Tag: Business and finance

FOR much of the past two years, market watchers have had little to write about, apart from the passing of one stock-index milestone after another. The events of the past week, however, have shaken the financial world awake. A recent, upward zag in bond yields seemed to signal the arrival of a new theme in market movements. Stock prices confirmed it, and then some. Over the past week, American stocks have dropped about 7%, punctuated by a breathtaking, record-setting plunge on Monday. The Dow Jones stock index recorded its largest ever one-day drop, of more than 1,000 points. In percentage terms the decline, of more than 4%, was the biggest since 2011.

The swoon set tongues to wagging, about its cause and likely effect. There can be no knowing about the former. Markets may have worried that rising wages would crimp profits or trigger a faster pace of growth-squelching interest-rate increases, but a butterfly flapping its wings in Indonesia might just as well be to blame. There is little more certainty regarding the latter. Commentators have…Continue reading

FEDERAL guidelines in America stipulate that airlines must allow passengers with disabilities to bring support animals onto flights. The rules were originally designed with guide dogs for the blind and the like in mind. Yet in recent years the rules have allowed a host of unusual and exotic animals to board planes for their owners’ emotional wellbeing.

Last weekend United Airlines, America’s third-largest carrier, drew the line at a peacock. A woman arrived at Newark International Airport and attempted to board her flight with the large bird, which she claimed was an emotional-support animal. The Jet Set, a travel show, captured images of the bird as it was denied boarding (see picture). The airline told the Washington Post that the peacock “did not meet guidelines for a number of reasons, including its weight and size” and that “we explained this to the customer on three separate occasions before they arrived at the airport.”

Service animals, including emotional-support animals, can generally fly for free. As…Continue reading

Rien ne va plus

EVEN in a business where the house always wins, Steve Wynn is used to winning more than anyone else. The casinos that the billionaire has built, from The Mirage and Bellagio to Wynn Macau and Wynn Palace, helped transform Las Vegas and Macau from seedy gambling joints into luxury high-roller destinations. His fiercest rivals heaped praise on him as a visionary and perfectionist. His company, Wynn Resorts, enjoyed a “Wynn premium” from analysts and investors.

Now he could lose control of his empire. On January 26th the Wall Street Journal published an investigation detailing numerous allegations that would amount to a decades-long pattern of sexual misconduct by Mr Wynn. The board of Wynn Resorts has announced an inquiry by a special committee into the reports, the veracity of which Mr Wynn denies.

He has resigned as finance chairman of the Republican National Committee. Gaming commissioners in Nevada, Macau and…Continue reading

LUANN STOTTLEMYER has had diabetes for 23 years, but it was only in 2016 that her doctor prescribed a treatment that changed her life. It has allowed her to bring her blood-sugar levels under control and lose weight. Yet this miracle of modern science is not a new pill. It is a smartphone app called BlueStar.

The program is one of a growing number of apps that America’s Food and Drug Administration (FDA) has approved to treat everything from diabetes to substance abuse. The FDA has encouraged firms to join a scheme that aims to streamline the regulatory process for such treatments. There are many candidates: at least 150 firms globally are developing some form of “digital therapeutic” (“digiceutical” in the lingo), says Mark Sluijs, who advises Merck, a big American drugmaker.

Unlike other sorts of digital health apps, digiceuticals have been tested for efficacy, approved by regulatory agencies such as the FDA and are prescribed by a doctor. Most gather data, either by asking patients for information or by using sensors,…Continue reading

EUROPE is home to some extraordinary wealth creators who often try to hide their success. Ingvar Kamprad, a Swedish farmer’s son, constructed IKEA, a seller of flat-pack furniture that became a global giant with annual revenues of €38bn ($47bn). He died at the age of 91 on January 27th, after a famously frugal life. Amancio Ortega, the Spanish son of a railway worker, founded Inditex, a fast-fashion giant, and shuns any media attention. Then there is the reclusive Reimann family of Germany, members of which reportedly take a vow at the age of 18 not to talk publicly about their business, JAB Holding, a Luxembourg-based investment group.

Yet JAB’s habit of gulping down big, famous firms at a frenetic pace is making it hard for it to stay in the shadows. On January 29th it said it will pay $18.7bn in cash (plus some shares) to buy Dr Pepper Snapple, the world’s fifth-biggest maker of soft drinks, which has roots dating back to 1885. It will be combined with Keurig Green Mountain, an American…Continue reading

THE past decade has seen the smartphone become a portal for managing daily life. Consumers use their pocket computers to bank, buy and befriend. Now this array of activities is expanding into an even more vital sphere. Apple has spent three years preparing its devices and software to process medical data, offering products to researchers and clinical-care teams. On January 24th it announced the result. The next big software update for its iPhone will include a feature, Health Records, to allow users to view, manage and share their medical records. Embedded in Apple’s Health app, the new feature will bring together medical data from participating hospitals and clinics, as well as from the iPhone itself, giving millions of Americans direct digital control of their own health information for the first time.

Apple’s fellow tech giants are also on the march into medical services. On January 30th Amazon announced a partnership with Berkshire Hathaway and JPMorgan Chase to create a not-for-profit…Continue reading

Engro’s national mission

PAKISTAN’s enormous mineral wealth has long lain untapped. Since a 1992 geological survey spotted one of the world’s largest coal reserves in Thar, a scrubby desert in the southern province of Sindh, prospectors have hardly dug up a lump. Among those to flounder is a national hero. Samar Mubarakmand, feted for his role in Pakistan’s nuclear-weapons programme, has just shut the coal-gasification company he founded in 2010, when he vowed on live television to crack Thar.

Environmentalists, many from abroad, argue the reserve’s 175bn-ton bounty should remain underground. They point out the coal is lignite—dirty, poor-quality stuff that, in adding to carbon emissions, increases the risk of climate change for Pakistan. Other critics note that by locking itself into coal, Pakistan may miss out on the plummeting price of solar energy.

To such qualms, the government offers three rejoinders. First, severe power shortages have long…Continue reading

IN A few years, millions of people will use a messaging app to make instant payments to friends across the globe or in a digital marketplace. But instead of state-backed money, they will use a cryptocurrency, the Gram, denoted by a gemstone emoji. They will be able to pay to store data—and perhaps to view content—securely and away from governments’ prying eyes. All of this will take place on a single platform, TON, or “The Open Network”, built by Telegram.

This is the vision that Telegram’s founders, the brothers Pavel and Nikolai Durov, are flogging to investors ahead of their initial coin offering (ICO). A “presale” round to institutional investors is under way, with a wider sale of Grams to retail investors expected in a few weeks. Reports suggest the offering could raise as much as $1.2bn, making it by far the largest ICO.

Compared with other firms selling tokens on the back of vague promises, Telegram has lots going for it. Its encrypted messenger app, particularly popular with the global crypto crowd, is…Continue reading

IN A few years, millions of people will use a messaging app to make instant payments to friends across the globe or in a digital marketplace. But instead of state-backed money, they will use a cryptocurrency, the Gram, denoted by a gemstone emoji. They will be able to pay to store data—and perhaps to view content—securely and away from governments’ prying eyes. All of this will take place on a single platform, TON, or “The Open Network”, built by Telegram.

This is the vision that Telegram’s founders, the brothers Pavel and Nikolai Durov, are flogging to investors ahead of their initial coin offering (ICO). A “presale” round to institutional investors is under way, with a wider sale of Grams to retail investors expected in a few weeks. Reports suggest the offering could raise as much as $1.2bn, making it by far the largest ICO.

Compared with other firms selling tokens on the back of vague promises, Telegram has lots going for it. Its encrypted messenger app, particularly popular with the global crypto crowd, is…Continue reading

DENMARK’S Maritime Museum in Elsinore includes one particularly unappetising exhibit: the world’s oldest ship’s biscuit, from a voyage in 1852. Known as hardtack, such biscuits were prized for their long shelf lives, making them a vital source of sustenance for sailors far from shore. They were also appreciated by a great economist, Irving Fisher, as a useful economic metaphor.

Imagine, Fisher wrote in “The Theory of Interest” in 1930, a group of sailors shipwrecked on a barren island with only their stores of hardtack to sustain them. On what terms would sailors borrow and lend biscuits among themselves? In this forlorn economy, what rate of interest would prevail?

One might think the answer depends on the character of the unfortunate sailors. Interest, in many people’s minds, is a reward for deferring gratification. That is one reason why low interest rates are widely perceived as unjust. If an abstemious sailor were prepared to lend a biscuit to his crewmate rather than…Continue reading