $800 million in the U.S. for the whole year.