Chin Up in the Downswing: Retail, Buffett and Virtual Startups Cash In
by Anne Szustek
U.S. retail sector's February figures outpaced analysts’ expectations, Buffett sees potential for domestic investment and a former venture capitalist sees flush funding for new “virtual world” sites.
According to figures provided by the Department of Commerce, U.S. retail sales declined 0.1 percent in February. It suggests the retail sector is more resilient than economists had thought; sales were projected to contract by 0.4 percent last month. Gas stations led the way with 3.4 percent higher sales last month. Among the other segments showing upticks in February retail sales were clothing stores, with 2.8 percent; electronic stores with 1.2 percent and general merchandise stores, up 1.3 percent.
Famed investor Warren Buffett said in an interview airing Thursday and Friday on Bloomberg Television that due to generally lower prices and less competition, “there’s a lot of things that may be happening in the United States” with respect to acquisitions by his conglomerate Berkshire Hathaway. This marks a potential turnaround from last year, when he went on a tour of Europe to scout out potential takeover targets because there were few buying opportunities stateside. Buffett also mentioned that auto insurer and Berkshire subsidiary Geico has been having record sales from customers transferring plans to save money.
Startup Web sites devoted to virtual worlds, virtual currency and virtual goods have been getting a lot of attention—and cash—from venture capitalists recently. Tech writer Om Malik, a former venture capitalist himself, mentions three companies that have received multimillion-dollar investments in the past month: games advertising network Greystripe ($5.5 million), online social gaming firm SuperSecret ($10 million) and virtual currency startup Offerpal ($15 million).