NY Post : What’s Alibaba and why should you care?

Chinese Internet giant Alibaba is gearing up for its US market debut on Friday following what is widely expected to be the biggest initial public offering in history.
Only problem is, most Americans don’t know what the heck Alibaba is — or why they should care.
Alibaba is a Chinese e-commerce company founded in 1999 by Chairman Jack Ma, a former English teacher and martial arts enthusiast. Alibaba began as an online wholesale market for small companies, which Alibaba.com (1688.com in China) still does to this day.
But Ma also added a slew of other online entities — including Taobao, China’s largest online shopping destination — thus transforming Alibaba into that country’s largest e-commerce company.
Alibaba has a small presence in the US, although Ma has indicated plans to expand here and in Europe after the IPO.
Currently, US businesses can buy bulk goods through the company’s English-language Alibaba.com portal. Retail customers can access AliExpress and the more recently launched 11Main.com, which requires an invitation to join.
But Alibaba’s reputation among US consumers has been poor, including an “F” rating from the Better Business Bureau. The low rating is due to Alibaba’s failure to respond to 79 complaints against its businesses, including Alibaba.com and AliExpress, BBB’s ratings report said.
China is a different story. There, Alibaba’s three retail e-commcerce sites — Taobao, Tmall and Juhuasuan — helped vendors transact $296 billion in sales for the 12 months ended June 2014, which is more than eBay and Amazon combined.
Unlike Amazon, however, Alibaba doesn’t sell products. It acts as the middleman between the buyer and seller and makes its money mostly from advertising and membership fees.
For the year ended in March, Alibaba grew revenues by a whopping 52.1 percent, to $8.4 billion. That number pales in comparison to Amazon’s $74.5 billion in sales in 2013. But Alibaba’s bare-bones strategy is also expected to help it cap costs and boost profits.
Most of the hype surrounding Alibaba comes from Wall Street. A slew of banks, including Goldman Sachs, JPMorgan Chase and Morgan Stanley, are busy selling 368,122,000 Alibaba shares to investors at a price between $66 and $68 a share.
If they succeed, Alibaba will raise a whopping $25 billion — more than Visa’s $19.7 billion IPO and Facebook’s $16 billion share sale. At that range, Alibaba will be worth a whopping $160 billion, more than Amazon’s $155 billion market value but below Facebook’s $200 billion.
Of course, owning Alibaba stock carries unique risks. One of the biggest is that US investors can’t directly own the entity that operates Alibaba, Taboa and its other e-ecommerce websites.
Instead, they must invest in a Cayman Islands holding company, known as Alibaba Group Holding, which has contractual rights to profits from the Chinese businesses.
This has some investing pros shaking their heads over the Alibaba IPO hoopla, saying it’s not worth the trouble.
“They might as well be on the moon,” Frederick “Shad” Rowe of hedge fund Greenbrier Partners said of Alibaba’s US shareholders.
“If something goes wrong, there’s absolutely nothing they can do about it,” he said, adding that Alibaba shareholders can too easily become “stuckholders.”

FT : Apple opens up with iOS 8 and targets the privacy high ground

Apple opens up with iOS 8 and targets the privacy high ground

Apple claims its latest annual update to its operating system for iPhones and iPads is its “biggest iOS release ever”. Those inured to its perpetual hyperbole may at first struggle to see any difference: the eight-year-old grid of apps and icons seems largely unchanged. But the boast is more than just a punning reference to the new iPhone 6, its largest phone yet.
While last year’s iOS 7 brought startling visual changes, it left much the same under the hood. This year’s upgrade – which was set to be released for download on Wednesday – brings a long list of tweaks to the iPhone’s basic utilities, such as photos, messages and its touchscreen keyboard. It also introduces a whole new way for apps to send data to each other behind the scenes.

Several of these improvements are to areas in which iOS has lagged behind Google’s Android. Years after the facility first appeared in Android, iPhone users can now choose whether they want to share the photo they have just taken in WhatsApp Messenger or Instagram, instead of just Facebook, Twitter or the small number of other apps that Apple has chosen to build into the operating system. This is a welcome concession to freedom of choice from a company that often seems to think it knows better than its customers.
Keys and notifications

Another trick Apple has borrowed from Android is the ability to swap the iPhone’s default keyboard for one with fancier features, such as SwiftKey. So good is SwiftKey’s predictive messaging at guessing what you want to write – by analysing your linguistic style from emails and texts – that its lack of availability on iPhone hitherto was almost worth switching to Android for.
Notifications are also getting handy tweaks that lift some ideas from Android, then improve them. With iOS 8, you can respond to a text message, “like” a Facebook post or accept a dinner invitation by sliding down on the notification as it appears at the top of the screen, without having to leave the app that you were looking at before the interruption.
Apple has also borrowed some features from chat apps to improve its iMessage. You can now send short audio clips, walkie-talkie-style, by holding then swiping up on a new microphone icon, and can also share your current location, which is faster than typing an address.
Privacy

Yet Apple is also going out of its way to avoid following Google in one key area: privacy. Google gives away many of its services – including Android – free, in exchange for data that can feed its personalised advertising business. To distinguish itself, iOS 8 asks for permission in a series of prompts whenever personal information is shared, whether with the iPhone itself or an app developer.
Location tracking is a prominent example. Whereas in previous generations of iOS, an app that needed to know your exact whereabouts would ask for permission just once, when first downloaded, iOS 8 reminds you of your decision with intermittent pop-ups that ask if you really do still need that flashlight app to know where you are all the time.
Health

IOS8 apple health app
Privacy concerns are particularly acute when it comes to our health information, which iOS 8 gathers into a new app called simply Health. If users give the OK, fitness apps such as MyFitnessPal or Fitbit – and, in future, the Apple Watch – can drop statistics about calorie consumption or distance walked into Health. There, it can be plotted on a timeline chart or, again with permission, shared with another app that might use the data differently. Think of it as a clearing house for your health data.
Apple has slapped new restrictions on app makers to prevent them from using health information to sell targeted advertising and promises that all health data are stored on the iPhone itself, not in the cloud. And to try to avoid more embarrassing incidents, such as Jennifer Lawrence’s stolen selfies, anybody who backs up their iPhone to iCloud can now protect it with two-step authentication, which sends a single-use passcode to your device as well as a traditional password when you log in. This should help Apple to win back some of that lost trust.
For the privacy conscious, these controls are welcome, even overdue. But while iOS 8 makes many improvements in usability, all those pop-ups asking for permission seem a clunky and awkward piece of design. Too many requests for consent are likely to lead to speedy, thoughtless dismissals rather than considered contemplations of whether an app’s privacy infringements are offset by the value it provides.
The verdict: Apple’s designers have made many improvements that make iOS 8 easier to use. But they may need to apply their considerable talents to improving the iPhone’s privacy controls in the same way they have spruced up messages, notifications and photos in this latest release.

FT : Israeli researchers link artificial sweeteners with obesity

Israeli researchers link artificial sweeteners with obesity

Consuming non-caloric sweeteners such as saccharin instead of sugar may promote obesity rather than prevent it, according to a study published in the scientific journal Nature.
The research, carried out at Israel’s Weizmann Institute, appears as health campaigners exert growing pressure on the food and drinks industry to cut the sugar content of their products – and many manufacturers are turning to artificial sweeteners instead.

The Weizmann scientists carried out a series of experiments with mice and people using three sweeteners – saccharin, sucralose and aspartame – that are commonly incorporated into low-calorie snacks and beverages. Sports and energy drinks often contain two different “intense sweeteners” as the chemicals are sometimes known.
The study found that all three induced metabolic changes such as glucose intolerance which are associated with diabetes and obesity, though the effect was strongest for saccharin.
“Artificial sweeteners were extensively introduced into our diets with the intention of reducing caloric intake and normalising blood glucose levels without compromising the human ‘sweet tooth’,” the Nature paper concludes.
“This increase in non-caloric artificial sweetener consumption coincides with the dramatic increase in the obesity and diabetes epidemics,” the authors say. “Our findings suggest that [sweeteners] may have directly contributed to enhancing the exact epidemic that they themselves were intended to fight.”
Although slimmers have been adding tiny tablets of saccharine to their tea or coffee instead of sugar for decades, the widespread addition of sweeteners to a wide range of processed foods and drinks is more recent.
Mintel, the consumer research company, estimates that 5.5 per cent of all food and drink products launched last year contained at least one sweetener, compared with 3.5 per cent in 2009 – an increase it attributes to the “demonisation of sugar”.
The findings could reinforce demand for natural sweeteners. Sales of zero-calories carbonated drinks have faltered recently despite their lack of sugar because of consumer concerns about artificial sweeteners. In response, Coca-Cola launched a naturally-sweetened Coke for the first time last year, having already experimented with Sprite. The new drink – Coca-Cola Life – has a sugar and calorie content that is two-thirds of regular Coke, helped by the addition of stevia, a natural sweetener.
Chart
But independent experts said people should take care in interpreting the findings. “This research raises caution that non-caloric sweeteners may not represent the ‘innocent magic bullet’ they were intended to be, to help with the obesity and diabetes epidemics, but it does not yet provide sufficient evidence to alter public health and clinical practice,” said Nita Forouhi of the UK Medical Research Council Epidemiology Unit in Cambridge.
Sir Stephen O’Rahilly, professor of medicine at Cambridge university, said the work appeared to contradict the findings of other studies that showed no association between the consumption of artificially sweetened drinks and the development of diabetes.
“This new report must be viewed very cautiously as it mostly reports findings in mice, accompanied by human studies so small as to be difficult to interpret,” Sir Stephen said.
The Israeli authors, however, insisted that their findings did chime in with research elsewhere showing links between artificial sweeteners, weight gain and diabetes risk. “In no way are we saying that sugary drinks are healthier than drinks with artificial sweeteners,” said Eran Segal of the Weizmann, “but these results should provoke debate about the current massive use of these sweeteners.”
The most original feature of the study is the way it provides a mechanism for the metabolic effects of artificial sweeteners. The researchers found that they caused big changes in the “gut microbiota”, the billions of beneficial bacteria that populate the human stomach and intestines. Medical experts have only recently come to appreciate that the microbiota play a vital role in metabolism and more generally in disease.
“The sweeteners have no calories and are considered to be inert,” said Dr Segal. “But in fact when they go through the gastrointestinal tract they encounter this huge ecosystem and disturb its balance.”
Though the Weizmann researchers are not ready to make recommendations for the general population, Eran Elinav, the study leader, said he personally had stopped putting artificial sweeteners into coffee as a direct result of the research.
“These findings support the widespread understanding that water is the healthiest drink option and that we should avoid sweet and sweetened drinks,” said Katarina Kos, a diabetes consultant at the University of Exeter. “Water is the best drink to control our blood sugar.”

FT : Drugs cost watchdog urges review of new drug adoption

Drugs cost watchdog urges review of new drug adoption

Britain’s drug cost watchdog has called for a review of the way new medicines are adopted in the NHS in the wake of criticism of its rejection of a series of expensive cancer treatments.
The National Institute for Health and Care Excellence said it wanted to draw the government, the health service, drugmakers and patient groups into a broad debate on access to new medicines.

Sir Andrew Dillon, chief executive of Nice, said the proposed review offered a chance for the pharmaceuticals industry to “reset” its relationship with the agency and the NHS.
One of the objectives would be to forge consensus on the NHS’s approach to expensive cancer drugs as the clock ticks down to the expiry in 2016 of a special £200m a year fund set up by David Cameron, prime minister, to pay for some oncology treatments rejected by Nice.
Nice has long been accused by some drugmakers and patient groups of setting too high a bar for life-saving medical innovation in its assessment of which products offer value for money to the NHS.
But Sir Andrew said he sensed a willingness on the part of industry to work with Nice on developing new models for drug pricing and appraisal that encouraged uptake of new medicines without busting the health budget.
“Most companies recognise the economic reality of the NHS because that’s their market,” Sir Andrew told the Financial Times. “Any commercial enterprise needs to understand the capacity of its market to purchase their products.”
He proposed the creation of an “office for innovation” within Nice that would work with companies during the drug development process to help them provide the evidence needed to demonstrate value.
He said the review should also look at new ways of “sharing risk” between drugmakers and the NHS – which could involve more flexible “performance-related” pricing that would rise or fall depending on how effective a new medicine turned out to be.
The proposals, endorsed by the Nice board on Wednesday, came after a six-month consultation on how the agency could adopt more “value-based” methods for assessing new medicines.
The consultation had been demanded by the Department of Health as it looks for ways to control the £13bn a year spent on pharmaceuticals in the face of rising prices for breakthrough drugs.
However, Nice said that the 900 opinions it received from 121 organisations were too divergent to come up with recommendations.
Instead, Sir Andrew said he would seek the government’s backing for a more wide-ranging review of “innovation, evaluation and adoption” of new treatments.
Drugmakers argue that Nice’s rejection of many new medicines – particularly for cancer – is undermining government efforts to promote the UK as a place to invest in life sciences.
Roche of Switzerland said last month that Nice was “no longer fit for purpose” after blocking its Kadcyla breast cancer drug, which typically extends life by about six months at a list price of £90,000.
While vowing to work with drugmakers, Sir Andrew said it was “essential that industry also recognises its role in making innovative treatments available to people at a fair price”.

FT : UK’s £1tn corporate pensions sector stands by hedge funds

UK’s £1tn corporate pensions sector stands by hedge funds

The embattled hedge fund industry was given a boost by the UK’s £1tn corporate pension fund sector that indicated it would not make a hasty exit from the asset class, as the investments fell out of favour in the US.
The National Association of Pension Funds, which represents 1,300 workplace pension schemes, with 15m members, said hedge funds “had a role to play” in providing returns for members, as influential funds in the UK and US branded the investments as “costly and complex”.

The hedge fund industry came under pressure this week after Calpers, the largest public sector pension fund in the US, said it was exiting its $4bn holding, on concerns the investments were too complicated and expensive.
In reaction, the £4.5bn London Pensions Fund Authority – the UK’s most influential public sector pension fund – said it understood Calpers’ decision and branded high hedge fund fees as “unjustifiable”.
Although the NAPF said there had been a gradual move away from hedge funds by its members towards diversified growth funds and infrastructure, it stressed that events in the US would not likely trigger any immediate rethink on asset allocations by its members.
“Pension funds have been looking at more riskier assets because bonds yields are so low,” said Helen Roberts, lead on policy investment with the trade body.
“Our members need to have a choice of strategies and assets. Hedge funds can suit some pension schemes but it depends on the specific pension fund,” the NAPF added.
Appetite for hedge funds among the UK corporate pension fund sector has grown in recent years. According to the Pension Protection Fund, corporate pension fund exposure to the investments has grown from 4.5 per cent in 2012 to 5.2 per cent of total assets, of £1.1trn, in 2013.
However, some investment advisers said many hedge funds would struggle to retain clients at the current fee levels unless they could demonstrate superior investment skills or access to assets and performance that is not available elsewhere.
“There is now a huge disconnect between the fees on hedge funds and the fees for mainstream long-only management and even fees on absolute return funds, which can protect against downside risk, have been falling,” said Dr Ros Altmann, an independent pensions expert.

>>> Federal Reserve releases FOMC Statement & Supplemental Economic Projections

Full release attached

Federal Reserve releases FOMC Statement & Supplemental Economic Projections
Information received since the Federal Open Market Committee met in July suggests that economic activity is expanding at a moderate pace. On balance, labor market conditions improved somewhat further; however, the unemployment rate is little changed and a range of labor market indicators suggests that there remains significant underutilization of labor resources. Household spending appears to be rising moderately and business fixed investment is advancing, while the recovery in the housing sector remains slow. Fiscal policy is restraining economic growth, although the extent of restraint is diminishing. Inflation has been running below the Committee's longer-run objective. Longer-term inflation expectations have remained stable.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators and inflation moving toward levels the Committee judges consistent with its dual mandate. The Committee sees the risks to the outlook for economic activity and the labor market as nearly balanced and judges that the likelihood of inflation running persistently below 2 percent has diminished somewhat since early this year.

The Committee currently judges that there is sufficient underlying strength in the broader economy to support ongoing improvement in labor market conditions. In light of the cumulative progress toward maximum employment and the improvement in the outlook for labor market conditions since the inception of the current asset purchase program, the Committee decided to make a further measured reduction in the pace of its asset purchases. Beginning in October, the Committee will add to its holdings of agency mortgage-backed securities at a pace of $5 billion per month rather than $10 billion per month, and will add to its holdings of longer-term Treasury securities at a pace of $10 billion per month rather than $15 billion per month. The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. The Committee's sizable and still-increasing holdings of longer-term securities should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative, which in turn should promote a stronger economic recovery and help to ensure that inflation, over time, is at the rate most consistent with the Committee's dual mandate.

The Committee will closely monitor incoming information on economic and financial developments in coming months and will continue its purchases of Treasury and agency mortgage-backed securities, and employ its other policy tools as appropriate, until the outlook for the labor market has improved substantially in a context of price stability. If incoming information broadly supports the Committee's expectation of ongoing improvement in labor market conditions and inflation moving back toward its longer-run objective, the Committee will end its current program of asset purchases at its next meeting. However, asset purchases are not on a preset course, and the Committee's decisions about their pace will remain contingent on the Committee's outlook for the labor market and inflation as well as its assessment of the likely efficacy and costs of such purchases.

To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that a highly accommodative stance of monetary policy remains appropriate. In determining how long to maintain the current 0 to 1/4 percent target range for the federal funds rate, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments. The Committee continues to anticipate, based on its assessment of these factors, that it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends, especially if projected inflation continues to run below the Committee's 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored.

When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent. The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run.

Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; Lael Brainard; Stanley Fischer; Narayana Kocherlakota; Loretta J. Mester; Jerome H. Powell; and Daniel K. Tarullo. Voting against the action were Richard W. Fisher and Charles I. Plosser. President Fisher believed that the continued strengthening of the real economy, improved outlook for labor utilization and for general price stability, and continued signs of financial market excess, will likely warrant an earlier reduction in monetary accommodation than is suggested by the Committee's stated forward guidance. President Plosser objected to the guidance indicating that it likely will be appropriate to maintain the current target range for the federal funds rate for "a considerable time after the asset purchase program ends," because such language is time dependent and does not reflect the considerable economic progress that has been made toward the Committee's goals.


>>> FOMC UPDATED ECONOMIC FORECAST FOR SEPT MEETING

FOMC UPDATED ECONOMIC FORECAST FOR SEPT MEETING: 
- Fed Rate Path Forecast: # official sees first hike in 2014 (1 prior), ## officials see first hike in 2015 (12 prior); ## see first hike in 2016 (3 prior). # see first hike in 2017
- Median forecast for 2016 rate is around % (prior 2.5%)