The 5 Items That Will Get Cheaper in 2012

Source : TIME :DAN KADLEC| January 4, 2012 |

What will 2012 bring? Economic recovery or a double dip? A new President or … a double dip? Another tsunami? Revolt in Europe? No one can say with certainty. But here are 10 trends that consumers can take to the bank.

According to the shopping website dealnews, these five items will get cheaper this year:

• Wine Bottles priced at $30 or more are languishing on store shelves. To move stock, retailers will offer discounts.
• Car rentals Agencies have a glut of vehicles sitting idle on the lot. They will offer discounts to get those cars on the road.
• iPad 2 Technology always gets cheaper. This year many computer-related items like perfectly usable eBook readers and tablets will come down in price ahead of the iPad 3 release.
• 3-D TVs This relatively new technology will hit critical mass this year, and with many new designs and makers in the game, prices will fall to an irresistible level.
• Homes Home prices fell about 3% last year and should fall that much again this year. But the smart money is getting ready for a rebound after that, expecting prices to rise by 30% over the following 10 years.

Here are 5 items that will get more expensive, according to dealnews:

• Airfare Fewer flights will lead to higher ticket prices. American Express predicts prices in North America will rise 5% for economy seats and 7% for business class.
• Food Wholesale food prices are rising, and the costs are being passed along to consumers. Food costs rose 6% last year and will rise again in 2012. These increases will be felt most at home, not in restaurants, where the costs are easier to absorb.
• Gas
 Fuel prices began inching up just before the holidays and are expected to again reach $4 a gallon at the pump.
• Shipping 
The U.S. Postal Service will raise rates by 4.6% next year while both FedEx and UPS are hiking small-package rates by 4.9%. It may be the end of common free-shipping features for online shoppers.
• Municipal fees
 To make up for budget shortfalls, local authorities will jack up the levy for everything from dog licenses to vehicle registration and parking. Look for local cops to write more tickets too.

The Man Who Lost $2 Billion in 2011

Source : SiliconIndia, Thursday, 05 January 2012, 01:27 Hrs 

 Warren Buffet lost about $2 billion in 2011, as reported by Andrew Frye of Bloomberg. The fall in Buffet’s stocks was recorded by Standard & Poor’s (S&P) 500 Index.  

Though Buffet, Chairman and CEO of Berkshire Hathaway, claims to be at the top of the stock market, even during harsh times, last year saw a dip in his stocks. The loss of about $2 billion was mostly due to Berkshire’s fall of 4.7 percent, in stocks, last year. The fall in Berkshire’s stocks last year comes as a surprise as this company has exhibited an increase of 17 times its value since its inception and an increase of 4 times in its index. David Rolfe, Chief Investment Officer (Berkshire Investor Wedgewood Partners), said that Berkshire is a “strong performer” in “tough markets.”

Buffet held the first share-repurchase programme in the last 40 years. Also, the stock prices of Berkshire fell at an all-time low in the 3^rd quarter last year. Berkshire also underwent insurance claims in connection with natural calamities and derivatives affecting institutional portfolios. David Sokol, former Chairman, President and CEO of NetJets, closely associated with Berkshire, and his resignation from his company, due to allegations of insider trading, further affected the stocks of Berkshire. Berkshire also owns the largest percentage of share in Wells Fargo & Co. (WFC), a bank head-quartered in San Francisco. WFC’s value dropped by 22 percent last year, thus, sinking $2 billion of Berkshire.

The main reason behind the declining stocks of Berkshire is ‘insurance losses’. Charles Munger, Vice Chairman (Berkshire) said that the insurance losses of Berkshire were mainly due to the earthquake and tsunami in Japan in the earlier part of 2011. According to Financial Report, there was a 58 percent drop in the profits of Berkshire in the 1^st quarter of 2011, when compared to that of 2010, due to the natural calamities in Japan. This was due to massive losses in the forex trading of Berkshire. The insurance losses went as high as $1.7 billion dollars due to tsunami and earthquake in Japan, floods in Australia and earthquake in New Zealand.

Despite the losses, Berkshire registered a net profit of $131 million last year. This number, however, is very small when compared to the net profit of $1.2 billion in 2010. According to data collated by Bloomberg, Berkshire’s Price-to-book-ratio on 31^st December, 2011 was around 1.2, which is greater than that of 1.1 in 2010. Also, the Book Value of Berkshire increased by 1.7 percent amounting to $160 billion in the 3^rd quarter of 2010.