The U.S. economy expanded at an annual rate of 0.6% in Q4 2007, below the consensus estimate, as activity in construction and consumer spending declined, The U.S. Commerce Department announced Thursday, in a statement.

Economists surveyed by Bloomberg News had expected the economy to grow at a 0.7% annualized rate in Q4 2007. The economy grew at a 4.9% pace in Q3 2007, the Commerce Department said.

For 2007, the economy grew at its weakest pace in five years, with GDP increasing at an inflation-adjusted 2.2%. GDP increased 2.9% in 2006. In 2007 the nation's GDP totaled $13.84 trillion, not adjusted for inflation.

In Q4 2007, a stronger performance in trade offset sub-par performances in consumer spending, business investment, residential investment, and inventories.

This post is part of our Hottest Products of 2007 feature. Check out our other Hottest Products of 2007 posts and let us know which product you think is the greatest thing since sliced bread.

If you find life a little boring, stifling and basically bland, then you may be a prime candidate to check out one of this year's hottest properties. Second Life is for people who wish to expand the boundaries of their life experience. Second Life opens up opportunities (albeit virtual ones) that most people would never encounter in their own personal daily grind. Much of the "news" that surfaces in mainstream media regarding Second Life is just dicey, sensationalist spin. What we want to know about are the things that make Linden Lab's Second Life worthy for consideration as a product of the year.

A good place to start investigating is Second Life Insider, a blog dedicated to tracking that constantly changing virtual environment. For instance, did you know that Second Life has an economy of its own, which actually maintains an exchange rate against real American dollars? It's true, and according to Second Life Insider, on November 1, Second Life membership invested U.S. $1,372,000 into Linden dollars (the site's virtual currency) at an exchange rate of L$268.7 to one U.S. dollar. In fact, there was quite a moan put out by the IRS at the beginning of this year when they again realized that people do generate significant income in virtual spaces.

Shares in internet search behemoth Google, Inc. (NASDAQ: GOOG) recently rose to their highest level ever, giving the company a market capitalization figure (briefly) of over $200 billion. For a company that does not exist except in the virtual sense, that's impressive. The company makes no physical products (save for corporate search appliances) and rose to that level in just over three years on the public market. Is this for real?

Well, Google's recent quarterly earnings have shown that, so far, it is. The company just continues to make money hand over fist in the internet search arena, and has worked many acquisitions into itself to prepare for the day when -- gasp -- it can't grow by leaps and bounds on search results-based text advertising prowess alone. The company reported huge Q3 earnings today, with revenues of over $4.23 billion.

Analyst consensus expectations were for a $3.25 EPS figure, and Google smashed that with a $3.38 (GAAP) figure. So, stay tuned below as we'll hear what Google execs have to say about yet another record-setting quarter. Be sure and use the "Refresh" key to make sure you catch all the minute-by-minute updates below. All times are in EST.

While attendance at the counter-culture Burning Man festival might add credibility to any edgy artist's bio, it's definitely not the sort of thing you'd put on your investment banker's resume under "Interests." Yet according to Portfolio, financiers and executives are turning Burning Man into the latest substitute for golf retreats and spa getaways. When one executive returns from a week or two on the playa, he says, "I'm a far better executive, in terms of innovation and creativity."

Ahhh... now I understand the ad campaign for Rozerem. But let's put the sarcasm to the side for a moment and examine this, just like Portfolio does. After all, corporate retreats have long been held in locales where their participants are encouraged to turn off the mobile phones and Blackberries and the like and to connect with each other and their inner leader. What better place than Burning Man, where not only is wireless reception virtually nonexistent, but you can't even buy a candy bar (or a Wall Street Journal, or a stick of deodorant, or, well, anything). Commerce is banned altogether; you aren't allowed to even barter. Why not hold your retreat at such a disconnected locale?

Oh! Oh! I know this one. It's because Burning Man is seen as a haven for drugs and consequence-free sex (naturally, its proponents and organizers insist it's just about the art).

This week's U.S. News & World Report, (August 13) features a series of articles collectively entitled "1957 -- A Year That Changed America Culturally, Scientifically, and Politically."

In the issue the magazine "takes a look at this seminal year -- one that planted the roots for a new America." Among the reports included:

• "Eisenhower Confronts a Political and Moral Crisis in Little Rock"
• "Sen. Strom Thurmond Sets a Filibuster Record to Hold Off Integration"
• "With Launch of Sputnik, the Soviets Open a New Frontier and Ignite the Space Race"
• "John Glenn Orbits the Earth, Setting Another Record"
• "The Dodgers Move to California, and the World Follows"
• "From the Wreckage of World War II Came a Vision for a Unified Europe"
• "The Bloody Battle of Algiers Demonstrated a Terrorist Playbook"
• "Ghana's Independence Set Off a Chain of Freedom in Africa"
• "The Edsel Went From Wundercar to Laughingstock"
• "The Laser Beam Revolutionized Medicine and Industry"

Were you watching CNBC after the market close today? If so, you may be cancelling your plans to sink all your home's equity into a big remodel. In an unusually frank and sober prediction, D.R. Horton, Inc. (NYSE:DHI) CEO Donald Tomnitz told the audience of millions of market watchers that "2007 is going to suck, all 12 months."

David Gaffen from the Wall Street Journal's MarketBeat blog was watching, and he wonders if it's not just a reaction to D.R. Horton's not-exactly-stellar stock performance. Though only down a penny today to $24.55, the stock is off 20% since its February 2, 2007 high near $31 -- a rough month, indeed.

The good news (sort of)? Tomnitz thinks 2008 will be better. Not good. Better than the suck-icious 2007, at least. Is this a case of let's-give- the-worst-case-projection-and-hope-no-one-blames-me-when-it- happens? Or is it really true? Either way, the homebuilder's stock isn't doing any better since his words; it's down over a percent in after-hours trading.

I, for one, won't bail out of the market but I think I'll wait to refinance... with this kind of talk, the only thing I see on the horizon is cheaper interest rates. And I'm certainly not going to hire Donald to run pep rallies anytime soon.

When Starbucks Corporation (NASDAQ:SBUX) presents its fiscal first quarter 2007 earnings on January 31, the company might want to roll out a new numbered cup, with the quote, "Can't Starbucks just serve its holiday beverages year-round?" Its eggnog lattes and maple macchiatos have customers slurping each winter, and investors licking their lips in anticipation of seasonally spicy earnings.

According to First Call, analysts expect the coffee retailer to earn 26 cents a share, a big bump of 36% over the year-ago quarter. But for analysts who are hoping for a whopping growth rate? They don't sound so hopeful. William Blair analyst Sharon Zackfia is worried about the holiday merchandise -- the red ceramic mugs, the CDs, the bears. "Starbucks' pre-holiday markdowns on seasonal merchandise were earlier and more aggressive this year and post-holiday inventory levels were higher leading to subsequently deeper markdowns," she wrote, and it's certainly true that the Starbucks outlet on my corner was packed with holiday goodies in the weeks after Christmas (we picked up a set of coffee-cup ornaments for half price).

With a wealth of small changes to its business -- including a bigger focus on low-margin, but not labor-intensive items like books, music and those pretty red-themed mug; a bigger push into breakfast with eggy biscuity sandwiches; and a focus on spending more for more socially reponsible coffee -- the variables are many. And investors are skeptical; in the three months since the last earnings release, the stock is down about 13%. Are you really this skeptical?

Also check out some other earnings reports that we're following, and let us know your thoughts on earnings expectations.

Steve Jobs knows his audience. And the audience at the MacWorld 2007 conference keynote (speaker, as always, the mock-turtlenecked Steve Jobs, but in brown -- a jab at the Zune perhaps?) had been camping out 'since nine the night before.

So it was to no small applause when he took the stage around 9 a.m. here on the West Coast. And everyone was on the edges of his and her seat waiting for the Big News.

Naturally, in our opinion here, the Big News is the iPhone. We've been wondering about it for months, giving it optimistic release dates (hey, still could happen, right?) and wondering whether Apple Computer, Inc. (NASDAQ:AAPL) could even call it that, given that the trademark to the name is owned by Linksys. And, basically, loving it from afar. Well, it's true, and it is called the iPhone, and Engadget reports Jobs saying that it will be a "leapfrog product," it will include an iPod (duh), a widescreen with touch controls, and it will be a "breakthrough internet communications device," whatever that is.

Also big news from Steve was that the Apple TV will be shipped in February; lots of details over at Engadget, photos of the interface and lots of details on how it will work. There is also ridiculous eye candy coming up every minute on the iPhone. I can't wait to do a montage!

Great companies and great stocks can be found everyday and everywhere you look. However, sometimes we look but we do not see. How can that be? Sheldon Liber brings a brighter light to illuminate picks for 2007 and beyond. Valero Energy (NYSE:VLO) is his seventh of seven for 2007.

Valero Energy (NYSE: VLO) This is an unbelievable value in my opinion, and even more incredible because it has been hiding in plain sight. This stock has gotten some attention because it has a P/E of 5.8. That will get a lot of people's attention. But the metrics for this company are amazing, top to bottom. I have been discussing low P/S ratios in this story and for VLO the figure is 0.39. Yesterday this stock closed at $52.01. That means if the price tripled, to $156.03, yes tripled!, the P/S would only be 1.17 which is very very low. Try finding any other large cap companies with that low a P/E and P/S. There are not many, and they are usually stocks of companies that are out of favor, and deserve to be.

There is much more to the story. The book value, a favorite of Graham and Buffett, is 1.83. Well, it is not less than 1.0, which is what they would be looking for. But consider this: VLO has hard assets like refineries and land, whose book value has to be tremendously understated, since they are all old ledger entries. That tells me the 'real' book value is far greater than it would be if the company's assets were re-appraised to current value -- meaning that 1.83 might very well approach 1.0.

Great companies and great stocks can be found everyday and everywhere you look. However, sometimes we look but we do not see. How can that be? Sheldon Liber brings a brighter light to illuminate picks for 2007 and beyond. Time Warner Inc. (NYSE:TWX) is his sixth of seven for 2007.

Time Warner Inc. (NYSE: TWX) On this one James Cramer and I agree 100%, but I was there first! We are in at $12.10. I also agree with Cramer that TWX could easily be $28 to $30 per share in a year. The company has cleared out a lot of old baggage, reduced debt, bought back shares, completed the acquisition of Adelphia, now Time Warner Cable and cleaned up the Comcast relationship. Management has made bold moves with AOL, radically changing the business plan, now offering free service and continue to focus each business segment. Even BloggingStocks.com has grown tremendously since TWX bought Weblogs, Inc. in October 2005.

There are some notes of caution because few stories are perfect. When I first noted the value in TWX months ago its P/S was 1.24 -- the lowest of our BloggingStocks -- and I said, very worthy of consideration. Now it is 2.34, so this is not what is driving my interest. The P/E of 19.87 is no bargain, either, and the ROE, ROA and ROIC are way to low for me to even discuss. What I think is compelling about the story is that TWX is just now beginning to come out of its shell. Parson's honeymoon period is long over, new large shareholder Icahn is looking over everyone's shoulder, the cable business is ready to rock big time, and AOL finally has clear direction and a rudder. And BloggingStocks ... well, who knows -- great editors, great team, great potential!

TWX does pay a dividend yield of 1% but it should be higher. If it does not increase ROIC than the company should give the money back to us, the shareholders. I expect that we will see the metrics improve significantly over the next few quarters as it reports growing earnings. (Read the Company Profile.)

Great companies and great stocks can be found everyday and everywhere you look. However, sometimes we look but we do not see. How can that be? Sheldon Liber brings a brighter light to illuminate picks for 2007 and beyond. PetroChina (NYSE:PTR) is his fifth of seven for 2007.

PetroChina ADR (NYSE: PTR) Okay, I admit it, I love this company! I bought it at $44 and again at $55 per share. You could have bought in at anytime in the last two years and made good money. This is one of my best buys ever and I have been beating this drum promoting it since I have been writing for AOL, so if you never bought in, it was not because you did not have any notice. When I first mentioned PTR about seven months ago it was around $100. Its all time high is $140.49 and it closed last night only pennies less $140.42. That is an annualized return of 70+%. I give Barron's full credit for bringing this company to my attention, and they did so prior to the release of information from Berkshire Hathaway indicating that Warren Buffett purchased $1.3 billion dollars of the company. Give Buffett credit though, he did see it first...again.

I cannot tout PTR as being a bargain based on the P/S of 3.51. There are a lot of people following this company and, the faster it has gone up, the more attention it gets, as it hits new highs every few days. What I can say is there is a chance it will come down in the next few months after an earnings report and some profit-taking, or maybe some relief in the price of oil. When it does I would jump in with both feet. When I first examined this company and its future potential I found a P/E of 9.5, a P/S of just over 1.0 offering a 5.4% yield or there abouts. So in this world where there are no sure things I thought I had found one. You can be absolutely sure that the people of China will use more oil tomorrow than they did yesterday, more this year than last, and that will go on for many decades!

Great companies and great stocks can be found everyday and everywhere you look. However, sometimes we look but we do not see. How can that be? Sheldon Liber brings a brighter light to illuminate picks for 2007 and beyond. The Home Depot, Inc. (NYSE:HD) is his third of seven for 2007.

The Home Depot Inc. (NYSE: HD) -- Like many of my picks, you will find I look for out-of-favor companies with depressed stock prices and compelling stories, while ignoring most analyst banter. Home Depot has been buying back shares all year, and on December 14, 2006 it announced it would buy back another $3 billion worth -- why? While sales and profits are growing, its same-store-sales have been depressed by the reduction in housing starts and declining home sales in many markets. Its shareholders have been restless and a buyback is a quick way to add shareholder value. It also shows confidence in the current value and supports it at the same time. HD closed yesterday at $39.56.

Starting again with the P/S ratio of 1.05 we find another eye-opener, and it has a below average P/E of 13.66 with an above average yield of 2.31%. Again, we find the ROE, ROA and ROIC all top the P/E: Return on Equity (TTM) 22.98 Return on Assets (TTM) 14.21 and Return on Investments (TTM) 20.7.

Great companies and great stocks can be found everyday and everywhere you look. However, sometimes we look but we do not see. How can that be? Sheldon Liber brings a brighter light to illuminate picks for 2007 and beyond. Dow Chemical Company (NYSE:DOW) is his first of seven for 2007.

The Dow Chemical Company (NYSE: DOW): Dow has been trending downward for over two years from its high of $56 per share. Last night it closed at $40.14 -- roughly the same share price as three years ago. If you are interested in technical analysis (which I'm not), you might note that Dow seems to move in three-year cycles. I think the important thing to note here is that some companies operate in cyclical businesses, which is more important than the chart shapes.

According to my personal investment strategy, price-to-sales is a better indicator of future performance than price-to-earnings. With that in mind, please take note of Dow's price-to-sales ratio of 0.85. Anything approaching 1.0 is worthy of investor attention. The rationale for this is based on top line sales being harder to manipulate than bottom line earnings. Those interested in the more closely followed price-to-earnings ratio will be happy to learn that it is now around 10, or about eight points less than the Dow Jones industrial average.

While the P/S and P/E ratios are good attention-getters, there must be more to clinch the deal. Check out Dow's Return on Equity (for the trailing twelve months) of 32.56, Return on Assets (TTM) of 11.87, and Return on Investments (TTM) of 18.52 -- all far greater than its P/E. This tells us that management is able to generate a return higher than we are paying to acquire that return.

I'm not a fan of making resolutions on January 1; I believe, if something about your life needs to change, it should just change now. And yet, every year, I get caught up in the spirit of the season of new beginnings, and start dreaming about how great I will be when I start doing yoga regularly, eating a green vegetable every day, and sitting down to a family meal together (without TV!) at least once a week.

Financial resolutions, however, make ever-so-much sense to coincide with hanging your brand-new calendar. A new year often means a new salary and perhaps a new bouncing baby tax deduction, and is a great time to re-evaluate your investments. But a few commitments stand out as being so brilliantly beneficial and (often) easy that most of us would do well to adopt them:

1. Contribute to your company's 401(k), or an individual IRA. If your company has a 401(k) plan and you're not contributing, well, get thee to an election form immediately! 401(k) contributions are pre-tax, so for someone in my (average) tax bracket, a $150 monthly contribution only takes about $100 from my paycheck -- an amount roughly equal to the amount of money I would have wasted, was it there in my bank account instead of silently creating wealth for me. If you're already contributing, consider increasing your contribution by a percentage point or two; likely, you'll barely notice it.

2. Evaluate your 401(k) or IRA investing decisions. I managed the 401(k) plan for my small company about five years ago, and was amazed to find that I was the only one who made any investment choices with my money; every other employee had his or her money sitting in the default option, a money market fund (most yield only a few percentage points a year, often less than inflation). If you have any money in your 401(k), pick something, even if it's a very conservative mutual fund or bond fund.

If you've made an election in the past, but your entire retirement portfolio is in one bond fund or (yikes!) 100% invested in your company's stock, take a look at the options and diversify a bit. Ideally, you'd have three or four different funds in your 401(k) or IRA, if you can't invest in individual stocks -- and, even though I haven't always followed this advice, after the Enron saga I'd never invest more than 20% of my portfolio in one stock (yes, especially your employer's stock).

As 2006 winds down and C-level executives begin their month long ski vacations, journalists begin struggling to come up with interesting finance articles to write, and will turn to the annual tradition of forecasting what will take place next year. It has already started: Barron's (subscription required) cover article this past weekend was titled "Outlook 2007."

Although these articles can be quite interesting, their value for investors in null. To illustrate this point, I dug up an article from well-respected M&A website TheDeal.com (subscription required) which was written February 1, 2006. Here is a quick look at its predictions for 2006.

Giving credit where it is due, here are the correct predictions the article made:

• Liberty Media's (NASDAQ: LCAPA) John Malone will sell his stake in News Corp (NYSE:NWS) to Rupert Murdoch [OK, I'm giving them this one, because it seems that from where discussions are now, this will happen in the very near future]

• Actional would be acquired [The article cited Sun Microsystems (NASDAQ: SUNW) and Hewlett-Packard (NYSE: HPQ) as suitors, Actional was actually bought by Progress Software (NASDAQ: PRGS)]

Here are some of the incorrect predictions the article made:

• Yahoo (NASDAQ: YHOO) would buy Lions Gate Films (NYSE: LGF) [Lions Gate stayed independent and rose 43% YTD]

• Verisign (NASDAQ: VRSN) would buy Neustar (NYSE: NSR) [Neustar did the acquiring this year, buying Followop in November]

• A number of companies would be acquired or sold, including InfoSpace (NASDAQ: INSP), LookSmart (NASDAQ: LOOK), Mamma.com (NASDAQ: MAMA), Miva (NASDAQ: MIVA), Rackable (NASDAQ: RACK), aQuantive (NASDAQ: AQNT) and ValueClick (NASDAQ: VCLK). [None were acquired, and some of these targets were acquirers themselves]