Healthcare fix asks US creditors for leap of faith 19 Mar 2010 The plan edging towards law in Congress is supposed to cut future U.S. deficits. But it depends on politicians following through on cuts and taxes, a deficit commission imposing additional discipline, and reforms working as expected. Owners of Treasuries shouldn't bank on it.
Bad recession only dented quest for good looks 10 Mar 2010 Americans were ready to delay surgery to make breasts larger and waistlines smaller, but couldn t resist the lure of fuller lips and fewer wrinkles. The tough economy in 2009 only brought a 2 percent cut in cosmetic procedures. Vanity spending seems to have become a necessity.
Obama health plan travels further down wrong path 22 Feb 2010 It costs $75 bln more than the U.S. Senate proposal, limits a tax on highend plans and increases regulation by trying to limit price hikes. Worse, the president s bid to break a political impasse will further polarize Congress. A tactical win could become a strategic loss.
L’Oreal needs discipline after ditching EPS goal 16 Feb 2010 The French beauty group is scrapping its doubledigit EPS growth target, rightly saying the goal can distort strategy and curb investment. The risk is that L Oreal drifts into profligacy after two decades of discipline. A robust dividend policy should prevent that.
Buyout barons’ mega-deals may yet deliver 8 Feb 2010 A couple of giant boomera buyouts wiped investors out. But others on the top 20 list have scraped through the crisis. Investors in HCA now appear well in the money on paper. Woes at Freescale and even Clear Channel are waning. But private equity bosses still have work to do.
Carl Icahn needs to justify his Biogen escalation 28 Jan 2010 The veteran activist gave the biotech firm the shakeup it needed. He won two board seats, ousted the CEO and put the company on the block. Unless he has more, better ideas, his 6 pct stake doesn't merit the extra board representation he wants. If not, he should just buy Biogen.
US Senate turnover could force pro-market shift 26 Jan 2010 The Democrats' loss of the Kennedy seat in the Senate may just be the start. Republicans have a chance of retaking both houses of Congress in November's elections. As with the Clintonera Democratic implosion of 1994, Obama might have to adopt a more marketfriendly agenda.
New Novartis CEO inherits unfinished business 26 Jan 2010 Joe Jimenez has a big todo list at the Swiss drugs group. Shortterm, he must resolve the impasse with minorities at Alcon and raise $16 bln to pay for Nestle's stake in the eye care firm. The strategic challenge is even greater: maintaining growth as blockbuster patents expire.
Investors better off fixing, not flipping, Genzyme 15 Jan 2010 The $14 bln U.S. biotech is getting a muchneeded shakeup. Relational Investors is backing management for now. But Carl Icahn, with a history of forcing companies into auctions, hovers. A sale might book a quick gain but a smaller, more focused firm would be more valuable.
US health reform may cost investors 13 Jan 2010 Labor unions are balking at Obama s move to tax their health benefits to pay for reform. So Democrats are considering taxing investment income. That s a bad idea. Not only might it raise the cost of reform and worsen the deficit, it could politically doom the whole plan.
Obama rightly urges tax on gold-plated healthcare 7 Jan 2010 To the dismay of deficit worriers, U.S. healthcare reform has shifted focus from reducing costs to expanding insurance coverage. So the new White House push to tax pricey health plans is welcome. Though more needs to be done, this is the best costcontainment idea out there.
Healthcare reform could worsen US deficit 29 Dec 2009 Uncle Sam s creditors in Beijing and elsewhere have repeatedly questioned the budgetary impact of healthcare reform. Skepticism is merited. The justpassed Senate bill employs some Enronesque bookkeeping tricks to improve the fiscal picture.
U.S. healthcare bill won’t fix big inefficiencies 21 Dec 2009 The Senate version, now probably in nearfinal form, will bring health coverage to more people and usefully calls for things like insurance exchanges. However, it worsens the crosssubsidies built into the US healthcare system and risks adding yet more cost.
TPG patches together $5.2bn post-crisis buyout 5 Nov 2009 The private equity firm is leading a buyout of drugs market research company IMS. But oldstyle LBO financing is missing. The buyers are putting in a whopping 40% as equity. The rest is coming courtesy of Goldman and mostly from funds it manages, not its own balance sheet.
Market softens up CVS Caremark for US regulators 5 Nov 2009 The Federal Trade Commission fancies the drugs group as an antitrust target. Investors, meanwhile, gave its stock a beating after the company lost contracts worth billions in the latest quarter. The market is helping overworked officials by putting CVS Caremark on the back foot.
US healthcare bill twists already tangled system 13 Oct 2009 The bill approved by the Senate Finance Committee does increase healthcare coverage. But it adds complexity in areas like crosssubsidisation and fails to tackle widely recognised problems like lawsuits. It risks making the system even less economically efficient.
US healthcare debate descends into irrationality 10 Sep 2009 You lie! a congressman yelled, breaking decorum, over Obama s contention that reform won t benefit illegals. It s an odd choice to get worked up over when the proposal has explicit restrictions on benefits to foreigners and far richer targets, like its price tag.
US health reform: a primer for the uninitiated 9 Sep 2009 President Obama is making a rare address to both houses of Congress on Wednesday evening in an effort to put his healthcare reform firmly back on the rails. Robert Cyran explains the issues, what went wrong and what might happen next.
Personal View: Healthcare may be Kennedy’s Compromise of 1850 26 Aug 2009 Like Henry Clay, Edward Kennedy was a flawed but hugely important US legislator, more so than several presidents. Like Clay s nationalism, Kennedy s career embodies a questionable principle, that of government as provider. Obama s health plan may end up as Kennedy s legacy.
US corporate profit surprises may not last 23 Jul 2009 A third of the way through the US reporting season, secondquarter earnings look far better than expected thanks to cost and inventory cuts. But those are relatively quick, easy fixes. Longer term, profits depend on economic growth and rising sales. Those will come more slowly.