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Beverage giants like Coca-Cola (KO) and Pepsico (PEP) continue to invest in their water brands Dasani and Aquafina, however with a new focus in mind — the environment.
(Bloomberg Opinion) -- Indonesia’s president wants to spend at least $30 billion to move the capital to a forest on the island of Borneo. The proximate trigger is climate change – Jakarta is sinking into the sea. President Joko Widodo is planning a giant wall to keep big waves out, but global warming presents a clear danger to low-lying cities. After analyzing 393 cyclone-vulnerable coastal cities in 31 countries, World Bank economists have concluded that 40% of the damage from storm-surge catastrophes would fall on three Asian cities — Jakarta, Manila and Karachi, Pakistan. The Philippines is shifting government offices from coastal Manila to higher ground: the old American air base of Clark City.No wonder Widodo wants to move to the province of Kalimantan in Borneo, an island Indonesia shares with Malaysia and Brunei. The private sector and financial center will remain in metropolitan Jakarta, a megalopolis teeming with 30 million people. Yet in practice, the relocation will be a big prize for the private sector, with everything from real-estate development, urban gas supply, hospital management and many others up for grabs. The move is planned to start around 2024.What kind of capital will the nation of 267 million people get? A Naypyidaw, the nearly empty new city in central Myanmar conceived by a military junta? Or something more like Brasilia, which Brazil carved out of the Amazon in the 1960s to lessen the over-arching role that Rio de Janeiro had played since Portuguese colonial times? Widodo will be hoping for a Brasilia and to shake up the primacy of Java, the main island of the more than 18,000 that make up Indonesia. The move could also tilt the economic growth model away from state-owned enterprises, which are playing a bigger role since the president, known as Jokowi, came to office in 2014 and pledged to develop infrastructure in far-flung parts of the country.Indonesia has a historic mistrust of private enterprise. The resource-rich archipelago was plundered by foreign concessionaires and their cronies under former President Suharto’s 32-year dictatorship, which collapsed in the 1998 Asian crisis. Since then, Indonesia has been maturing as a democracy and stars like the ride-hailing app Gojek are the face of a youthful new private sector. A $30 billion new city project can be a playground for creativity – or a den of corruption. Indonesia has to choose wisely.A similar choice exists for the environment. The annual haze that engulfs Singapore and Malaysia emanates in part from forest fires in Kalimantan as farmers clear land for plantations. Will having the president in the neighborhood improve the policing of oil-palm estates? If the foul air quality in the Indian capital of New Delhi because of paddy-stubble burning in Punjab is any guide, the answer isn’t obvious. But if Jokowi does succeed, it will be a PR coup — European ambassadors’ children living in Kalimantan could persuade their home countries to stop objecting to the use of Indonesian palm oil in biofuel. That would safeguard the livelihood of 6% of Indonesians. The history of planned, new capital cities is mixed. The broad boulevards of Naypyidaw still await that one ingredient without which no city is complete: people. But there are successes. Why shouldn’t moving the seat of political power give Indonesia its own Canberra? The century-old, low-profile Australian capital is home to 400,000 residents. How hard can it be to fill a new urban agglomeration with 1.5 million inhabitants, asks Bambang Brodjonegoro, the minister of national development planning. Indonesia has 11 times as many people as Australia. Then there’s Brasilia. As Portugal did with Rio, the Dutch East India Company made Batavia – modern-day Jakarta – the epicenter of a vast trading network. And just as post-colonial Brazil felt the need to weaken Rio’s centrality, Jokowi has tasked Brodjonegoro to reduce the political role of Java, the most-populous island and a 59% contributor to annual GDP. Dated as Brasilia’s pioneering modernist look might seem now, the city helped change Brazil for the better. “Jakarta is in Java,” the minister tells me. “It reflects the Javanese identity.” But Indonesia is meant to be more than Java. If the idea is to reduce the entrenched homogeneity of majority Malay-Muslim Javanese power and diversify across the ethnic, cultural and religious mix that makes up ``Indonesian flavor,’’ as Brodjonegoro describes it, then the effort is praiseworthy.There’s no escaping the prevailing global zeitgeist of majoritarianism. By today’s standards, just wanting to lean against it makes Jokowi a very different kind of leader.To contact the author of this story: Andy Mukherjee at firstname.lastname@example.orgTo contact the editor responsible for this story: Patrick McDowell at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. Investors are bracing for a significant downturn in the world economy, cutting earnings estimates amid a market sell-off. While all cyclical industries face some form of risks, some companies within each sector are more vulnerable than others as the outlook deteriorates.In recent recessions, technology and finance were the triggers -- the internet bubble caused the 2000 market crash and subprime lending led to the 2008-2009 global financial crisis that spread to housing, manufacturing and consumer demand.“The financial sector was leading in 2002-2007. In this cycle, it’s the tech sector,” said Bloomberg Chief Equity Strategist Gina Martin Adams. Still, she cautioned that in spite of the warning signs, it may be too early to predict a recession, adding that “tech is the strength of the economy.”Here are five global companies that may stand to lose more than others:AmazonAmazon.com Inc. is among the most cyclical U.S. internet companies because the Seattle-based e-commerce giant relies heavily on consumer spending. It’s also been building its employee base, adding more than 600,000 jobs and hundreds of huge warehouses to store and ship products. Some of those costs are fixed, while others may be hard to reduce quickly if there’s a steep economic decline. It also faces regulatory risks.“Amazon’s near-term growth may be at risk as macroeconomic conditions worsen, regulatory scrutiny rises and spending cycles spark concern,” Jitendra Waral and April Kim, analysts at Bloomberg Intelligence, wrote in a recent note. “If demand were to slow amid Amazon’s increased spending on logistics, profit would face a double whammy.”One of Amazon’s fastest-growing new businesses -- digital advertising -- is also susceptible to economic ups and downs. Still, Amazon is riding a broad e-commerce growth trend that is unlikely to reverse during a recession.SwatchMakers of luxury items tend to endure more risks in a recession than producers of mass-market consumer goods. This time around, the effects would be compounded by U.S.-China trade tensions and protests in Hong Kong, which has already hurt the city’s economic outlook.Swatch Group AG, the biggest maker of Swiss timepieces, has more exposure to Hong Kong than any other luxury company, generating more than a third of the group’s sales in the Greater China region, according to Kepler Cheuvreux analyst Jon Cox. The maker of Omega watches also has a smaller presence in the steadier luxury categories of jewelry and fashion than rival Richemont, which owns brands including Chloe, Van Cleef & Arpels and Cartier.The high-end segment has also been far less elastic in a downturn. In 2009, Swiss watch exports slumped 22% amid the financial crisis.So far, the economic slowdown in China has done little to damp the appetite of Chinese consumers for luxury goods. But watchmakers are feeling the effects of the sometimes violent demonstrations in Hong Kong, their largest export market. Timepiece sales there could plunge as much as 40% in the second half, Cox said.Swatch also faces sluggish watch sales in Europe. If the U.S. takes a turn for the worse, the industry could be hit by a reversal of the recovery in its second-biggest market.Swatch ExportsDaimlerThe German corporate giant just doesn’t just face a slowdown in its home market -- it also has substantial exposure to a potential downturn in the U.S. The automaker produces two high-margin SUVs in Alabama and its Freightliner division is the leader in the North American heavy-truck market. Demand for transportation of goods tends to closely mirror broader economic swings and analysts say heavy-truck sales in the region have peaked following years of robust growth.Daimler AG relies on the U.S. for about a quarter of the group’s revenue last year. That’s more than Germany or China, where it operates a joint venture with BAIC.After two back-to-back profit warnings following their debut in May, Daimler’s new leadership duo has vowed to improve efficiency. Profitability at the Mercedes-Benz passenger-car division has been sub-par compared with its peers, and the car unit is up against waning demand in its two biggest markets by volume: China and the U.S.CaesarsAn economic downturn could be particularly ill-timed for Caesars Entertainment Corp. The largest owner of casinos in the U.S. is about to increase its debt load again to finance a megadeal, after struggling for years to recover from a 2008 leveraged buyout that left it saddled with debt at the height of the Great Recession. (Caesars ended up putting its largest division into bankruptcy to clean up its balance sheet.)Caesars is set to merge with Eldorado Resorts Inc. early next year in a deal that involves $8.2 billion in new financing, amid rising competition from new casinos, both online and at its properties. Unlike some of its peers that focus more on luxury, such as Wynn Resorts Ltd., Caesars operates a lot of casinos in small markets including Tunica, Mississippi, and Metropolis, Illinois. Combined with Eldorado, it will have 60 owned, operated and managed casino–resorts across 16 states.And even the Las Vegas Strip, once considered invincible as a gambling destination, has yet to see casino revenue return to its 2007 high.Toll BrothersA major economic slowdown would almost certainly hit home sales and prices for builders like Toll Brothers Inc. “If we do go into a recession, housing isn’t going to be the cause,” said Drew Reading, an analyst at Bloomberg Intelligence. “It’s going to be the victim.”The bigger challenge for the industry right now is affordability, especially in high-cost metros on the West Coast. Toll Brothers, the largest U.S. luxury homebuilder, has been trying to diversify geographically. But it’s still highly reliant on California, where it got nearly a third of its revenue last year.One the plus side: Single-family housing starts still haven’t returned to historical levels more than a decade after the financial crisis, which means homebuilders won’t be sitting on as much supply if the economy takes a turn for the worst.\--With assistance from Christoph Rauwald, Kevin Miller, Corinne Gretler, Noah Buhayar, Ian King, Christopher Palmeri and Alistair Barr.To contact the reporter on this story: Cécile Daurat in Wilmington at firstname.lastname@example.orgTo contact the editors responsible for this story: Crayton Harrison at email@example.com, Linus Chua, Steve GeimannFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Benzinga has examined the prospects for many investor favorite stocks over the past week. Bullish calls included tech leaders and a retail colossus. Bearish calls also included tech giants, as well as ...
This will be the third vacation Maegan Bagley will take that hasn’t cost her one red cent, and her second to Disney World.
Responding to recent reports on the difficult working conditions of Amazon warehouses, an army of totally real Amazon employees have begun defending the company on Twitter. House On Fire Amazon has been under fire for... a lot of things recently, from its connection to ICE to its facial recognition technology to its anti-union activities, but also for the reportedly back-breaking conditions of workers at its fulfillment center warehouses, where employees are often made to perform strenuous activities for hours at a time with little break; a report on these warehouses by Last Week Tonight With John Oliver recently went viral. It would seem Amazon is not taking the criticisms lying down, but their attempts to counter them on social media is not that convincing to many critics. This Is Fine In response to the negative attention, Amazon employees known as “FC ambassadors” (short for fulfillment centers) have been pushing back on Twitter, talking about how great it is to work there. The ambassadors first popped up last year, and seem to have picked up steam lately, after the Amazon News Twitter account invited followers to tour a center “to see what our warehouses are really like,” and the responding criticisms went viral. "Everything is fine, I don't think there is anything wrong with the money I make or the way I am treated at work,” was a typical response of one Ambassador. Mr. Roboto Critics of the FC Ambassadors mocked the “robotic” nature of their replies on Twitter, and there certainly is good reason to be suspicious of them. The New York Times reported that it seems like the users names and pictures of the FC accounts shift frequently, with the same talking points and stilted language reoccurring. A data analysis found that about 50 of the accounts were using the social media management tool Sprinklr, which is typically used by brands like Nike for online marketing. Amazon declined to tell the Times how many Ambassadors it employs. Prime The Pump On Prime Day last July, workers at an Amazon fulfillment center in Shakopee, Minnesota held a strike to protest unsafe working conditions. They were joined by engineers who flew to Minnesota to show solidarity. -Michael Tedder Photo: Carlos Jasso / REUTERS
Much has been made about the loss of two of its most popular shows, but over time, losses such as these will become less important.
These three defensive consumer stocks can add stability to your portfolio. These stocks deal with staples and are less susceptible to market volatility.
The new Mickey's Not-So-Scary Halloween Party Pass seems like a no-brainer way to boost theme-park revenue but could also be a lose-lose offering. It would be bad if it fails, but potentially even worse if it succeeds.
U.S.-China trade tensions could escalate next week following the expiration of an export ban against Chinese telecom giant Huawei
As the Democratic presidential candidates argue about “Medicare for All” versus a “public option,” two simple policy changes could slash U.S. health-care costs by 75% while increasing access and improving the quality of care. If they were rolled out nationally, the United States would save $2.4 trillion per year across individuals, businesses, and the government. The first policy—price tags—is a necessary prerequisite for competition and efficiency.
Liberal password sharing has gone hand-in-hand with the advent of subscription-based streaming services, and up to now, many companies haven’t been too bothered by who paying customers share their logins with. Disney, whose forthcoming streaming service Disney+ has already established itself as the single greatest existential threat against Netflix, given the sheer amount of desirable content the service will have, is reportedly going to crack down on streaming account sharing with help from its buddy in the cable industry. On Aug. 16, Disney struck a deal with Charter, the nation’s second-biggest cable company.
Two years ago, Chris Wane, a now 31-year-old living in Manchester, England, was struggling to pay his bills and often couldn’t afford enough food for the week. Wane started an e-commerce business and used drop shipping — a practice in which a retailer keeps no inventory and a third-party supplier sends consumers the products — to handle orders. “I heard about drop-shipping a couple of years ago, and I wanted to try it,” Wane said.
Harvard University’s endowment made some bold stock trades in the calendar second quarter. Harvard Management Co., or HMC, the entity that manages the endowment, oversaw $405 million in U.S.-traded equities as of June 30.