Amazon, Berkshire Hathaway and JP Morgan team up on US health care

Three corporate giants are teaming up to combat what billionaire Warren Buffett calls a “hungry tapeworm” feasting on the US economy: health care.

Amazon.com, Mr Buffett’s Berkshire Hathaway and JP Morgan said they plan to collaborate on a way to offer healthcare services to their US employees more transparently and at a lower cost. The three companies plan to set up a new independent company “that is free from profit- making incentives and constraints,” according to a short statement on Tuesday.

The move sent shares of healthcare stocks falling in early trading. Express Scripts and CVS Health, which manage pharmacy benefits, slumped 6.7 per cent and 5.5 per cent, respectively. Health insurers Cigna and Anthem also dropped.

The healthcare industry has been nervously eyeing the prospect of competition from Amazon for months. While the new company created by Amazon, Berkshire and JPMorgan would be for their US staff only, this is the first big move by Amazon into the industry. The new collaboration could pressure profits for middlemen in the US healthcare supply chain.

“Hard as it might be, reducing healthcare’s burden on the economy while improving outcomes for employees and their families would be worth the effort,” said the Amazon chief executive Jeff Bezos. “Success is going to require talented experts, a beginner’s mind, and a long-term orientation.”

Healthcare spending was estimated to account for about 18 per cent of the US economy last year, far more than in other developed nations. Despite efforts to curb costs, studies suggest that US doctors and hospitals continue to provide too much health care. In a survey of physicians' perspectives published last year in the journal PLOS One, the average estimate was that 20 per cent of medical care was unneeded, including about a quarter of tests, a fifth of prescriptions and more than one in 10 medical procedures.

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NMC acquires majority stakes in two healthcare operators for $207m

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Amazon, Berkshire and JP Morgan are among the largest private employers in the US, with a combined 1.2 million workers. And they’re among the most valuable, with a combined market capitalization of $1.6 trillion, according to data compiled by Bloomberg.

The effort is in its early planning stages, the companies said. It’s being spearheaded by Todd Combs, who helps oversee investments at Berkshire; Marvelle Sullivan Berchtold, a managing director of JP Morgan; and Beth Galetti, a senior vice president for human resources at Amazon.

Ms Sullivan Berchtold joined JPMorgan in August after eight years at the Swiss pharmaceutical company Novartis, where she was most recently the global head of mergers and acquisitions, according to her LinkedIn post.

The management team, location of the headquarters and other operational details will be announced later, the companies said.

Mr Buffett has long bemoaned the cost of US health care.

Last year, he came out in favour of drastic changes in the US health system, telling PBS New Hour that government-run health care is probably the best approach and would bring down costs.

The White Lotus: Season three

Creator: Mike White

Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell

Rating: 4.5/5

Know before you go

Jebel Akhdar is a two-hour drive from Muscat airport or a six-hour drive from Dubai. It’s impossible to visit by car unless you have a 4x4. Phone ahead to the hotel to arrange a transfer.
If you’re driving, make sure your insurance covers Oman.
By air: Budget airlines Air Arabia, Flydubai and SalamAir offer direct routes to Muscat from the UAE.
Tourists from the Emirates (UAE nationals not included) must apply for an Omani visa online before arrival at evisa.rop.gov.om. The process typically takes several days.
Flash floods are probable due to the terrain and a lack of drainage. Always check the weather before venturing into any canyons or other remote areas and identify a plan of escape that includes high ground, shelter and parking where your car won’t be overtaken by sudden downpours.

Dr Afridi's warning signs of digital addiction

Spending an excessive amount of time on the phone.

Neglecting personal, social, or academic responsibilities.

Losing interest in other activities or hobbies that were once enjoyed.

Having withdrawal symptoms like feeling anxious, restless, or upset when the technology is not available.

Experiencing sleep disturbances or changes in sleep patterns.

What are the guidelines?

Under 18 months: Avoid screen time altogether, except for video chatting with family.

Aged 18-24 months: If screens are introduced, it should be high-quality content watched with a caregiver to help the child understand what they are seeing.

Aged 2-5 years: Limit to one-hour per day of high-quality programming, with co-viewing whenever possible.

Aged 6-12 years: Set consistent limits on screen time to ensure it does not interfere with sleep, physical activity, or social interactions.

Teenagers: Encourage a balanced approach – screens should not replace sleep, exercise, or face-to-face socialisation.

Source: American Paediatric Association

Gorillaz
The Now Now

Panipat

Director Ashutosh Gowariker

Produced Ashutosh Gowariker, Rohit Shelatkar, Reliance Entertainment

Cast Arjun Kapoor, Sanjay Dutt, Kriti Sanon, Mohnish Behl, Padmini Kolhapure, Zeenat Aman

Rating 3 /5 stars

THE BIG THREE

NOVAK DJOKOVIC
19 grand slam singles titles
Wimbledon: 5 (2011, 14, 15, 18, 19)
French Open: 2 (2016, 21)
US Open: 3 (2011, 15, 18)
Australian Open: 9 (2008, 11, 12, 13, 15, 16, 19, 20, 21)
Prize money: $150m

ROGER FEDERER
20 grand slam singles titles
Wimbledon: 8 (2003, 04, 05, 06, 07, 09, 12, 17)
French Open: 1 (2009)
US Open: 5 (2004, 05, 06, 07, 08)
Australian Open: 6 (2004, 06, 07, 10, 17, 18)
Prize money: $130m

RAFAEL NADAL
20 grand slam singles titles
Wimbledon: 2 (2008, 10)
French Open: 13 (2005, 06, 07, 08, 10, 11, 12, 13, 14, 17, 18, 19, 20)
US Open: 4 (2010, 13, 17, 19)
Australian Open: 1 (2009)
Prize money: $125m

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Electoral College Victory

Trump has so far secured 295 Electoral College votes, according to the Associated Press, exceeding the 270 needed to win. Only Nevada and Arizona remain to be called, and both swing states are leaning Republican. Trump swept all five remaining swing states, North Carolina, Georgia, Pennsylvania, Michigan and Wisconsin, sealing his path to victory and giving him a strong mandate.

Popular Vote Tally

The count is ongoing, but Trump currently leads with nearly 51 per cent of the popular vote to Harris’s 47.6 per cent. Trump has over 72.2 million votes, while Harris trails with approximately 67.4 million.

WHAT IS A BLACK HOLE?

1. Black holes are objects whose gravity is so strong not even light can escape their pull

2. They can be created when massive stars collapse under their own weight

3. Large black holes can also be formed when smaller ones collide and merge

4. The biggest black holes lurk at the centre of many galaxies, including our own

5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed

Disclaimer

Director: Alfonso Cuaron

Stars: Cate Blanchett, Kevin Kline, Lesley Manville

Rating: 4/5

While you're here

Richard Heydarian: Decoding Asean's deliberate silence over the Myanmar coup

Kareem Shaheen: Our Myanmar reactions shaped by simplistic narratives

Sholto Byrnes: Washington tells South-East Asians to pick a side

Kareem Shaheen on Canada

A second lockdown will be especially tough in cold countries

Hard-hit Canada is springing back to the cliched 'new normal'

Justin Trudeau 2.0 will need to take all of Canada with him

Ticket prices

Golden circle - Dh995
Floor Standing - Dh495
Lower Bowl Platinum - Dh95
Lower Bowl premium - Dh795
Lower Bowl Plus - Dh695
Lower Bowl Standard- Dh595
Upper Bowl Premium - Dh395
Upper Bowl standard - Dh295

Sholto Byrnes on Myanmar politics

Why Myanmar couldn't rise to meet the world's expectations

Suu Kyi's unholy alliance with Orban is a new despicable low

The halo that once crowned Suu Kyi has been replaced

2025 Fifa Club World Cup groups

Group A: Palmeiras, Porto, Al Ahly, Inter Miami.

Group B: Paris Saint-Germain, Atletico Madrid, Botafogo, Seattle.

Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.

Group D: Flamengo, ES Tunis, Chelsea, (Leon banned).

Group E: River Plate, Urawa, Monterrey, Inter Milan.

Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.

Group G: Manchester City, Wydad, Al Ain, Juventus.

Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.

Will the pound fall to parity with the dollar?

The idea of pound parity now seems less far-fetched as the risk grows that Britain may split away from the European Union without a deal.

Rupert Harrison, a fund manager at BlackRock, sees the risk of it falling to trade level with the dollar on a no-deal Brexit. The view echoes Morgan Stanley’s recent forecast that the currency can plunge toward $1 (Dh3.67) on such an outcome. That isn’t the majority view yet – a Bloomberg survey this month estimated the pound will slide to $1.10 should the UK exit the bloc without an agreement.

New Prime Minister Boris Johnson has repeatedly said that Britain will leave the EU on the October 31 deadline with or without an agreement, fuelling concern the nation is headed for a disorderly departure and fanning pessimism toward the pound. Sterling has fallen more than 7 per cent in the past three months, the worst performance among major developed-market currencies.

“The pound is at a much lower level now but I still think a no-deal exit would lead to significant volatility and we could be testing parity on a really bad outcome,” said Mr Harrison, who manages more than $10 billion in assets at BlackRock. “We will see this game of chicken continue through August and that’s likely negative for sterling,” he said about the deadlocked Brexit talks.

The pound fell 0.8 per cent to $1.2033 on Friday, its weakest closing level since the 1980s, after a report on the second quarter showed the UK economy shrank for the first time in six years. The data means it is likely the Bank of England will cut interest rates, according to Mizuho Bank.

The BOE said in November that the currency could fall even below $1 in an analysis on possible worst-case Brexit scenarios. Options-based calculations showed around a 6.4 per cent chance of pound-dollar parity in the next one year, markedly higher than 0.2 per cent in early March when prospects of a no-deal outcome were seemingly off the table.

Bloomberg