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Investors are cheering as Facebook (FB) crushes Wall Street estimates in the fourth quarter.The social media giant beat on both the top and bottom lines as its revenue soared 30% from the previous quarter to $5.8 billion.Jim Anderson, CEO of SocialFlow, which uses algorithms to analyze user behavior on social media platforms to optimize clients' posts, told Yahoo Finance’s Alexis Christoforous that media companies are one reason for Facebook’s record-setting results. Facebook is gathering and garnering consumer attention,” said Anderson. “The vast majority of Facebook’s content in terms of reach comes from media companies. That’s the content that’s being shared,” said Anderson. “The media companies deserve a great deal of credit for the success of Facebook.”The number of users logging on to Facebook is increasing, and mobile is a key driver. The site now has 1.59 billion monthly visitors, with approximately 1.44 billion of those users visiting the site on a mobile device. The social media giant also said it now has 1.04 billion daily active users.It’s amazing how ubiquitous it’s become, especially on mobile devices. When Facebook went public, 0% of its advertising revenue came from mobile. Now, 80% of its advertising revenue comes from mobile,” said Anderson.About $5.63 billion of Facebook’s total revenue came from advertising, overshadowing its old payments business. Mobile revenue accounted for $4.5 billion.And that massive growth may not be over. Facebook still has many untapped revenue drivers at its disposal. The monetization potential for WhatsApp and Facebook Messenger have yet to be seen. And its Oculus VR plans to start shipping its $599 Rift virtual reality headset in March.
Low gasoline prices will lead more states to weigh changes in the gas tax. Among those looking: NY Pa Vt Va and WVa. Instead of a flat rate, some states have already set a minimum tax. NC for example, now ties the gas tax to population growth and broader energy prices. Ga is linking future tax levels to annual inflation and vehicle fuel efficiency. States have seen theri revenues fall as gas prices have dipped and as cars use less gas because of improved fuel efficiency. In many states, fuel tax revenues are a primary source of infrastructure repair funds.
States are creating new programs to help students refinance college loans. Leading the way: Calif. Conn. Iowa. Maine Minn ND and RI States are stepping up their efforts, now that the Treasury Depart is allowing them to use proceeds from selling tax exempt bonds to refinance offerings. Some studies note that 35% of all student debt is held by borrowers age 40 and over. Americans owe $1.3 trillion in student debt, triple the amount a decade ago
JANUARY NEWSLETTER P2
WASHINGTON (AP) -- The U.S. economy's growth slowed sharply in the final three months of 2015 to a 0.7 percent annual rate. Consumers reduced spending, businesses cut back on investment and global problems trimmed exports.
The slowdown could renew doubts about the durability of the 6½-year-old economic expansion.
The government's estimate Friday of the economy's expansion in the October-December period was less than half the 2 percent annual growth rate in gross domestic product in the third quarter. It was the weakest showing since a severe winter reduced growth to a 0.6 percent annual rate in last year's first quarter.
Activity should rebound in the current January-March period, though economists worry that China's troubles and sinking oil and stock prices could dampen the recovery.
A boost this year is expected to come mainly from consumer spending, which typically fuels about two-thirds of economic activity. Continued solid job growth could embolden consumers to spend more.
The Federal Reserve issued a cautious assessment of the economy this week. The Fed left interest rates unchanged after having raised its benchmark short-term rate in December from record lows. Many analysts think that economic weakness, subpar inflation and global pressures will cause the Fed to slow its pace of rate hikes this year from what had been expected to be four increases to perhaps only two.
For all of 2015, economists have estimated that the economy grew around 2.3 percent, about equal to the 2.4 percent growth for 2014. That would continue the economy's pattern of subpar growth since the Great Recession officially ended in June 2009.
For 2016, economists are forecasting another year of modest growth of around 2 percent. At the same time they have nudged up the prospects for a recession this year. While still low, the likelihood is now put at around 20 percent, though most analysts still see an outright recession as unlikely.
Many economists expect the strength in the domestic economy to offset weakness in export sales and in the U.S. energy sector, which has been slashing investment in response to the plunge in energy prices.
While economic growth was lackluster last year, hiring was not. The economy added an average of 284,000 jobs a month in the final quarter of last year. The unemployment rate ended the year at a low 5 percent.
Mark Zandi, chief economist at Moody's Analytics, has said he expects strong job growth to keep lowering unemployment and to help boost wages, which have lagged in this recovery. He said the extra consumer spending, which will be aided by lower gas prices, will likely support economic growth of around 2.5 percent in 2015.
Growth at that level is above the economy's potential right now, which many analysts put at around 2 percent, reflecting a slower pace of people entering the job market and slower productivity growth
Big gainers from the shift to cold weather in the East: Natural gas producers, which saw the benchmark gas price hit its lowest level in more than a decade last autumn because of mild weather. A colder pattern means more demand for heat in the densely populated cities of the Northeast, and it has already lifted gas prices. Note that gas output is starting to slip, also a bullish long term sign for investors. To be sure, gas prices swill not abruptly return to the balmy pattern of late fall. Look for natural gas futures contracts to hit $2.50 per million British thermal units or a tad more by winter's end, up slightly from today's level. Ramped up gas usage by power plants will push long term prices higher Strict emissions rules are prompting utilities to close older, coal fired power plants and replace them with new gas fired plants. Gas now generates more power than coal for the first time ever.