Recently, sources have revealed investors are dumping large amounts of money into Twitter.  There has been much speculation and rumors that Twitter.com could be prepping for an IPO.  Why else would companies dump $100 million into a company with zero revenue?

According to Bloomberg.com, the company is believed to be valued at $1 billion.  The only rationale for valuing the company this high is if they are ready to unleash a massive revenue plan or if they are going public.  Either strategy would require some type of plan to make some money for this social media company.  The traffic is there to form unbelievable potential to investors.

Currently, Nielsen states that there are over 25 million “Tweeple” throughout the world.  Businesses, celebrities and entrepreneurs really are beginning to take advantage of this unique site.  Ashton Kutcher is followed by 3.7 million.  He capitalizes on this to help raise awareness for his television productions and charitable causes.  Businesses keep customers up to speed on new products and events.  Entrepreneurs are sharing marketing and business tips with their followers.  Even pastors and motivational speakers are able to share quotes and inspiration.

Twitter really gained worldwide recognition because of the media and recent events in Iran.  When no reporters could get firsthand information during the election protests and ensuing violence this summer, they relied on Tweeple.  The value of its communication power became evident and had everyone asking, “What is this Twitter-thing?”  How could they possibly turn this traffic into money, though?

Almost every financial website covering Twitter agrees on two main ways revenue can be generated.  One is to create business applications, such as calenders and private messaging.  These business packages would open the lines of communication to employees worldwide.  The business possibilities are expansive.  The other main way for income is for them to go with the advertising route.

No matter what they do, they are poising for major profit generation.  Keep your eyes posted for the IPO and let me know.  I’m on Twitter at (www.twitter.com/joeylaw) and so is Wasabi Media Group (http://twitter.com/WasabiMedia).

What other ways can Twitter generate profits for its investors?

It’s the Law of Unintended Consequences. Whenever the government intervenes in the market, no matter how pure their motives, there is an unplanned result.  This unplanned result, which may be instead of or in addition to the intended result, is almost always negative.

Enter the Cash for Clunkers program.  Your Uncle Sam is gravely concerned about your gas guzzling old automobile.  He wants you to buy a new, fuel efficient car.  Uncle Sam is so concerned that he’s willing to give you $4500 toward the purchase of a new car in exchange for your worthless old junker.

That’s good, right?  Good for you, good for the new car dealer.  Not so good for your uncle, but he’s got deep pockets so you don’t feel so bad.

What about the used car dealer across the street from the lot where you bought your new ride?  He doesn’t do very well on the deal, because his potential customers are sidling over to the new car emporium.  Uncle Sam’s intent was to help the new car dealer, but since there is only so much business to go around, his actions carried the unintended consequence of hurting the used car dealers.

Of course, your Uncle Sam really didn’t have the money to give you, so he took it from his investors, the tax payers of the United States.  We don’t have the money, either, but Sam didn’t ask our permission first.  He just took it.

Now Sam needs more money to pay the tab, and the dealers have gotten wise to his stalling tactics.  Some dealers sold cars weeks ago on the promise of some fat government money, but haven’t gotten paid yet.  The car dealers are getting tired of holding the bag, waiting for Uncle Sam to pay up.  Now they have begun holding on to the cars until they get paid for the government’s portion of the bill, causing backlogs of up to 100 cars that have been sold but not delivered on some lots.

I’m sure we’ve got nothing to worry about.  Sam’s always good for the money, right?

The twenty-five richest people in America have a minimum net worth of $12 billion each.  Bill Gates, Microsoft founder and all around uber-genius tops the list with $57 billion.  Warren Buffett comes in a relatively close second at $50 billion.  Then there follows a significant drop off both in terms of dollars and name recognition.

The money is staying in the family, with a number of second generation billionaires on the list.  Four of the top six are members of the Walton family (the Wal-Mart Waltons, that is).  The Koch brothers, of whom you’ve probably never heard, are tied for ninth place with $19 billion a piece.  Counted together, they’d be in third place.  The same could be said of the three Mars siblings (as in M&M Mars) and their $13 billion each.  You could go all the way down to the four MacMillian children who come in tied for 42nd place with a paltry $7 billion a piece.  Added together, they’d also come in behind only Gates and Buffett among individuals on the list.  Of course, if you counted all the Waltons together, they’d be first by a good amount.

You often hear people expressing a desire to become rich and famous.  Interestingly enough, many of the people on the list are not household names.  It may well be that the rich part holds more allure than the famous part.  For example, George Soros, the far-left hedge fund guru, is famous for supporting liberal causes with exorbitant amounts of money.  He’s tied for twenty-eighth on the list with Edward Johnson III.  Most people who are somewhat aware of the financial world are familiar with Soros, but what about Johnson?  Johnson is exactly as rich as Soros, but unless you did your term paper on Fidelity Mutual, you’ve probably never heard of him.

If you’re hoping to crack your way onto the list, learning to program a computer would be a good place to start.  Six of the top 15 earned their billions in computers – three from Microsoft, two from Google, and one from Oracle.  That’s the only advice I have.  After that, you’re on your own.

It’s bonus time again at AIG. America’s favorite charity, to which we gleefully contributed $180 billion, is set to hand out bonuses to 40 of their best go-getters. Unlike the gargantuan payouts of a few months ago, this is a paltry $2.4 million in bonus money.

It doesn’t seem like all that much, unless you consider that $2.4 million divided by just 40 employees means that these guys will be taking home a cool sixty grand a piece, on top of their regular salary. $60,000 is more than a lot of people make in a year. Let me take it one step further – $60,000 is more than a lot of hard working people who did NOT directly contribute to the collapse of the American economy make in a year.

What could these individuals have contributed that would justify such bonuses? These are deferred bonuses from 2008, meaning that these were ‘earned’ based on their performance as the company was falling billions of dollars into the red. Maybe these men and women are heroes in their own rights. Maybe AIG would have needed a $190 Billion or $200 Billion bailout if these bonus-worthy champions hadn’t done whatever it was that they did to prove themselves so valuable. But I don’t think so.

Continuing the proud tradition of making a bad thing worse by intervening in commerce, the federal government is now in the business of reviewing executive compensation. President Obama has appointed a Compensation Czar (no, I’m not making that up; that is a real position paid for by your tax dollars) to look into the salaries and bonuses earned by companies that are coming under the control of the United States government.

Of course, the Compensation Czar is powerless to do anything in this case because the bonuses were promised back in the carefree days before such a position even existed. The best we can hope for is another round of hand wringing and public vilification followed by complete and total inaction by the government. But the NEXT time a huge multination corporation fails and is bailed out by the government, just you watch.

The economy is… not good.  I know it; you know it.  If it weren’t evident by our personal and business bottom lines, you can’t help but be bombarded by stories on the news of businesses closing, banks foreclosing on homes, and people out of work.  Things are bad all over.

Well, maybe not everywhere, it turns out.  Hollywood, so disconnected from the real world of fly over country, seems to be doing just fine.  Movie theater attendance is on a record setting pace.  Consider how well Hollywood could be doing if they put out any decent movies this year (Star Trek excepted, of course).

The real issue of interest here is not that Hollywood doesn’t have to abide by the same rules as the rest of America.  That’s old news.  No, the real story is that Americans, so financially strapped that we’re putting the mid-level restaurants out of business and doing all our shopping at Wal-Mart, haven’t stopped going to the movies.  The message seems to be that we’ll sacrifice on the non-essentials, but don’t you dare take away my $8 tub of popcorn smothered in artificially butter flavored grease.  There are some things that we simply will not concede.

This got me thinking, so I did a little research on my own.  I visited about a dozen local businesses, from a citrus juicing plant to an auto dealer to concrete block makers to restaurants.   Time after time I listened to heart-wrenching stories of loss and layoffs and declining revenue and no hope on the horizon.

Thoroughly depressed, I then visited the local comic book store.  There, all is well.  No dip in revenue and a steady stream of customers.  I didn’t get to the video game store, but I suspect they would tell me a similar story.  In 21st century America, entertainment is king.

We’ll buy the cheap mac and cheese, we’ll put off replacing that worn out shirt, we’ll give up the Gatorade and drink water instead.  But we’ll keep our movies and comics and cable TV, thank you very much.

It is official.  Our unemployment rate has just risen to 7.2%.  524,000 jobs were cut in December alone.  The jobless rate is the highest it has been in sixteen years.  It seems as if everyone is getting laid off, and few are safe.  How can we overcome this and find a job?

Don’t panic.  I know this is easier said then done, but just sit on your hands for a minute and think through your actions rationally.  Don’t sell all of your belongings or organs just yet.  We normally have that “flinch” reaction when something bad happens.  Most of the time that reaction puts us in a worse position.

I have some free financial advice in the form of an ebook titled, Money for Tomorrow.  It was written to get us all back to the basics.  That must be step one.  We have to determine what we actually have and how much we need.  Once we figure that out, we know what we must look for in a job.

If we need $2,500 per month and as a gut reaction run out and start flipping burgers 50 hours a week, we still might not make it.  It would be smarter to work less hours and search for a better paying job.  My brother was just laid off and after sitting on his hands for a moment realized that he is in ok shape for a little while.

He saw that with unemployment, savings and not sending the kids to daycare they can hold down the fort.  Instead of wasting his time doing odds and ends for long hours, he is solely focused on finding a job.  I am very proud of how he is handling the whole situation.

In conjunction with that, a good friend of mine, JB Bryant, wrote a great article on job hunting.  He, too, has been a victim of the recession and has done extensive research on this topic and organized it for all to see.

Do any of you have great advice or tips to share with us?  Tough times are easier to get through as a unified team.

Every time I check the news, I get bombarded with analysts that are terrified about the economy.  There are one thousand Chicken Littles running around sparking fear.  Let’s get them back into the hen house.

For starters, no one is certain about what will happen to the economy, and that is scary. Change and the unknown are very scary, and that is why suspense movies make you jump out of your seat. Currently, we are in one of these movies without a script.

Why should we not be afraid? The economy moves in natural cycles. The “Roaring Twenties” was capitalizing on the stock market. People were making fortunes off of their portfolios. Then the market crashed, and all those that were over-leveraged were left with nothing. The ripple effect carried throughout the masses, and the panic further hurt those doing well and businesses collapsed. This in turn resulted in lost jobs and ultimately the Great Depression.

Then the US auto and steel industry was insanely powerful. Millions of jobs and vast economic booms were experienced. Foreign competitors kicked our complacent butts and that industry collapsed again crushing the populace. Now there is something similar happening with oil prices and the housing industry which were booming in the recent past.

Again we got over-leveraged. Greedy companies were passing out credit as if it were in the “take-a-penny” tray. We were greedy and took the credit and bought useless things that we could not afford. Mortgage companies gave us loans that forced us way out of our means. The companies experienced a boom in sales. The GDP was up and everyone was officially winning.

Until…the rise in oil prices. Now, our paycheck to paycheck strategy was collapsing. The banks started suffering and wanted their money to pay for their expenses. Interest rates were raised on the adjustable rate loans, and people began losing their homes.  They got over-leveraged.

Why shouldn’t we be afraid? Every single financial crisis in our history has been overcome, and each time we have come back even stronger.

What are you doing to protect your fiancial futures? What advice can you give our readers?

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