The latest edition of the Google phone, or gPhone or GPhone, chatter contends the search advertising company has a mobile operating system ready to launch.

Engadget editor Ryan Block followed up on Wednesday’s iPhone mix up with a long apology and explanation of how the popular tech blog received bogus information and why it was posted.

Well, we can officially put the debate to rest that blogs don’t count for much (not that anybody has really debated the blog’s potential lately). When Engadget reports bad news, stocks plummet – a lesson Apple learned the hard way as $4 billion in market cap fell off the board for six Wall Street minutes.

A supposedly false-alarm that Apple’s Leopard (their next OS) and their much-talked-gadget-phone iPhone being delayed, caused their stock to nose-dive knocking over $4 billion off their Market Cap. This is indeed a phenomenal development in the Blogosphere – a blog article can have that fundamental effect in the real work and real money.

Engadget ended up with egg on its face after a phony email purportedly from Apple led them to believe the iPhone and OSX Leopard would be delayed.

Google is working on a mobile phone, a Google executive confirmed, but you may not see it in the States.

It would, after all, steal some Apple thunder, and Schmidt and Jobs are billionaire buddies.

Engadget reports that Isabel Aguilera, a Googler heading up things on the Iberian Peninsula, said there is a Google phone being developed, but are intended for the the markets in developing nations.

Rumors have been mounting over the past two months surrounding the existence of the fabled Google phone, a device that the mobile community has anticipated with baited breath for some time now. As more details come to light concerning the alleged Google phone, one wonders if Apple views the device as a legitimate competitor to the iPhone.

The folks over at Knuttz.net have cracked the code on Digg. So listen up, I’m here to explain to you exactly how they do it (well, with one critical missing detail!)