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Four top business stories of 2006 and predictions for 2007

It is year-end retrospective time and here at Bloggingstocks and AOL Money & Finance, we've been taking our own look back, featuring for the past month the Best & Worst in Money for 2006 and asking readers to vote for their their favorites in lots of different categories -- including the biggest business stories.

The results are in. The following are some of the top stories of 2006, what the voting told us about public perceptions and what that signals for 2007:

Gas Prices. They peaked in the middle of the year at $3 a gallon – just high enough to seriously dampen consumer spending, cause people to start abandoning their SUVs and create worries about $5 a gallon gasoline. Prices slid in the second half of the year to today's more comfortable $2.30 level. Still, in AOL Money & Finance's voting for the biggest business story of the year, higher gas prices got more than 60% of the votes.

Prediction for 2007: Gas prices will stay at the $2.50 range with temporary spikes up to $3 when tensions flare in the Middle East or supply is disrupted around the world. Stocks of companies like ExxonMobil Corporation (NYSE:XOM) and Valero Energy (NYSE:VLO) will continue to prosper.

Enron's Ugly Endgame. The demise of Enron five years ago is probably the major story of the decade. Still, this year's chapter – the conviction of Enron's Ken Lay/Jeff Skilling along with Ken Lay's unexpected death – was also one of 2006's biggest business stories. Americans who followed the saga were shocked and appalled when Ken Lay died of a sudden heart attack in July, vacating his conviction. In mid-December Skilling began serving a 24-year term, seemingly putting an end to the law and order side of the sorry tale of greed and corruption.

Prediction for 2007: Now that Enron's top executives are behind bars or dead, the public will start to forget about how damaging corporate greed can be, paving the way for whittling back of tough-on-business legislation and more scandals in years to come.

Hewlett-Packard's corporate spying campaign. In terms of sheer number of headlines and magazine covers, the paranoid and probably illegal actions of Hewlett-Packard Company (NYSE:HPQ) 's corporate board, which was trying to find out who among its ranks were leaking information to the press, is one of the biggest stories of 2007. The incident had no problem making the top ranks as one of AOL Money & Finance's Dumbest Moments in Business. Patricia Dunn, then chairman of the board, took most of the blame for the scandal. Lucky for HP, its stock soared in the second half of the year as its sales and profits rebounded nicely under Mark Hurd, enabling him and the company to escape much of the fall-out so far.

Prediction for 2007: With shareholders so happy with how HPQ is doing, this sad tale will likely be forgotten soon after the new year. My fear is that the enduring image will be of another top female exec screwing up, making it harder for more women to reach the top corporate ranks.

Softening Real Estate Market: The soaring real estate market was one of the happy business stories of recent years, but 2006 was the year some of the air came out of the bubble. Real estate prices are falling, but it's unclear how much they will fall. Sellers seem to be holding out for top dollar when they can. Since panic selling has not set in, the market has only stumbled at this point. Lower mortgage rates in the second half of the year made homes more affordable, bringing in buyers and curbing what could have been a major slide. People are getting tired of this topic, which is healthy. In our poll, "housing bubble" got nearly 50% of the votes for being the "most overused buzzword."

Prediction for 2007: Home prices will stabilize in most parts of the country and even perk up a bit overall. At the same time, foreclosure rates will continue to rise as homeowners who used risky low-interest adjustable rate mortgages have trouble making payments as their rates adjust upwards.

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Last updated: July 09, 2008: 07:30 AM

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