1. Improved U.S. economy: Unemployment is down to 8.3%, and the U.S. economy is showing a little spring in its step. No full-blown recovery, but when things are looking up, people start to spend -- including on travel. Several surveys show 2012 is primed for increased traveling, and when more planes, trains and automobiles get running, you get higher demand for gas.

2. Global Demand: Of course, while we're piddling around at home, parts of the rest of the world are really growing. China's overall fuel imports for 2011 were up "only" 6% from 2010 after the previous year's 17.5% growth. Goldman Sachs (GS) expects China to overtake the U.S. as the No. 1 oil importer by 2013, and India, already among the world's top five oil importers, is only getting bigger.

3. Seasonality: Think summer's the worst for gas prices? Wrong -- at least sometimes. While summer traditionally sees the highest gas prices, fuel also has spiked around late April/early May, including during the past two years. Some of the price run-up comes from annual refinery maintenance. According to AAA spokeswoman Jessica Brady (via the Atlanta Journal-Constitution), refineries across the country begin shutting down in February and March to switch production from a winter fuel blend to the pricier summer fuel blend, which also puts upward pressure on gas prices.

4. Tensions with Iran: It's still a big "if," but the standoff between Iran and the U.S. and Europe over Iran's attempts to produce nuclear weapons could become one of the single-greatest upward forces on gas prices. Iran has responded to sanctions against its oil exports by threatening to close the Strait of Hormuz - a narrow waterway through which 20% of all globally traded oil is transported. Iran recently conducted military exercises near the strait, and Britain has said it could send extra military forces to the area to deter a blockage.

But should the strait be closed for business, you'll know about it within an hour, according to Duquesne University professor Kent Moors. In an interview with Marketplace.org, Moors said crude oil prices would jump $10 to $15 per barrel -- and gas prices jump between 30 cents and 40 cents per gallon -- "almost immediately."

5. Oil Takes More Work: There's a reason the word "fracking" has quickly entered the vernacular. Oil players of various sizes -- from Exxon Mobil (XOM) to Kodiak Oil & Gas (KOG) -- are tapping into North Dakota's Bakken Shale through the costly process of hydraulic fracturing, and while fracking costs are on the downswing, it's still a more expensive process than traditional drilling.

Oil companies also are accelerating their efforts in tar sands and deepwater drilling -- also pricey endeavors. And until these methods become more economical, energy companies need high oil prices to help finance production. Add it all up, and the chances for sub-$4 gasoline after Memorial Day seem mighty slim.

Kyle Woodley is the assistant editor of InvestorPlace.com. As of this writing, he did not hold a position in any of the aforementioned securities.

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Kyle Woodley is the assistant editor of InvestorPlace.com. As of this writing, he did not hold a position in any of the aforementioned securities.

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The holiday quarter wasn't everything it could have been for the consumer electronics industry. Apple (NASDAQ:AAPL) sold a lot of iPhones and Amazon (NASDAQ:AMZN) sold plenty of Kindle Fires, but even those popular gadgets didn't prevent overall electronics sales falling to $9.5 billion, 5.9% year-on-year. It was all a mixed bag. Smartphones and tablets did big business, according to industry tracker NPD, but low sales of once-popular items like DVDs and camcorders dragged down the industry.

No segment of the electronics industry better highlights the challenges of these middling times than televisions. On the one hand, sales revenue from big-screen TVs (50-inches and bigger) grew 32% year-on-year this holiday. Cheaper sets with 32-inch screens, traditionally the best-selling range of TVs, saw revenue drop 9%. 3DTVs, the struggling models pumped out by flagging industry giants like Sony (NYSE:SNE), saw sales jump 100%, accounting for $1 in every $5 made on televisions this holiday. With more and more models from Korean manufacturers like Samsung (PINK:SSNLF) including 3D as a basic function, though, the boost may not reflect any broad change in consumer tastes. Overall, television sales fell 4%.

One step forward, another step back

This is precisely the dilemma that forced the aforementioned Sony and competitor Panasonic (NYSE:PC) to announce in November the downscaling of television production. Sony halved its LCD TV sales projections, from 40 million per year to 20 million. Panasonic decided to cut its TV screen production to just 7.2 million per year, a restructuring move that will ultimately cost the company around $3.45 billion. Korean manufacturers like LG and Samsung are faring better in the market, but as demonstrated by holiday sales, there's simply less money to be made from televisions across the board.

What's the way forward?

How will the television market actually start growing again? Consider this statistic from the NPD Group's report on holiday electronics sales: Standalone streaming devices, meaning set-top boxes like those made by Roku, Apple, Logitech (NASDAQ:LOGI) and others, saw revenue from sales grow 65% over the holiday. These devices, which give access to Internet-based television options like Netflix (NASDAQ:NFLX), tend to be cheap, between $50 and $300, so troubled TV manufacturers won't exactly find safe haven in making new standalone streaming devices. What that boost demonstrates, though, is a willingness by consumers to spend on streaming products.

The industry responds

It looks like the television industry is already paying attention, considering what's on display at this year's Consumer Electronics Show. Google (NASDAQ:GOOG) is pushing its revamped Google TV platform hard, growing its stable of device partners from two to six. Samsung, Vizio, and Sony are all showing off new television sets with Google TV streaming services built in. In fact, all of Sony's new Bravia television models (relatively few compared to past years) emphasize access to streaming services - not just Google TV but the company's own Sony Entertainment Network media stores. Samsung is pushing its line of ES8000 Smart TVs, with streaming content and game apps like Rovio's Angry Birds. Sharp (PINK:SHCAY), meanwhile, announced 20 new HDTVs at CES on Monday, all of which feature built in WiFi and SmartCentral streaming services.

Consumers didn't spend more on TVs during the 2011 holiday season, but they spent significantly more on streaming devices. The industry is banking heavily on consumers spending more on TVs when those streaming devices are built right in. Time will tell if that means new growth opportunities for longtime players in the market.

Of course, there will be new players as well. And time will tell if Samsung, Sony, and all the rest can compete with Apple when it delivers its Apple HDTV later this year.

As of this writing, Anthony John Agnello did not own a position in any of the stocks named here. Follow him on Twitter at @ajohnagnello and become a fan of InvestorPlace on Facebook.

Atlanta's Bank of America Plaza is one of the 10 tallest structures in the U.S. And thanks to troubles at its namesake Bank of America Corp. (BAC) and other one-time tenants, the skyscraper could be one of the tallest foreclosure tales of the financial crisis as it struggles to meet its debt service and offices remain empty.

The Altanta Journal Constitution newspaper writes that, "a company that specializes in troubled loans is making preparations for a possible foreclosure [of Bank of America Plaza] while negotiations continue on a deal to try to prevent the property from being seized by the lender, according to a report by Trepp, a real estate research firm."

To be clear, the tower is owned by California-based commercial real estate firm BentleyForbes -- not Bank of America. BentleyForbes bought the 55-story tower at the height of the nationwide real estate boom under the premise that it could get big rents for tenants clamoring for office space.

Obviously, things have changed.

The $363 million loan on Bank of America plaza went to LNR Partners in February, while a second loan had been in default for non-payment.

Obviously Bank of America isn't the one holding the bag on this property, but it's hard to ignore the direct relationship between the boom and bust or real estate and the boom and bust of U.S. financial institutions over the last decade.


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Apple investors should be some of the happiest shareholders on Wall Street. And for the most part, they are. But when it comes to the question of dividends, the gratitude vanishes.

Year after year, Apple (AAPL) investors ask about a dividend. Year after year, Apple declines to offer one, rewarding shareholders instead with handsome returns in its stock value. Apple returned investors more than 25% in 2011, a year when the rest of the market basically flat-lined.

Now, investors and analysts have gone from asking about a dividend to predicting that Apple will pay one in 2012. An analyst from ISI Group went on CNBC to declare that an Apple dividend "is going to happen." Earlier, a fund manager at Gamco Investors made a similar claim. Even IAC's (IACI) Barry Diller disparaged the concept of growth companies not having to pay dividends as "outdated and somewhat inane."

Never mind that Apple last paid out a dividend 17 years ago, when Michael Spindler was CEO. Or that Steve Jobs -- who made tens of millions of dollars a year from Disney (DIS) dividends -- never felt a need for one, preferring to have large piles of cash as a safeguard that allowed Apple to take risks.

Now that Jobs is no longer involved, investors are cranking up their expectations that a dividend to come. After all, Apple's cash pile keeps growing - from $40 billion a year ago to $80 billion today. And analysts figure free cash flow will keep adding $40 billion a year for the next couple of years. And besides, Apple's stock, valued at a moderate 15 times earnings, could get a boost by the increased demand that a dividend would create in the stock.

Apple's new CEO Tim Cook is clearly facing pressure to pay a dividend. He mentioned in a recent conference call with analysts that he's "not religious" about holding or not holding cash. Some read into his words a softer stance on the dividend issue, but the language is as vague and noncommittal as Jobs's old comments on Apple's cash.

In time, Apple may capitulate to investor demands, but that time isn't likely to come in 2012. Here are some reasons why.

In Silicon Valley, dividends are a sign you're over the hill. They're what you pay to mollify investors who want to know why growth is slowing. But Apple's revenue is expected to rise 29% this year with earnings increasing by 25%. Microsoft (MSFT) pays dividends. Google (GOOG) doesn't. And Apple doesn't want to be seen as losing face before its rivals.

Apple is also seen in the tech industry as the world's largest startup. True, this "startup" has a $388 billion market cap, but Apple is regarded as the prime example of a tech giant that can still innovate like a scrappy newcomer. Startups view cash the way Jobs did - as a cushion to protect you when risks don't pay off. Handing it to investors signals to software developers everywhere that you're losing your edge.

In fact, for all of Silicon Valley's materialism, it also has a strong current of idealism that Apple embodied under Jobs. Cook's Apple is keen on preserving the ideals of its longtime CEO, so a dividend so soon after Jobs's death would look like a step away from those ideals.

In addition, most of Apple's cash is overseas. Like Google and Cisco (CSCO), Apple invests much of its profits in countries with lower tax rates. To pay a dividend, Apple would need to repatriate cash and also pay a U.S. corporate tax rate closer to 35%. If the U.S. grants a tax holiday, Apple may give in and pay a dividend. But a tax holiday looks unlikely in 2012.

The calls for an Apple dividend aren't likely to go away, and in fact will increase as the company's cash pile grows. But the simple reality is that tech investors need an Apple dividend much more than Apple needs to pay one. The kind of reliable growth that Apple delivers regularly is hard to come by, even in the tech sector.

Few investors are foolish enough to punish Apple by selling their shares. And that leaves complaining as their only option.


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If your New Year's resolution was to pinch a few more pennies, Starbucks (SBUX) has some bad news for you. The coffee king is raising prices thanks to rising costs of coffee and milk, passing its expenses on to java junkies.

More disturbing, however, isn't the price hike at Starbucks - but the unfortunate reality that nearly all of your favorite restaurants will be charging you more in 2012 than they did last year.

Here are the specifics on Starbucks: The company is raising prices about 1%, on average, in some of its most popular markets in the Northeast and Southwest. Cities such as New York, Dallas, Atlanta and others are the big targets. As one example, a 12-ounce cup of coffee will go up in cost by 10 cents, a Starbucks spokesman said.

This price hike at Starbucks comes after a rash of other increases. Some drinks in California and South Florida became pricier in November, so those regions were excluded from this recent increase. That's after Starbucks raised prices in 2010, then again in early 2011.

We all are paying more these days for essentials like milk and transportation and electricity, so the motivation isn't exactly a mystery. The U.S. inflation rate is tracking a roughly 3.4% annual rate based on recent data.

But that doesn't make the coffee price change any easier to swallow - especially considering Starbucks has seen its year-over-year revenues increase for eight consecutive quarters, and has seen 10 straight quarters of profit increases. It's not exactly like SBUX is going bankrupt because of coffee costs.

What's more, other restaurants have been passing on their cost burden to consumers in an effort to prop up their bottom line. McDonald's (MCD) is in many ways a top competitor of Starbucks with its McCafe line, and McDonald's raised menu prices on a host of items in 2011. Burrito broker Chipotle (CMG) is in the same boat, in June announcing a price hike as food costs jumped from 32% to 35% of its overall business expenditures.

If you think you can stop eating out to avoid this trend, think again. Inflation is eating away at family food budgets, from items like peanut butter and ground beef to soy and Coca-Cola (KO) soft drinks. Heck, even Thanksgiving was a price shock - with the cost of a traditional turkey dinner up 13%, or $6 per household.

So if your New Year's resolution was to save a few more bucks this year by cutting costs, the reality is you probably will have to pair that with another goal: going on a diet.

Jeff Reeves is the editor of InvestorPlace.com. Write him at editor@investorplace.com, follow him on Twitter via @JeffReevesIP and become a fan of InvestorPlace on Facebook. Jeff Reeves holds a position in Alcoa, but no other publicly traded stocks.

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Depending on how you view things, we either are in heaps of trouble economically or about to emerge from a terrible recession. Personally, I think it's the former. I always like to have a few trades on my watch list to take advantage of possible crises, as uncertainty creates opportunity. So in looking ahead for 2012, I'm looking to exploit other people's woes like the good capitalist I am.

Here are three bets I'd be pretty comfortable researching in greater detail and possibly pull the trigger on:

Bill Gross, of the famed PIMCO funds, has been a bond guy all his life, and he went bearish on bonds earlier this year. Hell froze over. You can see this either as capitulation or an ominous warning. I am very wary of municipal bonds. Our own country's debt crisis has reached all the way down to municipalities.

When it was revealed that the bond insurers did not have nearly the capital necessary to make payouts on defaulted collateralized debt obligations during the mortgage crisis, I lost all faith in bond insurers. To me, there is an equivalent risk and higher reward with preferred stocks. By purchasing a basket in an ETF such as iShares S&P Preferred Stock Index Fund (NYSE:PFF), you give yourself a 7% yield with minimal volatility. Get out if interest rates rise significantly, though.

Underfollowed and under-read fund manager Robert Rodriguez is a genius. He thinks we're headed for more recession next year, and Congress has been inept in its handling of fiscal policy. I agree. He hates bonds right now, except for very short-duration bonds, and so do I. Prices are near a double-top. I think bond prices will get hit next year, so I might short the iShares Barclays 20+ Treasury Bond Fund (NYSE:TLT).

Going hand-in-hand with our economic crisis has been the decline of the dollar. That trend will continue. That means you can short the dollar via PowerShares DB US Dollar Index Bearish (NYSE:UDN).

The real question at hand is this: Why the heck is the market doing so well in the face of really bad economic times? If you read my recent series on the Dow Jones Industrial Average, you know about several Dow stocks that would make for good long-term additions to a portfolio. That is the key to understanding investment in the market going forward - careful individual stock picking. Go with large-caps in general, and only go with small-caps that are directly benefiting from the situation. As for other systemic shocks that might or might not happen, have your trigger finger ready for these possibilities.

I expect some trigger event to knock the market down 20%. Perhaps it will come from Europe. Or, if Obamacare is upheld by the Supreme Court, expect the market to correct significantly. It will be a sign that overreaching regulation and legislation is acceptable to the High Court, and that's bad for business. However, if it is overturned, then go long Health Care SPDR (NYSE:XLV). Likewise, should Obama be re-elected, the market will react badly. So look at ProShares Short S&P 500 (NYSE:SH). If Obama is kicked out and the GOP takes over Congress, I expect a market surge, so you could go long the market with SPDR S&P 500 ETF (NYSE:SPY).

Stay far away from financials. There might be another big shock coming to the system. I am wary of Bank of America's (NYSE:BAC) stability, and certain sources tell me that the bad behavior of bond insurers, reinsurers and investment banks hasn't changed a bit. If you want to make an aggressive bet on this arena, double-short financials via ProShares UltraShort Financials (NYSE:SKF).

Finally, if you really want to bet against improvement in the global economic situation, believe Obama will be re-elected, that Europe will crater, that commodity prices will once again skyrocket, and that the dollar will crash, then you can short the market big-time via ProShares UltraPro Short S&P 500 Index Fund (NASDAQ:SPXU) and ProShares UltraPro Short Nasdaq 100 ETF (NASDAQ:SQQQ). These babies give you 3x leverage on your short bet.

Of course, all of these are highly speculative plays based on highly speculative crises of 2012. As always, do your own research and, for Heaven's sake, use stop-losses.

Lawrence Meyers does not hold a position in any securities mentioned but may have a position in several stocks the ETFs own. Check out InvestorPlace.com's other looks back at 2011 and ahead to 2012 here.

The purchase of Blockbuster is an important strategic shift for Dish. It means the company is flexing its muscle in an attempt to become a major player.

But more importantly for consumers, it may mean more viewing options and competitive pricing for consumers. Blockbuster's online content library could give Dish Network an opportunity to create an online product to supplement the viewing experience - akin to Netflix offering mail-order DVDs alongside streaming content.

More Reasons for Dish Competitors to Worry

That's just speculation, but it would align with the overall goal of Dish Network to provide a top-notch experience even as it is seen as a low-cost option. In recent years network has expanded HD offerings, on-demand movies and channel selection to make quality a bigger part of the equation.

And now that Dish Network has snapped up Blockbuster and its content, customers may find many more reasons to like Dish Network than just the smaller monthly bill. That means rivals better take notice in the wake of the $320 million bankruptcy sale.

Of course, it is going to be an uphill battle for Dish. Netflix now has 20 million viewers, and its stock has skyrocketed over 700% in the last five years. DirecTV revenue for 2011 is slated for $26.5 billion - growth of over 50% from fiscal 2006 - and the stock has soared over 180% in the last 5 years. This growth isn't anything to sneeze at.

And by contrast Dish network has sadly been left out of the party recently. Shares and revenue haven't shown much action at all over the last five years. It has been soundly profitable, but Dish has clearly been a secondary player in a secondary television provider market.

Still, the purchase of Blockbuster - and the $1.4 billion purchase of hybrid satellite-landline communications provider DBSD North America earlier this year - means Dish is flexing its muscle. Likely results could be more viewing options and competitive pricing for consumers, and the chance that DISH stock could break out of its slump.

Obviously no one should be counting chickens before they are hatched. The winning bid must still be approved by a bankruptcy court on Thursday, and Dish clearly has a long way to go. Entrenched cable giants like Comcast are digging in, NFLX is the undisputed king of online content and is rolling out original Netflix programming, and satellite leader DirecTV isn't going to give up any of its 19 million-plus subscribers without a fight.

But moving sideways for another five years just isn't an option if Dish Network wants to stay around. The timing and fire-sale price of Blockbuster assets makes the move a smart one, regardless of whether it pays off.

Jeff Reeves is editor of InvestorPlace.com. As of this writing, he did not own a position in any of the stocks or funds named here. Follow him on Twitter via @JeffReevesIP and become a fan of InvestorPlace on Facebook.