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"It was a holiday present to Corporate America." — Ann Yerger, executive director of the Council of Institutional Investors, on a new SEC rule altering stock-option award disclosures, allowing many companies to report significantly lower total compensation for top executives, as reported by The New York Times

Can the wisdom of crowds trump the power of Google (GOOG)? Jimmy Wales, the man behind Wikipedia, thinks so. Wales plans to launch Wikiasari, a search engine, in early 2007. Like his Web encyclopedia, one of the top 15 online destinations worldwide, Wales's engine will rely on input from a volunteer community—this time to re-rank search results and (if users have the programming chops) to tweak Wikiasari's open-source search codes for better results. Used alone, Wales argues, mathematical search formulas like Google's do not produce consistently relevant results. "Human intelligence is still a very important part of the process," he says.

Unlike Wikipedia, Wikiasari will be for-profit, funded by Wales's Wikia Inc. and (AMZN), plus $4 million from Bessemer Venture Partners, an original Skype investor, and Omidyar Network (owned by Pierre Omidyar, founder of eBay (EBAY)). Wales, who believes potential contributors won't balk at helping out an ad-sponsored, profit-making search wiki, figures it will take three years of user input before Wikiasari can rival the top engines. "I wish I could write a Google-killing project in three months," he says, "but it is going to take a little bit longer."

Raids by the feds at six Swift & Co. plants on Dec. 19 made headlines. But they're just part of the story for companies caught in the crossfire of the immigration debate, who also face attacks from competitors and employees.

In California, a Bakersfield court is slated to hold a January hearing on a suit filed by labor contractor Global Horizons alleging that some rivals use illegal workers, putting it at a competitive disadvantage. The suit, filed under state antitrust law, seeks more than $1.6 million in damages. "We want to get a judge's opinion about the legal validity of it before we file more," says David Klehm, attorney for Global Horizons. Also waiting to be heard, in federal courts: cases filed under anti-racketeering laws by workers at Tyson Foods and Mohawk Industries who claim managers conspired to hire undocumented workers to depress wages. Both companies deny the allegations.

Meanwhile, the Immigration Reform Law Institute, part of immigration-control group FAIR, is gearing up to target banks and mortgage lenders serving illegals. As the immigration debate rages, says Angelo Amador of the U.S. Chamber of Commerce, Congress "should indemnify" businesses that conduct good-faith id checks. "We need predictability and some finality," he says.

Karl Rove, Howard Stern, and eBay's (EBAY) Meg Whitman weren't just a little off about 2006. They were flat-out wrong. So were some housing analysts and government meteorologists. Now that the season for good will has passed, let's gloat over some of the forecasts that fizzled.

PREDICTION: "We are on a tear to be the undisputed winner in China." — eBay CEO Meg Whitman, Feb. 10, 2005

THE REALITY: In December, 2006, eBay said it would close its eBay operation in China and become instead the junior partner in a new Chinese e-commerce venture.

PREDICTION: Satellite radio will succeed.... Trust me. With me, it's a lock." — Howard Stern, Dec. 22, 2005

THE REALITY: The stock of Sirius Satellite Radio (SIRI), Stern's new employer, is down more than 40% since he began broadcasting. In the first nine months of 2006, Sirius lost nearly $900 million.

PREDICTION: Patricia Dunn is the "clean-up queen of corporate governance." — Headline in The Age, Melbourne, Australia, Apr. 4, 2006

THE REALITY: On Oct. 5, Dunn, Hewlett-Packard' (HPQ)s former board chairman, was booked in California's Santa Clara County Superior Court following felony charges arising from HP's alleged spying tactics in its investigation of boardroom leaks.

PREDICTION: "A very active hurricane season is looming." — National Oceanic & Atmospheric Administration, May 22, 2006

THE REALITY: Of the up to six "major" hurricanes in the North Atlantic that were predicted by NOAA, only two materialized. Number that reached U.S. shores: zero.

PREDICTION: "It's very clear to us that oil prices have peaked for this cycle." — Bill Miller of Legg Mason (LM), Dec. 8, 2005

THE REALITY: Miller, the firm's leading investor, said oil prices would reach $40 to $55 a barrel during the year. Instead, they hit $78 in 2006.

PREDICTION: The national median home price will rise about 6.1% in 2006. Over a full year, it "has never declined since good record-keeping began in 1968." — National Association of Realtors, Dec. 12, 2005

THE REALITY: Through October, the median price of residential properties was down 3.5% from a year earlier.

PREDICTION: "It's the definitive last chapter in the trial of the century." — Fox Broadcasting (NWS) Executive Vice-President Mike Darnell, on O.J. Simpson's book, If I Did It, Nov. 13, 2006

THE REALITY: It wasn't the last chapter; it was the last straw. After a public uproar, News Corp. (NWS)Chief Executive Rupert Murdoch killed the book and fired its editor, Judith Regan.

PREDICTION: "Earnings disappointments will likely cause a more significant correction in equities at some point in 2006 than we have experienced in some time." — Robert Doll, chief investment officer of Merrill Lynch (MER) Investment Managers, Jan. 10, 2006

THE REALITY: Corporate earnings reached their biggest share of gross domestic product since 1950, the market never "corrected," and through Dec. 20, 2006, the S&P 500-stock index was up 14%.

PREDICTION: "There's just not that many videos I want to watch." — Steve Chen, co-founder of YouTube, worrying in March, 2005, about his startup's potential popularity

THE REALITY: As Chen was expressing all this anxiety, YouTube had roughly 50 videos available. Today more than 100 million are viewed daily on YouTube, which was acquired by Google (GOOG) on Nov. 14 for $1.65 billion.

PREDICTION: "I'm looking at all of these [polls]...and adding them up. I add up to a Republican Senate and a Republican House. You may end up with a different math, but you are entitled to your math, and I'm entitled to THE math." — Presidential adviser Karl Rove, Oct. 24, 2006

THE REALITY...was rather different.

Wal-Mart's dreamed-of merger with Habitat for Humanity International may finally happen in 2007. And why not? It's an exchange of pluses analysts say can't miss: The big-box retailer, down in the image dumps, gets to bask in Habitat's goody-two-shoes rep—and take on an all-volunteer workforce to build its new megastores. Access to Wal-Mart's competitive culture, meanwhile, should help nonprofit Habitat hold on to its share of the cutthroat market in building homes for the poor free of charge.

Overseas: Now that the last of its dissident shareholders have vanished, Russia's oil-weapons-vodka cartel, MUZGOP, LOOKS LIKELY TO spin off its chronically underperforming Government unit. Among the rumored buyers: Hot leveraged-buyout firm DZERZH, made up of former KGB officers.

2007 should also be the year MegaMicro finally starts to ship its LifePod 4G, designed to pack your entire existence into a slickly styled, thimble-size gizmo that lets you replay, over and over, every moment you've lived, from first kiss to your niece's bat mitzvah and that last visit to the dentist. Let's hope that what kept the 4G in beta for all these years—the pesky electronic glitch that short-circuited the system and erased 15 focus-group participants in 2003—has been licked.

U.S. Industry is a cinch to go big-time for SludgeCo's new line of enviro-friendly pollutants, due out on Earth Day. Already generating lots of excitement: river contaminants that poison water rats while actually strengthening the delicate vascular system of the snail darter.

Airlines will once again take the lead in cost-cutting ingenuity. CrisisAir's bold bring-your-own-seat program starts in February. And to save on fuel costs, Air Chapter Eleven will inaugurate "tow trips"—lead passenger jets pulling two or three other planes across the skylanes. Over at Trans Insolvent, meanwhile, they're dispensing with their fleet altogether. Starting in '07, TRANSIN will rent small private planes on the spot at its hubs and divvy up the passenger load, taking air travel back to the romantic barnstorming era.

Finally, expect more companies to hop on the back-to-basics brand-name bandwagon. EmGarCo will revert to Emmett Garver Stationers come January. Maxicia will hang out its old Jones Bros. Home & General Insurance shingle. And Neoxibat? It will once more be simple-as-pie Nelson Oxide Battery Corp.

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