Warren Buffett Owns Up To Mistakes - Business Tips from Warren Buffett

What makes a man an even bigger man? A man who is accountable. Warren Buffett is that kind of a man. No wonder he's the world's most widely followed investor.

Being the respectable businessman that he is, Warren Buffett had this to say in his annual letter to shareholders of Berkshire Hathaway Inc., Warren Buffett's insurance and investment company

"During 2008 I did some dumb things in investments," he wrote, adding later, "I made some errors of omission, sucking my thumb when new facts came in that should have caused me to re-examine my thinking and promptly take action."

"The economy will be in shambles throughout 2009 -- and, for that matter, probably well beyond -- but that conclusion does not tell us whether the stock market will rise or fall."

"Though the path has not been smooth, our economic system has worked extraordinarily well over time," he said. "It has unleashed human potential as no other system has, and it will continue to do so. America's best days lie ahead.

Berkshire Hathaway went down by a significant percentage, overall the company ended the year with $25.54 billion of cash, down from $44.33 billion a year earlier. It said it made roughly $6 billion of acquisitions in 2008, and spent $14.5 billion on fixed-income securities from General Electric Co, Goldman Sachs Group Inc and chewing gum maker Wm Wrigley Jr Co. Buffett sold some stocks to fund the latter purchases.

For all of 2008, profit at Berkshire fell 62 percent to a six-year low of $4.99 billion, or $3,224 per share, from $13.21 billion, or $8,548. Revenue fell 9 percent to $107.8 billion.

Wow even the world's most-admired investors, and Forbes magazine's second-richest American had a bad year in 2008

Some tips, which indexes does Warren Buffett use?

• Standard & Poor's 500
• Britain's FTSE 100
• Europe's Euro Stoxx 50
• Nikkei 225 in Japan

Predictions on How the Philippine Economy will Suffer along with the rest of the World

It's a good thing the Philippines wasn't so advanced in the first place in terms of investment because if we had been, then the Philippines would also be in a pretty bad shape now.

The only reason the Philippine economy is still afloat is because the Philippines was too poor to invest its finances in the riskier financial institutions. Unfortunately the smarter more advanced economies thought that taking smaller more secure investments and reinvesting them into riskier investments made them a lot more money. Unfortunately, that didn't work out the way they planned it.

The Philippines will feel the ripple effect of the US economic slowdown. The impact will be felt first of course in the stock market as well as direct exposure. The latter is minimal while the stock market will hurt PSE among other things. And then in terms of incoming investments. The export industry will suffer - particularly those that service the US and Europe. Yes Europe is also in trouble as a result of the sub prime catastrophe. Iceland has already declared bankruptcy and I'm pretty sure that country was much better off than the Philippines. Both the US and the UK have put in place bailouts as sponsored by their governments. Let's hope they make it through this as well. Because we are all interconnected financially, the Philippines owing money to other countries, make it susceptible to these changes although not on our shores.

Nevertheless the living conditions won't be as bad as it has always been - prices will continue to be high, gasoline prices have at least has gone down because there is less demand for oil now as a result. Business that are dependent on tourism and incoming remuneration from abroad will be hit specifically.

If OFWs abroad will have a difficult time, the Philippine economy will be hit pretty bad although I doubt the the extent to which overseas Filipino income will be threatened any worse than an American or European.

The newspapers these days are just peppered with images of the stock market and how it has just crashed amidst the US economic trouble. The bail-out will take a few months or even years to take effect - as the primary issues now are that people are no longer comfortable with spending money, banks are no longer free to give as much credit as they used to. There is a lack of predictability as to what might happen to the stock market, everything being red now.

Some people are buying stocks while their dirt cheap while most are just unloading what seems like lost causes.

The world will be a lot wiser after this economic slum... if it will survive it