Listen to this article
Sign up to receive FirstFT by email here
Warren Buffett has taken a $1bn-plus stake in Apple just four years after admitting he did not know how to value technology companies. News of Mr Buffett’s rare bet on a tech group sent Apple shares up as much as 4 per cent.
Mr Buffett, a fan of inexpensive stocks with predictable cash flows, has long eschewed tech investments out of concern that even the industry’s leaders could be undermined by fast-changing markets.
“The investment is yet another sign that the iPhone maker’s days of explosive growth might be permanently fading into the past,” writes Quartz. Mr Buffett’s Berkshire Hathaway specialises in “value investing”, a strategy in which investors buy and hold the stocks of companies with strong cash flow, decent dividends, defensible businesses and experienced management at moments when they have fallen out of favour with the market. (FT, Quartz)
In the news
Hillary Clinton sees role for Bill In an election year when Bill Clinton’s policies and personal indiscretions have faced intense scrutiny, Hillary Clinton is beginning to shape the role her husband would play in her administration, zeroing in on economic growth and job creation as crucial missions for the former president. Mrs Clinton told voters in Kentucky that Mr Clinton would be “in charge of revitalising the economy, because, you know, he knows how to do it”, especially “in places like coal country and inner cities”. (NYT)
IMF presses EU over Greek debt The IMF is pressing the eurozone to let Greece skip paying interest or principal on bailout loans until 2040, say officials familiar with the talks. The IMF wants the loans to Greece to fall due gradually in the following decades, and as late as 2080, according to the IMF’s proposal. (WSJ)
Arming Libya The US and other world powers have agreed to support sending arms to the internationally recognised Libyan government to help it fight Isis, in a rare show of unity from the global community. (FT)
China conducts ‘digital security’ reviews Chinese authorities are quietly scrutinising technology products sold in China by Apple and other big foreign companies, focusing on whether they pose potential security threats and opening up a new front in an already tense relationship with Washington over digital security. The tech companies have been subjected to reviews that target encryption and the data storage of tech products, said people briefed on the reviews. (NYT)
Starbucks to sell ‘sustainability bonds’ Starbucks plans to raise $500m to pay for so-called sustainable projects, including support programmes for farmers in coffee-growing regions. The Seattle-based coffee chain said it would sell 10-year bonds to go towards those projects. (WSJ)
Asian budget airlines join forces to fight legacy carriers A group of eight budget airlines based in Asia have formed the world’s largest alliance of low-cost carriers, hoping to broaden their customer base. The octet includes affiliates of legacy carriers Singapore Airlines, Thai Airways International and Japan’s All Nippon Airways. (NAR)
Girls outscore boys in tech tests There’s a dearth of female employees at tech companies, but that doesn’t mean girls don’t have the skills or knowledge to succeed in that field. New results from the US National Assessment for Educational Progress, also known as the Nation’s Report Card, show that eighth-grade girls are, on the whole, outperforming boys in measures of technology and engineering literacy. (HuffPo)
It's a big day for
Syria Peace talks will resume in Vienna, with the US, Russia, Iran, Turkey, China and other countries taking part.
Myanmar The Obama administration is expected to announce that it is maintaining the major sanctions that still remain on Myanmar, although it will take some names off its blacklist. (FT)
GMO foods The US National Research Council releases a multiyear research report about genetically engineered crops and food.
Food for thought
Trump, Putin and the allure of the strongman The Trump phenomenon is better understood as part of a global trend: the return of the “strongman” leader in international politics, writes Gideon Rachman. “All these men have promised to lead a national revival through the force of their personalities and their willingness to ignore liberal niceties.” (FT)
Laplanche’s last days at LendingClub Two weeks before his removal, LendingClub founder Renaud Laplanche accepted a “disruptive innovation” award in New York for his part in building the largest online lender in the US by volume. Investors believed LendingClub was one of the strongest companies in the fast-growing business of putting borrowers and investors together through technology. In fact, it had grown so fast that its internal controls couldn’t keep up. (WSJ)
Unethical amnesia A study published in the Proceedings of the National Academy of Sciences indicates that when we act unethically, our memories tend to be hazy. Researchers coined the term “unethical amnesia” to describe this phenomenon, which they believe stems from the fact that memories of ourselves acting in ways we shouldn’t are uncomfortable. “Unethical amnesia is driven by the desire to lower one’s distress that comes from acting unethically and to maintain a positive self-image as a moral individual,” the authors write. (Quartz)
The battle to beat the bugs An interactive look at how biosecurity "weaponry" is helping to halt the global spread of non-native species, from rampaging caterpillars to giant hornets. (FT)
From pitch to boardroom While footballers’ retirement plans commonly involve going into management, punditry, or perhaps running a pub, Arsenal midfielder Mathieu Flamini’s concerns about climate change persuaded him to go into business. The French soccer player co-founded GF Biochemicals, which produces a chemical called levulinic acid from waste wood, which can then replace oil in a range of products from fuel to plastics. (FT)
Video of the day
Can the US election affect Fed policy? Claims that political considerations could influence the Federal Reserve’s policy ahead of an election are far from new. Sam Fleming looks at how the central bank behaved in previous election years and if there is a historical precedent. (FT)