What 's HOT And NOT In Forex Trading

As we all know, this subject is something that we could all use a little education on no matter who you are.

Here are the characteristics of successful FOREX trading

1. Successful FOREX trader cultivate to have absolute handling over their emotions. They will never get too excited over a win or too depressed over a lost.

2. Successful FOREX trader do not panic. They will make evolutionary adjustments and not revolutionary changes to their trading style.

In the introduction, we saw how this subject can be beneficial to anyone. We will continue by explaining the basics of this topic.

3. Successful merchants discuss trading as a commerce and not a hobby.

4. Successful FOREX merchants are ready for all eventualities on any given trading day. They come to work with a proposal that includes many contingencies and not just what they hope the outcome will be.

They already have solutions to these eventualities. What happens if

- The market is very subdued?

- The market is dangerous?

- The market goes up early and reverses later?

- The market goes down early and reverses later?

5. Successful FOREX trader trade only with money he can afford to lose.

You don't have the profile of successful trader if some of the above qualities don't sound like you. FOREX trading depends on your skills and not luck. FOREX is the prime market nowadays, triumph a daily amount of 3 trillion dollars around the world. That means that there is no single participant in the market; banks and governments included, who can consistently move the direction on the way they wants. You must have skills to forecast which track the market are actually going in few days or months.

Another important key to successful FOREX trading is to get a genuine and correct FOREX trading platform that is painless to control.

What you have learned while reading this informative article, is knowledge that you can keep with you for a lifetime. Do not trade with emotions and you will do much better.

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Please be reminded that trading forex involves risks.

Exxon sets record with $40 billion US annual profit

Exxon Mobil Corp. posted the largest annual profit by a U.S. company Friday — $40.6 billion US — as the world's biggest publicly traded oil company benefited from record-high crude prices at year's end.

Exxon also set a United States record for the biggest quarterly profit, posting net income of $11.7 billion for the final three months of 2007, beating its own mark of $10.7 billion in the fourth quarter of 2005.

The previous record for annual profit was $39.5 billion, which Exxon Mobil made in 2006.

The eye-popping results weren't a surprise given record prices for a barrel of oil at the end of 2007. For much of the fourth quarter, oil hovered around $90 US a barrel, more than 50 per cent higher than a year ago.

Crude prices reached an all-time trading high of $100.09 on Jan. 3 but have fallen about 10 per cent since.

Exxon Mobil, which owns 70 per cent of Canada's largest oil producer and gasoline refiner and seller, Imperial Oil Ltd., is one of the world's biggest energy companies, with three per cent of global oil output.

The record profit for the October-December period amounted to $2.13 a share versus $1.76 a share in 2006. Year-ago net income was $10.25 billion.

Also extraordinary was Exxon Mobil's revenue, which rose 30 per cent in the fourth quarter to $116.6 billion from $90 billion a year ago.

For the year, sales rose to $404.5 billion — the most ever for the Irving, Tex.-based company — from the $377.64 billion it posted in 2006.

In a statement, Exxon Mobil chairman Rex Tillerson said the company continued to meet the world's energy needs through its "globally diverse resource base."

"Our long-term investment program, in projects often far from major consuming nations, continued to provide resources essential to the increasingly interdependent global energy supply network," Tillerson said.

Imperial posts record-high profits

Exxon Mobil's results came a day after Calgary-based Imperial reported record high profits last year on higher crude prices, smooth-running marketing and refinery operations and higher volumes from the Syncrude oilsands project in northern Alberta.

The positive factors for the year were offset a bit by lower than expected conventional resource volumes, pressure from the rising Canadian dollar and higher tax expenses.

The Canadian company earned $3.19 billion Cdn in 2007 on revenue of $25 billion, beating Imperial's previous record of $3.04 billion set in 2006 on revenue of $24.5 billion. In the fourth quarter, Imperial Oil earned $886 million, up from $794 million. Fourth-quarter revenue increased to $6.7 billion from $5.5 billion a year ago.

In trading on the New York Stock Exchange on Friday, Exxon Mobil shares fell 45 cents to $85.95 US after rising as high as $87.86 earlier in the session. The shares have traded in a 52-week range of $69.02 to $95.27.

Higher commodity prices in the quarter were clearly evident from earnings at Exxon Mobil's exploration and production arm, known as the upstream. Income rose 32 per cent to $8.2 billion from $6.2 billion a year ago.

On an oil-equivalent basis, production increased nearly one per cent from the fourth quarter of 2006. Excluding the expropriation of its Venezuelan assets last year, divestments and other factors, production rose nearly three per cent.

Refining and marketing, or downstream, earnings were $2.3 billion, up from nearly $2 billion in the year-ago quarter, as improved refining operations offset lower U.S. refining margins.

In the U.S., downstream earnings were off sharply from a year ago — $622 million in the most recent quarter versus $945 million in 2006.

Refining margins — the difference between the cost of crude and what the company makes on refined products such as gasoline — have been squeezed in recent months as spiking oil prices outpaced increases in gasoline prices and other refined products.

Motorola's potential breakup pleases investors, confuses analysts

Motorola Inc.'s announcement late Thursday that it would consider selling or spinning off its struggling cellphone business was popular on Wall Street Friday, but technology analysts question whether a separate venture will fare any better in the competitive mobile handset market.

Shares in the Schaumburg, Ill.-based company moved up $1.40 US to $12.90 US, a 12 per cent rise, at the open of trading Friday in response to the news before dropping down to $12.69 US at market close.

Investor and billionaire financier Carl Icahn, who led the call for a drastic overhaul of the company including the split of its handset unit, said on Friday he was "pleased" Motorola is exploring his proposal.

Two years ago, Motorola's handset sales were riding high, buoyed by sales of its sleek Razr phone. Since then, Motorola's flagship division has been in free-fall, with handset sales down 38 per cent in 2007 from the previous year and worldwide market share plummeting from 23 per cent to 12.2 per cent in the same period, according to research firm IDC.

Motorola currently trails Nokia, which has 40 per cent of the market, and Samsung, with 13.9 per cent, according to IDC.

"It's been an atrocious year for them," said Mark Tauschek, a technology analyst with U.S.-based Info-Tech Research Group.

"The trouble with a downhill slide is it snowballs, and people are kicking you as you're going down."

Should Motorola spin off or sell the division, it would be left with its two other main units, one that builds wireless networks for companies and one that makes television-set-top boxes and modems for home use.

Motorola said separating the mobile business would "permit each business to grow and better serve its customers."

Gartner analyst Phillip Redman questions whether selling the division that is the public face of the company will effectively end the 80-year-old firm's relevance.

"The challenge they'll have is if they spin off that part, they are going become a fairly insignificant, niche player," said Redman.

"Right now, it's the handset business that keeps their brand out there and they are not really going to have a ton of visibility worldwide."

The mobile unit reported revenues of about $19 billion US in 2007, making them a potentially attractive option for an outside buyer, said Redman.

A Chinese telecommunications vendor such as Huawei Technologies Co Ltd. or ZTE might be potential buyers should Motorola decide to sell, rather than spin off, the division, he suggested.

Division would do little for buyer: analysts

Info-Tech Research Group's Tauschek also suggested Samsung or another major player might look to acquire the division in an effort to close the gap with worldwide leader Nokia.

But neither analyst felt buying the division would do much for the purchaser.

Tauschek said past takeovers in the industry, such as BenQ taking over the Siemens mobile unit or Alcatal doing the same for Lucent, have done little for the prospects of the new companies.

"If you add that kind of turmoil, it's very hard for the people in your business trying to come up with exciting new products to keep their eye on the ball," he said.

Motorola is still the number 1 handset maker in the United States and also had a leading market share in Canada of 29 per cent in January 2007, ahead of Nokia and Samsung, according to Kaan Yigit of Toronto-based Solutions Research Group.

But 2007 was such a poor year, Yigit estimates Motorola's share of the Canadian market may have fallen to 24 or 25 per cent.

The problem for Motorola, said Yigit, is that while higher-end handsets like Research in Motion's BlackBerry line or Apple Inc.'s iPhone still inspire loyalty among consumers, the mid-range handset market is harder to keep.

"This sale will have zero impact on consumers," said Yigit. "One person in a focus group told me recently that with each successive replacement or update to a product, he's becoming less emotionally attached to his cellphone."

Last month's auto sales second-strongest January in history: consultant

When it came to buying cars, Canadian consumers ignored the bad economic news in January, a Canadian auto consultant reported Friday.

Sales of new cars and light trucks last month were up 12.8 per cent over January of 2007, DesRosiers Automotive Consultants said. In all, 102,831 vehicles were sold, up from 91,180 a year earlier. It was the second-strongest January in history, DesRosiers said.

"The lesson here is don't believe all the negative news in the business media each and every day. Consumers make up their minds one at a time and they decided in very big numbers to stay in the market for a new vehicle in January," Dennis DesRosiers of the consulting group said.

Even the troubled North American auto makers did well, with General Motors's sales rising 18.1 per cent, Ford adding 9.7 per cent and Chrysler gaining 1.9 per cent.

While sales of North American brands grew more slowly than import brands, overall, the Big Three outsold their competitors by about 56,000 vehicles to 47,000.

GM's sales of 26,404 vehicles left it firmly in first place, followed by Chrysler, Ford and Toyota.

BMW Group Canada (the BMW and Mini brands) reported the best January ever.

Mayo Clinic worried by CPR's U.S. acquisition

The internationally renowned Mayo Clinic has asked a U.S. regulator to intervene in Canadian Pacific Railway's pending $1.5-billion-US takeover of the Dakota, Minnesota and Eastern Railroad.

The medical centre in Rochester, Minn., as well as local businesses, the county and the City of Rochester, are worried that the deal announced in September 2007 will lead to a huge increase in train traffic through the city.

The Rochester Coalition, the umbrella group for the clinic, city, county and local chamber of commerce, has asked the U.S. Surface Transportation Board to require the Calgary-based CPR to mitigate any potential problems caused by increased use of the tracks.

"Any increase in hazardous material shipments through Rochester without adequate mitigation poses an unacceptable risk," Dr. Glenn Forbes, CEO of Mayo Clinic, said in a release issued Friday.

The board is expected to approve the deal in the fall.

The coalition is particularly worried about the Dakota, Minnesota and Eastern's plans to expand into the Powder River Basin in Wyoming.

The DM&E's tracks split Rochester and pass very close to the clinic. There are just two or three slow-moving trains on the line on an average day, but the proposed Powder River Basin expansion could lead to more than 34 trains a day "carrying vast amounts of coal and hazardous materials at speeds in excess of 50 miles per hour," the release said.

The coalition is also worried about conflicting messages about the Powder River Basin project.

CPR hasn't made a decision about the plan, "but that isn't stopping DM&E from trying to advance the project anyway," Olmsted County Commissioner Ken Brown said in the coalition's release.

"We don't control the DM&E's day-to-day actions" because the stock has been placed with an independent trustee, pending the Surface Transportation Board's decision, CPR spokesman Mark Seland said.

He reiterated that the CPR has not made a decision about the Powder River Basin project.

But even without the Powder River Basin plan, traffic volume on the line is expected to increase.

Costly upgrades

CPR has suggested that it will spend about $300 million US to upgrade DM&E, "but it is unclear where or how that money will be spent, or whether it will benefit Rochester in any way," the coalition said in the released.

It noted that a decade ago, DM&E claimed that it would cost more than $800 million US to fix dilapidated lines and structures.

CPR has said the DME is boosting its business.

The DM&E stock has been placed with an independent trustee, pending regulatory approval of the takeover, CPR has said.

Google shares hit hard

Google Inc. shares fell more than eight per cent on Friday, a day after the company produced quarterly revenue and profit that missed analysts' expectations.

The stock fell $48.40 US to $515.90 US on Nasdaq.

The earnings miss was also coupled with news Friday that Microsoft proposed a $44-billion US takeover bid for Yahoo.

The internet search leader said after the close of trading Thursday that it made $1.21 billion US, or $3.79 per share, in the fourth quarter, up 17 per cent from $1.03 billion, or $3.29 per share, for the same period in 2006.

Google said it would have earned $4.43 cents a share, if not for stock awards given to its employees. That figure was one cent below the average estimate by analysts surveyed by Thomson Financial.

Revenue jumped by 51 per cent to $4.83 billion US from $3.21 in the same quarter a year earlier.

The company's net revenue missed analysts' estimates by about $60 million, or just under two per cent.

There is growing concern that Google won't be able to sell as much online advertising — its main source of profit — as consumers reduce their spending amid ominous signs of a recession in the U.S.

The company's fourth-quarter profit increase was the smallest in its 14 quarters as a publicly held company. It was just the third time that Google's earnings failed to exceed analysts' estimates.

Alcoa says it will join with Aluminum Corp. to buy 12% of Rio Tinto

Alcoa Inc. said Friday it is joining with Aluminum Corp. of China to buy 12 per cent of London-listed Rio Tinto PLC (LSE;RIO.L) shares.

Alcoa released a statement saying it will contribute $1.2 billion US to the total investment.

The company praised Rio Tinto's portfolio of assets and says the company is "well positioned to prosper in the current mining cycle."

Alcoa described the partnership with Aluminum Corp. of China, the country's biggest aluminum producer, as one that would 'allow us to mutually benefit from developments in the sector.'

Last year, Rio Tinto acquired Montreal-based Alcan for $38.1 billion.

The British mining giant outbid Alcoa in the Alcan purchase.

Big Loans, Lower Rates

The government's new economic stimulus package is likely to benefit some people buying or refinancing a house -- but not all.

As approved so far by the House, the package would raise the maximum mortgage that lenders can sell to big mortgage buyers Fannie Mae and Freddie Mac. That cap -- now $417,000 -- matters because rates on larger "jumbo" mortgages are higher these days by as much as a full percentage point.

Under the House bill, the "conforming" loan limit would rise for one year to as much as $729,750. (Many parts of the country would be limited to 125% of an area's median home price.)

If it becomes law, the change will allow more consumers to either buy a home or refinance one using a conforming mortgage. That could be particularly beneficial in areas, including parts of California and New York City, where $417,000 buys only a bungalow or small apartment.

But there's a hitch. Lenders have become increasingly hardnosed about who they'll finance, while Fannie and Freddie are instituting risk-based pricing. The upshot: Borrowers with spotty credit or little home equity won't get the best rates.

Consumers who'll benefit the most from today's sharply lower mortgage rates: those with high credit scores (above 680) or large amounts of equity in their home (at least 30%) or both.

Singapore's GIC to buy Westin Hotel Tokyo for 723 mln dlrs

The Government of Singapore Investment Corp (GIC) has agreed to buy the Westin Tokyo luxury hotel for 77 billion yen (723 million dollars) from Morgan Stanley, a newspaper said Sunday.

The parties have reached a basic accord on the purchase of the land and the building located in Tokyo's high-end residential and commercial district of Ebisu, the Nikkei business daily said.

They plan to complete the deal by late February, the newspaper said.

GIC will likely have the hotel continue its current operations and aim to increase the asset's value by making it a long-term investment.

The purchase indicated that Japan's real estate market is relatively attractive though other ones around the world are suffering from the US mortgage crisis, Nikkei said.

GIC is one of the world's largest sovereign wealth funds, with more than 200 billion dollars in assets under management, the report said.

In December and January, GIC made large investments in UBS AG of Switzerland and Citigroup Inc of the United States. Last year, it acquired Hawks Town, a commercial complex in Fukuoka Prefecture, western Japan.

Morgan Stanley purchased the Westin Tokyo for about 50 billion yen from Japanese brewer Sapporo Holdings Ltd in 2004.

Yahoo needs time to mull Microsoft offer

Yahoo Inc (YHOO.O: Quote, Profile, Research) said it may take "quite a bit of time" to weigh its strategic options, including keeping the company independent, following Microsoft Corp's (MSFT.O: Quote, Profile, Research) $45 billion (23 billion pounds) offer to buy the company.

In a weekend posting on the company's Web site, Yahoo said it was undertaking a deliberate review of Microsoft's unsolicited offer to pay Yahoo shareholders either $31 in cash, or 0.9509 of a share of Microsoft common stock.

The review "will include evaluating all of the Company's strategic alternatives including maintaining Yahoo! as an independent company," the posting said. "A review process like this is fluid, and it can take quite a bit of time."

In response to a frequently asked question about whether Yahoo would seek proposals from other companies, also posted on its Web site, the company said it was going to evaluate all options.

Analysts cited Comcast Corp (CMCSA.O: Quote, Profile, Research), Viacom Inc (VIAb.N: Quote, Profile, Research) and General Electric Co (GE.N: Quote, Profile, Research) among possible bidders, although they also said few companies had the balance sheet to compete with Microsoft or were as natural a fit for Yahoo.

Microsoft's bold move to buy the Silicon Valley company would create a combined entity better able to respond to the growing dominance of Google Inc (GOOG.O: Quote, Profile, Research) in Web search and digital advertising.

Microsoft said it has courted Yahoo for the last 18 months, but its earlier approaches were rebuffed and it decided to make its offer public to Yahoo shareholders.

Yahoo shares shot up about 48 percent to $28.33 on the news of Microsoft's offer.

(Reporting by Daisuke Wakabayashi, editing by Todd Eastham)

Ad Growth Still Strong, Google Says

Google said it has seen no effect from a slowing economy on its advertising business, as it reported a 17 percent jump in profit and a 51 percent growth in revenue in the fourth quarter.

The result represents a slowdown in Google’s growth rate and fell shy of expectations. The company said it remained bullish about its business, regardless of the outlook for the overall economy.

“We have not seen any impact as of now,” said Eric E. Schmidt, Google’s chief executive, in an interview Thursday afternoon after the financial report was announced.

Mr. Schmidt said he had yet to see weakness in any advertising category.

It is not clear whether the comments from Google, the largest seller of online ads, will calm growing fears that a slowdown in the economy could take a bite out of online advertising.

While some analysts view Google as a bellwether for the online advertising sector, others say that its business relies disproportionately of small text ads that appear next to search results. Those ads tend to produce immediate results for advertisers because they drive traffic to their Web sites.

Analysts believe they are more impervious to a slowdown than banner ads, which are aimed at building brand awareness and are common on most sites.

“I don’t think Google’s ad model is insulated from a recession, but it is probably less vulnerable to cutbacks than other online ad models and definitely than traditional advertising,” said Scott Kessler, an equity analyst with Standard & Poor’s.

This week, Yahoo said it was too early to determine whether a slowdown in sectors like retail, housing, finance and travel would have an impact on its online advertising business.

During a conference call with investors, Google executives were upbeat about both the company’s results and its prospects.

“We are very, very pleased with our year and also with the quarter that just ended,” Mr. Schmidt said. He said that the movement of ad dollars from traditional media to online media is a trend that is not going to reverse. “We are optimistic about 2008,” he added.

Google executives went so far as to suggest that they might benefit in some ways from an economic downturn. Jonathan Rosenberg, senior vice president for product management, said worries about the economy could lead consumers to spend more time online searching for good deals. “If people are doing more comparison shopping and looking for bargains, that could be a positive,” he said.

The company’s shares closed at $564.30 during regular trading, up $16.03 for the day, or nearly 3 percent. But its stock fell 6.5 percent after hours, to $527.40.

The Internet search giant reported net income for the quarter of $1.21 billion, or $3.79 a share, compared with $1.03 billion, or $3.29 a share a year ago. Excluding items like stock based compensation, income was $4.43 a share, slightly below the $4.45 expected by Wall Street analysts.

Google said revenue in the last three months of the year rose to $4.83 billion, from $3.21 billion a year ago. Excluding commissions paid to advertising partners, a measure closely watched by Wall Street analysts, Google’s revenue jumped to $3.39 billion, from $2.23 billion a year earlier. Analysts had expected revenues, without partner commissions, to be $3.45 billion.

However, Derek Brown, an analyst with Cantor Fitzgerald, said that the results, “don’t indicate significant changes in the competitive landscape, the company’s growth trajectory or profit levels.”

Google also had some difficulties finding effective ways to advertise on social networks like MySpace. Sergey Brin, Google’s co-founder and president for technology, said some of its experiments did not pan out. But he said social networks represent “a big opportunity, because there is so much inventory.”

One issue weighing on investors is whether Google will win an auction for wireless spectrum, which is being conducted by the Federal Communications Commission. Google had promised to bid at least $4.6 billion — the reserve price set by the agency — for a portion of the spectrum known as the C Block.

The F.C.C. said it had received a $4.7 billion bid for the C Block on Thursday morning. The F.C.C. will not identify who places top bids until the auction for the C Block and for other portions of the spectrum are completed, a process that could take weeks. Many analysts believe that Google has no intention of winning.

But the uncertainty has been a drag on Google’s shares. Some investors fret that if the company won the spectrum, it might have to spend even more to build out a wireless network. Google ended 2007 with more than $14 billion in cash and marketable securities.

Alcoa, Chinese firm to buy stake in Rio Tinto

SHANGHAI -- Alcoa Inc. and Aluminum Corp. of China say they plan to buy 12% of Rio Tinto in a deal valued at $14 billion.

It is the biggest foreign investment yet by a Chinese company, Chinalco said Friday, and appears to be meant to block a bid for London-based Rio Tinto by Australian mining giant BHP Billiton. Alcoa said it contributed $1.2 billion to the deal.

Beijing-based Chinalco, the country's biggest maker of both aluminum and alumina, said it made its purchase through its Shining Prospect subsidiary.

Neither Pittsburgh-based Alcoa nor Chinalco "currently intend to make an offer for Rio Tinto," though they reserved the right to participate in an offer within the next six months.

"Our acquisition of a significant strategic stake in Rio Tinto PLC today reflects our confidence in the long-term prospects for the rapidly evolving global mining sector," Chinalco President Xiao Yaqing said.

Rio Tinto became the world's biggest producer of aluminum and bauxite with its $39.7-billion purchase last year of Canada's Alcands.

Like many major Chinese industry groups, Chinalco has been rapidly expanding internationally, acquiring assets in Australia, Canada, Peru, Fiji and Guinea.

FOOD SAFETY: Slaughterhouse's meat banned

Two major hamburger chains and dozens of school districts around the nation have banned meat from a Chino, Calif., slaughterhouse after a video showed workers brutalizing sick and crippled cows, officials said Friday.

School districts in California, Arizona, Hawaii, Utah, Montana, Minnesota, North Dakota, Washington and other states have stopped using ground beef from Hallmark Meat Packing Co. and its associated Westland Meat Co. until completion of a federal investigation.

Of the eight truckloads of beef North Dakota has received this school year through the U.S. Department of Agriculture's National School Lunch Program, five included ground beef that originated from the Hallmark plant, said Linda Glaser, director of child nutrition and food distribution programs for the North Dakota Department of Public Instruction.

Some of the meat undoubtedly was served to students, but there have been no reports of illness or meat quality problems, she said.

The federal government asked state education officials to contact school districts and tell them to set aside beef connected to the slaughterhouse. Glaser said that was done Thursday. The beef in question is being left in school freezers.

Week in review: Teaming up against Google

The fight for Internet dominance heated up this week with Microsoft offering to buy Yahoo for $44.6 billion in an effort to better compete with chief rival Google.

"Today, the market is increasingly dominated by one player, who is consolidating its dominance through acquisition," Microsoft said in a statement Friday. "Together, Microsoft and Yahoo can offer a credible alternative."

Microsoft's offer, which was contained in the letter to Yahoo's board, amounts to $31 a share and represents a 62 percent premium over Yahoo's closing price on Thursday. Microsoft said it will offer shareholders the option of cash or stock.

Yahoo said in a responding statement that its board "will evaluate this proposal carefully and promptly, in the context of Yahoo's strategic plans, and pursue the best course of action to maximize long-term value for shareholders."

At press time, industry watchers were busy chewing on the news and analyzing such a merger's potential impacts. How problematic would the huge cultural differences at the two companies be? Also, could an open-source offspring be the result?

The deal followed what's been a tough week for Yahoo in its own efforts to stay afloat against competitors. After posting higher fourth-quarter revenue than a year ago but a lower net profit, the troubled Web giant confirmed expected plans to lay off 1,000 of its 14,300 workers in February to help it focus on its search and advertising businesses.

Yahoo had long been known for its innovativeness. But somewhere along the way, it has become mired in bureaucracy and what some see as an inability to respond to more nimble (though considerably larger) Google.

Following the earnings and layoffs news, Yahoo also announced that former CEO Terry Semel, who left his post last summer but remained as non-executive chairman of the board, is now out of the company altogether. All eyes are now on CEO Jerry Yang, as some are still waiting for him to come up with a remedy for what's perceived as the company's eroding culture.

CNET News.com readers, many of whom responded to a related poll, seem split on whether Microsoft should be allowed to buy Google, and whether Google is a monopolistic threat.

To at least one reader, a merger makes "good business sense."

"Google watch out...Yahoo (is) making a comeback and (it's) gonna eat you up whole," the reader wrote in Talkback to a story.

Relative to Yahoo, of course, things are looking up for Google, which reported fourth-quarter revenue rose more than 50 percent and profit was up 17 percent. But the figures were just short of Wall Street expectations. That caused shares to take a dive in after-hours trading.

Those missed expectations were partly due to a rise in traffic acquisition costs that cut into revenue. But executives acknowledged in a conference call with analysts that the company made less money than expected serving up ads on social networks, a sign that social networks may not be the easy holy grail for advertisers they were once believed to be.

"When you have the largest online advertising player with the most advanced monetization tool set out there talking about challenges monetizing certain types of pages, yeah, it would seem to be an indication of a broader industry issue," said Derek Brown, an analyst at Cantor Fitzgerald.

And Microsoft, for its part, isn't seeing the same thing as its chief rival. A Microsoft executive told CNET News.com on Thursday that monetization rates are good and have been steadily rising since the company first began feeding ads to Facebook in mid-2006.

Vista's one-year checkup
Microsoft's Windows Vista operating system turned one this week, which meant it was time for a thorough examination of its strengths and ailments.

A one-year security checkup came back with, if not a completely clean bill of health, at least signs that the infant is healthier than most babies.

According to the report, Microsoft issued 17 security updates fixing 36 vulnerabilities in Vista in the 12 months following its commercial launch in November 2006. By comparison, the company issued 30 security updates encompassing 65 vulnerabilities in XP's first year.

The report's author, Microsoft's Jeffrey Jones, says those numbers compare with more than 100 vulnerabilities fixed in Mac OS X Tiger's first year, more than 220 flaws in Ubuntu version 6.06 in its first year, and 360 flaws fixed for Red Hat enterprise Linux 4 in its first year.

There are lots more ways to look at how Windows Vista did in the first year, and CNET News.com's Ina Fried examines the plusses and minuses of Vista, looking at topics like the "downgrade to XP" movement, sales numbers, and compatibility with hardware and other software. Fried also took a rather unorthodox approach to assessing Vista by applying what she calls the "Mom test."

Godiva Chocolate Room Up for Grabs

NEW YORK (Jan. 30) - Don't lick the walls.

An all-chocolate room was unveiled in Manhattan on Tuesday - a pre-Valentine's Day creation complete with furniture and artwork made of the sweet stuff.

"It's the perfect bit of sin," said Ali Larter, star of TV's "Heroes," of the Godiva chocolate "pearls" that are her private daily indulgence.

Here, they were dripping off the chandeliers above the dining table, which was a sea of stars, truffles and crescents - all chocolate, of course, under glass.

Larter is the celebrity face hired by the Belgian chocolatier for its annual Valentine's Day promotion contest. This year, anyone who buys the winning box of chocolates - for $23 and up - may win the chocolate room. It is to be re-created in a suite of Manhattan's Bryant Park Hotel for a pampered getaway weekend for two in May.

The winning box - sold only in North America - will contain a note informing the buyer of his or her good luck.

While no doubt a shameless commercial promotion - created by Los Angeles designer Larry Abel - the demo chocolate room set up on the sixth floor of an East Village building packed a tasteful, artsy punch.

Hanging in the "living room" was a painting built entirely of multicolored chocolate pieces inspired by Gustav Klimt's painting "The Kiss." Above the dining table was a "canvas" dripping with brown and white chocolate - a takeoff on Jackson Pollock's signature "drip" paintings.

And instead of words, books opened to a mound of chocolates.

You could actually sit on the plush sofa, which was chocolate-graced only on its sides, and the walls are made of chocolate.

There were a couple of "dont's" in the room: lighting the fireplace (with its chocolate logs and mantle) and the candles (all chocolate).

In addition, sinking into the easy chairs was discouraged - unless you wanted to rise with a chocolate-covered derriere.

Godiva is owned the Campbell Soup Co.

Starbucks to Cut Breakfast Sandwiches

SEATTLE (Jan. 31) - The scent of ham, eggs, cheese and bacon will soon stop competing with the aroma of coffee in Starbucks stores as hot breakfast sandwiches become the first casualty of the company's battle to win back customers.

The sandwiches, which will disappear by this fall, boost a typical store's annual revenue by $35,000, so pulling them off the menu will cost at first. Chairman and Chief Executive Howard Schultz said that proves the company isn't letting the soft economy distract it from committing to big changes that will pay off over the long haul.

"The decision and the courage it takes to remove something when there's pressure on the business - like the sandwiches - is emblematic that we're going to build for the long-term and get back to the roots and the core of our heritage, which is the leading roaster of specialty coffee in the world," Schultz told The Associated Press on Wednesday after the company released its financial results for the first fiscal quarter.

Starbucks Corp.'s profit rose by less than 2 percent, as U.S. customers grappling with a soft economy lined up in smaller numbers for a second quarter in a row.

Sales at stores open at least 13 months, a key measure of a retailer's health, fell 1 percent in the U.S. as traffic declined 3 percent - the second consecutive quarter. Stronger growth overseas helped boost global comparable-store sales a modest 1 percent, compared with 6 percent in first quarter 2007.

For the 13 weeks ended Dec. 30, Starbucks posted net earnings of $208.1 million, or 28 cents per share, up from $205 million, or 26 cents a share, during the same period a year ago.

Analysts polled by Thomson Financial were expecting a profit of 27 cents per share.

Revenue for the quarter was $2.77 billion, in line with analysts' estimate and up from $2.36 billion a year ago.

Starbucks shares fell 75 cents, or 3.8 percent, to close at $19.22 Wednesday, then fell another 28 cents in extended trading after the results were released. The company's stock is down about 50 percent since late 2006, when it was trading close to $40 a share.

Sharon Zackfia, an analyst with investment firm William Blair & Co., said the lackluster quarter came as no surprise. "I think an investor would have had to be living in a cave not to know that the December quarter was bad for the majority of retailers," she said.

As part of a broad push to revitalize its business, the company said it plans to open about 425 fewer domestic stores and 75 more overseas than previously planned, for a global total of 2,150 new stores. Starbucks has more than 15,700 worldwide.

Schultz said the slowdown in U.S. growth will allow the company to make better use of its time, money and staff and could reduce "cannibalization" - easing pressure some stores experience when a new one opens nearby.

Analysts have been eager for specifics on Schultz's turnaround plan for Starbucks, which has struggled with its own rapid growth, high dairy costs, declining traffic in U.S. stores and competition from cheaper rivals.

But Schultz said the company won't release details, including "five bold innovations," until its annual shareholders meeting in Seattle on March 19.

Starbucks has been testing $1 extra-small cups of drip coffee with free refills in some Seattle stores, which Schultz said it's doing to respond to the economic pressures many of its customers are facing. Some analysts say it could draw in new customers and drive up sales if they decide to upgrade to a $4 mocha or other high-margin espresso-based drinks.

By 2009, Starbucks said it aims to open more stores overseas than domestically for the first time - more than 1,000 stores in its international markets, where Schultz has said he sees enormous potential for growth, and fewer than 1,000 in the U.S.

The company said it expects low double-digit earnings-per-share growth this fiscal year because of the company's efforts to improve operations and "continued macroeconomic weakness."

That could drag earnings below the company's previous target of $1.02 to $1.08 per share. The company earned 87 cents a share last year, and it did not release an updated target for fiscal 2008.

IRS Warns of Tax Rebate Scams

WASHINGTON (Jan. 31) - Even before Congress passes an economic stimulus package, identity thieves are using promises of tax rebates to trick people into revealing financial and personal data, the Internal Revenue Service warned Wednesday.

Under one scheme, the IRS said, people are receiving phone calls telling them they can only receive a rebate if they provide bank account information for a direct deposit.

The tax agency stressed that it does not collect information by telephone and that no legislation has been enacted that would allow it to provide advance payments to taxpayers or that specifies the details of those payments.

The House last week, as part of an economic stimulus package, approved tax rebates of $600 and $1,200 respectively for most individuals and couples, with another $300 per child. The Senate is now considering a slightly different version.

The IRS also repeated past warnings of e-mails, supposedly coming from the agency, where people are asked to enter personal information on a form needed to obtain a tax refund.

A new scam, it said, involves an e-mail notification that a person's tax return will be audited with instructions to click on links to complete forms with personal and account information.

Businesses and accountants are also getting e-mails with instructions to download information on tax law changes. Clicking on these links could download "malware" onto the recipient's computer that gives the scammer remote access to the computer hard drive.

In another telephone scam, a caller claims to be an IRS employee who says the taxpayer has not cashed a refund check and asks the person to verify his or her bank account number.

On Tuesday, at a Senate Finance Committee confirmation hearing for Douglas Shulman, the nominee to be IRS commissioner, Sen. Charles Schumer, D-N.Y., expressed concern that taxpayers would be victimized by tax preparers and lenders who charge high interest rates for short-term advances on their stimulus rebates.

The IRS advised people not to click on any link from an e-mail purporting to come from the tax agency. People receiving questionable e-mails can contact the IRS through phishing@irs.gov.

Amazon’s Profit More Than Doubles

For Amazon.com, the fourth quarter was even sweeter than usual. But Wall Street reacted negatively because profit margins slid slightly.

On Wednesday the company announced that fourth-quarter profit more than doubled to $207 million, or 48 cents a share, from $98 million, or 23 cents a share in the fourth quarter last year. It reported sales of $5.67 billion, up 42 percent from $3.99 billion in the quarter last year.

The fourth quarter, which includes the critical holiday shopping season, is reliably the company’s strongest period, and this year proved no different.

“This quarter showed accelerated sales growth and record operating profits,” Jeff Bezos, the chief executive, said in a statement released with the earnings. “In our view, these unusual financial results are driven by one thing: continuously improving the customer experience.”

Analysts had forecast earnings of 48 cents a share on revenue of $5.37 billion for the quarter, according to current estimates from Thomson Financial.

Despite the robust report, Amazon shares were down 11 percent in after-hours trading. Analysts pointed to weaker profit margins. Amazon’s gross margin fell in the fourth quarter to 20.6 percent from 21.3 percent, a year earlier, as the company continued to invest in new technology.

Before the company announced its financial results, shares of Amazon rose 26 cents to $74.21.

Amid fears of a slowdown in consumer spending causing jitters on Wall Street, Amazon forecast sales in the current quarter of between $3.95 billion and $4.15 billion, an increase of between 31 percent and 38 percent from first quarter 2007.

It said operating income is expected to grow as much as 38 percent in the first quarter.

Sales for the entire are forecast to grow between 26 percent and 33 percent over 2007, the company said.

Amazon.com’s stock price has been on a wild ride this past year, reaching just over $100 a share in October, dropping into the $70 range in November, only to start the year at $96.25.

During the fall, Amazon introduced an electronic book device called the Kindle and an online store where customers can download e-books. Analysts had not expected that product to have a significant effect on the fourth quarter.

Last year, the company also introduced the Amazon MP3 digital music store to sell downloaded music, including tracks from EMI and Universal, making it a significant competitor to Apple’s iTunes.

Fed cuts as growth stalls

WASHINGTON — Armed with new evidence indicating economic growth virtually stalled late last year, the Federal Reserve on Wednesday announced another half-point cut to its benchmark lending rate in a bid to prevent a recession.

The Fed reduced its federal-funds rate — the overnight rate banks charge each other — to 3 percent. Commercial banks mirrored that move, lowering their prime rate — which they charge their best borrowers — to 6 percent.

The Fed also made a half-point cut to the rate it charges banks for emergency borrowing.

When the Fed began cutting in September, its benchmark rate was 5.25 percent and the prime rate was 8.25 percent.

Lower rates make it cheaper to take out a car loan, pay off credit-card debt or buy inventory for a small business. But turbulent credit markets and a deep slump in the housing sector may mute some of the benefits of the rate cuts, whose effects in any case won't be felt across the broader economy for months.

Banks and other lenders have become reluctant to work with anyone but borrowers with impeccable credit histories.

The Fed alluded to this Wednesday.

"Financial markets remain under considerable stress, and credit has tightened further for some businesses and households," it said. "Moreover, recent information indicates a deepening of the housing contraction as well as some softening in labor markets."

The Fed's statement left open the possibility of more rate cuts in the months ahead.

"Today's policy action, combined with those taken earlier, should help to promote moderate growth over time and to mitigate the risks to economic activity. However, downside risks to growth remain," it said.

Economic-growth data released Wednesday by the Commerce Department underscored how much housing is hurting the broader economy.

Investment in residential housing fell by the largest quarterly amount since 1981, and that's off-setting the Fed's efforts to jump-start the economy.

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"The principal link between monetary policy and the economy is the housing market, and this link is being short-circuited by the housing recession," said Mark Zandi, the chief economist for Moody's Economy.com, a forecaster in West Chester, Pa.

The latest Fed cuts came on the heels of an unusual emergency three-quarters-of-a-point reduction in the federal funds rate Jan. 22. Faced with deep drops in stock markets across the globe and anticipation of similar slides in the United States, Chairman Ben Bernanke took dramatic action.

The reasons for his concern became clear Wednesday morning, when the Commerce Department data showed economic growth in the fourth quarter of 2007, as measured by the gross domestic product, slowed to 0.6 percent.

That's about half of what most mainstream economists had forecast and the slowest rate in five years. It suggests the economy had virtually no tail wind going into what's been a volatile new year so far.

The full-year growth rate for 2007 was 2.2 percent, compared with 2.9 percent in 2006.

President Bush and Congress are rushing to put together a stimulus plan, hoping the combination of tax rebates for consumers and tax breaks for businesses will spur consumer spending, which drives two-thirds of U.S. economic activity.

The $150 billion stimulus measure passed the House on Tuesday.

But the Senate began modifying it Wednesday to provide economic assistance to the poor and elderly, possibly putting the two chambers at odds and raising the prospects of a presidential veto and delay.

Wednesday's economic data underscored why quick passage of a stimulus plan is so important.

The new data confirm consumer spending is slowing and that consumers have less money left after meeting their basic needs.

Consumer spending rose 2 percent in the fourth quarter, down from 2.8 percent in the third quarter. It contributed 1.37 percentage points to economic growth in the fourth quarter, down from 2.01 percentage points in the third quarter.

Real disposable personal income grew 0.3 percent, well off the 4.5 percent increase of the previous quarter.

The troubled housing sector negated almost all gains from consumer spending.

Investment in residential housing fell 24 percent from October through December, shaving an estimated 1.18 percentage points off the economic growth rate.

In previous quarters, growing U.S. exports had off-set the negatives from housing. But in the fourth quarter, exports contributed less than half a point to the economic growth rate.

The biggest surprise in Wednesday's important data was that business inventories fell during the last three months of last year.

In the past, such a drop was a sure sign of recession.

But inventory management has grown more precise in recent years, and the drop in inventories could signal companies are well-positioned to operate in a slower economy.

"The inventory drawdown was nearly all in vehicle inventories. The auto manufacturers won't be building [more of] them anytime soon," Zandi said.

"Inventories elsewhere aren't overladen but not lean either," he said. "Inventory changes are unlikely to play a role in determining overall growth during the first half of the year."

Whether the economy grows slowly or gets mired in recession depends on how businesses spend and hire.

December's weak employment numbers led many economists to increase the chance of recession, and the eyes of Wall Street and Main Street now turn to the Labor Department's release of January employment data Friday.

Stocks rise on rate cut hopes

NEW YORK - A jittery Wall Street advanced Monday, reversing some of Friday's sharp losses as investors took a dismal new home sales report as a sign the Federal Reserve will lower rates this week.

The Dow Jones industrial average rose more than 176 points in a session that was relatively calm when compared to the turbulence of last week.

On the surface, the advance appeared surprising after the Commerce Department reported sales of new homes in December fell by 4.7 percent and that 2007 new home sales plunged by a record 26.4 percent compared to 2006. But while the report at first exacerbated the market's concern that the housing and mortgage crises are causing a recession, it also raised hopes that the Fed might cut rates again by a wide margin to stoke the weakening U.S. economy.

"Anticipation of another Fed rate cut is the main magnet in the market today," said Alfred E. Goldman, chief market strategist at A.G. Edwards & Sons Inc.

He was skeptical the gains would stick — anything the Fed decides after its two-day meeting lets out Wednesday could be met with disappointment. If the rate cut is small or nonexistent, the market will likely be unsatisfied; if the cut is wide, the market may worry the economy is worse than it thought.

"If we do rally into a Fed rate cut, we have a lose-lose situation," Goldman said.

And traders who bet on the Fed's next move were pricing in a more than 80 percent chance of a half-point cut.

"Any less than that could be a problem," said Richard Sparks, senior equities analyst at Schaeffer's Investment Research.

According to preliminary calculations, the Dow rose 176.72, or 1.45 percent, to 12,383.89 by late afternoon after falling as many as 95 points in morning trading. On Friday, the blue chip index tumbled 171 points after a two-day advance of more than 400 points.

Broader stock indicators also advanced Monday. The Standard & Poor's 500 index rose 23.36 or 1.76 percent, to 1,353.97, while the Nasdaq composite index rose 23.71, or 1.02 percent, to 2,349.91.

Government bond prices slipped as stocks rose. The 10-year Treasury note's yield, which moves opposite its price, was at 3.59 percent, up from 3.58 percent last Friday.

Alexander Paris, economist and market analyst for Chicago-based Barrington Research, said most investors were waiting for the Fed to announce its decision on Wednesday before making any big bets. That was one of the reason for a quiet trading day where the Dow stayed mostly in positive territory.

"It was calmer than I expected it would be, especially when you have lots of news for investors to look at," he said. "But, it's the Fed offsetting the news — and people don't want to make a big move when you don't know what they're going to do about interest rates."

However, trading for the week is expected to be volatile as Wall Street digests President Bush's final State of the Union address Monday evening and the Fed's rate announcement Wednesday. Last Tuesday, in an emergency move, the Fed lowered rates by 0.75 of a percentage point.

Hopes for another large cut on Wednesday had been tempered late last week by news that French bank Societe Generale sold European index futures to close positions taken by an alleged rogue trader. It is thought those trades may have aggravated the massive losses in Europe and Asian trading last Monday, when the U.S. markets were closed.

Profit reports Monday were ostensibly upbeat, but revealed some troubling signals about the economy. Fast food seller McDonald's, a Dow component, said its quarterly profit rose 3 percent due to tax benefits and strong sales, but December U.S. sales were flat with a year ago as cash-strapped consumers pared back spending. McDonald's shares fell $3.03, or 5.6 percent, to $51.07.

Merger and acquisition news added to the market's uncertainty. Blackstone Group LP on Monday said it is still interested in buying Alliance Data Systems Corp., but that the $6.4 billion deal is in jeopardy because regulators want to place onerous terms on the takeover. ADS dropped $23.12, or 35 percent, to $42.48. Blackstone slipped 21 cents to $19.15.

The dollar fell against most major currencies except the yen, and gold prices rose.

Crude oil rose 28 cents to settle at $90.99 a barrel on the New York Mercantile Exchange.

Advancing issues outnumbered decliners by nearly 3 to 1 on the New York Stock Exchange, but volume was a relatively low 1.39 billion shares.

The Russell 2000 index of smaller companies rose 13.79, or 2.00 percent, to 702.39.

Asian trading saw steep losses — in Tokyo, the Nikkei stock average dropped 4 percent and a key index in Shanghai plunged 7.2 percent. In Europe, London's FTSE 100 fell 1.36 percent, Frankfurt's DAX rose 0.03 percent and Paris's CAC 40 lost 0.61 percent.