Google reported earnings and sales for the fourth quarter that missed Wall Street estimates, sending the stock falling after hours.  Shares of the leading Internet search company, which has typically blown away analysts’ forecasts, plunged nearly 9% after the closing bell. The stock had risen about 3% in regular trading Thursday. Google’s stock has taken a hit in recent weeks, dipping nearly 25% below its all-time high of $747 last November.

Google reported that its fourth-quarter revenue came in at $4.83 billion, up 51% from a year ago. Excluding advertising sales that Google (GOOG, Fortune 500) shares with partners (also known as traffic acquisition costs or TAC), the company reported revenue of $3.39 billion, below the $3.45 billion analysts had expected, according to Thomson Financial.

Google posted net income of $1.44 billion, or $3.79 a share, up 17% percent from a year ago. Profits, after backing out certain gains and charges, came in at $4.43 per share, narrowly missing Wall Street’s expectations of $4.44 a share.  Many are calling Google recesion proof but I am not quite convinced of that.

School districts, counties and cities across Florida are seekingt to raise cash after being denied access to their deposits in a $14 billion state-run investment fund.  The Jefferson County school district was forced to take out a short-term loan to cover the payroll for the 220 teachers and other employees in the system after $2.7 million it held in the pool was frozen yesterday. At least five other districts also obtained last-minute loans, said Wayne Blanton, executive director of the Florida School Boards Association.

Florida’s State Board of Administration, manager of the Local Government Investment Pool, halted withdrawals yesterday at an emergency meeting after $13 billion was pulled out this month from participants. Governments from Orange County, home of Disney World, to Pompano Beach asked for their money back following disclosures that the fund held $1.5 billion of downgraded and defaulted debt.

An advisory panel of school and local government officials with money in the frozen investment pool told the fund’s management late today, following a more than two-hour conference call, that they won’t accept a return of less than 100 percent of their investment.  The board said $1 billion was withdrawn from the pool just before the freeze, reducing the fund’s size to $14 billion, a 48 percent decline for the month. Yesterday, state officials said the pool held $15 billion.

By freezing the Florida fund, officials left governments without ready access to cash they are accustomed to drawing upon for routine expenditures. The pool was the largest of its kind in the U.S. at $27 billion before the unprecedented withdrawals.  Wilson at Jefferson County said he plans to withdraw the school district’s money from the pool as soon as he can, and won’t consider investing there again.

A federal appeals court upheld the conviction of former Cendant Corp. Chairman Walter Forbes Monday for leading the largest accounting fraud of the 1990s.

The 2nd U.S. Circuit Court of Appeals in New York upheld Forbes’ conviction on conspiracy to commit securities fraud and two counts of making false statements. Forbes was sentenced to 12 years and seven months in prison and ordered to pay more than $3 billion in restitution.

Forbes was involved in a fraud that inflated revenue by more than $500 million at Cendant’s predecessor, Stamford-based CUC International, to drive up the stock price. The fraud was reported in 1998, causing Cendant’s market value to drop by $14 billion in one day.  The fraud cost the company and 119,000 investors more than $3 billion.

The appeals court concluded that prosecutors’ use of the term “$14 billion fraud” in their opening statement was not misleading and prejudicial. They also said the District Court correctly ruled that references to the company’s decline in stock price and investor losses were permissible.  Last year, Cendant stockholders changed the company’s name to Avis Budget Group (Charts, Fortune 500) to reflect its Avis and Budget vehicle rental brands.  It is well known that he attempted to use offshore banking to hide assets.

The Cendant case was among the first in a series of corporate accounting scandals that sparked outrage from investors in recent years.  The case was tried after two previous juries deadlocked.  Forbes, who testified during the trial, has argued he knew nothing about the fraud. His co-defendant, former Cendant Vice Chairman E. Kirk Shelton, was convicted in 2005 of conspiracy, mail fraud, wire fraud, securities fraud and making false statements to the SEC.  Shelton was sentenced to 10 years in prison and ordered to pay $3.27 billion restitution to the company.

Forbes was chief executive officer of CUC and Shelton was president before the membership marketing operation merged with the travel and real-estate services company HFS Inc. to form New York-based Cendant in December 1997.  Not very suprised at this outcome as the guy is a dirty as a pig rolling in it’s own shit.

Wall Street investors left for Labor Day weekend pleased about the prospects of an interest rate cut, but they’re likely to come back wanting more evidence that rates are indeed about to come down.  Expect to see some termpered buying on Tuesday morning.

The market has been in better spirits, for the most part, over the past two weeks than in midsummer, when fears that lending troubles would freeze up credit sent stocks tumbling. Although the Fed has injected cash into the banking system and lowered the discount rate - the rate it charges commercial banks for loans - Wall Street’s fears haven’t been completely assuaged.  The Dow Jones industrials and Standard & Poor’s 500 finished slightly lower in a week where it plunged and later recovered. The Nasdaq finished the week higher.

Fed Chairman Ben Bernanke has not come right out and declared that a rate cut will happen, but many investors believe he has telegraphed it by saying the central bank will “act as needed.” Traders who bet on the Fed’s next move are not only pricing in a 100 percent chance of a quarter-point rate cut at its next meeting on Sept. 18, but also are pricing in a 100 percent chance of similar move in October.

The Fed has not reduced the benchmark fed funds rate since 2003, when it declined from a low 1.25 percent to 1 percent. Starting in 2004, the central bank made gradual rate increases until the summer of 2006, when it began holding the benchmark rate at 5.25 percent - the highest it’s been since early 2001, but historically, fairly moderate.  Investors will be curious to see if the Bank of England and European Central Bank decide to lower rates Thursday. Rate cuts abroad could signal a similar move from the Fed.

Investors also want to know if the U.S. job market, which has been one of the more stable parts of the economy, is holding up. The Labor Department’s report comes out Friday. Economists surveyed by Thomson Financial predict that nonfarm payrolls rose in August, that the unemployment rate held steady at 4.6 percent, and that hourly earnings ticked up by 0.3 percent.