President Joe Biden used part of his State of the Union address this week to convince US voters that their financial futures will be better protected under his leadership than under Donald Trump's.
“Folks, I inherited an economy that was on the brink. Now, our economy is literally the envy of the world,” he said.
The President entered the Capitol building on Thursday night with dismal polling numbers, and one of the biggest complaints among voters is how he has handled the economy – even as it shows signs of strength.
Only 36 per cent of voters approve of how Mr Biden has handled the economy, according to a recent Gallup poll. This is despite strong job gains and wage growth, low unemployment and an economy that has beaten down recession fears.
But while inflation has fallen considerably since peaking at 7.1 per cent in 2022, food prices still remain high.
Grocery store prices increased 5 per cent last year, while prices for takeaway/restaurant prices increased by 7.1 per cent, according to the US Department of Agriculture.
Consumer confidence dipped last month because of “persistent uncertainty”, the Conference Board reported.
Mr Biden appeared to address the disconnect between the strong economy and dismal polling in his address.
“In a thousand cities and towns, the American people are writing the greatest comeback story never told,” he said.
A sizeable audience tuned in to hear Mr Biden's pitch. Early returns showed 27.7 million people watched his State of the Union address, a slight increase from 27.3 million last year.
Still, both figures represent a decline from the 38.2 million who watched him in 2022.
Biden pitches populist economic agenda
With the economy is set to partially define this year's election, Mr Biden rattled off a list of his accomplishments and populist economic policies throughout his 66-minute speech.
Those accomplishments included 15 million jobs added – which were regained from job losses suffered when the Covid-19 pandemic first hit in 2020 – domestic production of semiconductor chips and the 2022 bipartisan infrastructure bill.
He also laid out a populist economic policy approach, promising to eliminate so-called junk fees and lower the cost of insulin and prescription drugs.
“I’m going to get in trouble for saying that, but any of you want to get in Air Force One with me and fly to Toronto, Berlin, Moscow,” he said, mistakenly saying “Moscow”.
“Well, even Moscow, probably. And bring your prescription with you, and I promise you, I’ll get it for you for 40 per cent the cost you’re paying now.”
He also went after “shrinkflation”, a term used to describe how companies make their products smaller but keep prices the same, and called on Congress to pass a bill that would end it.
“The snack companies think you won’t notice if they change the size of the bag and put a hell of a lot fewer … chips in it. No, I’m not joking,” he said.
He also turned his attention to taxes, which will be a hotly contested issue when Mr Trump's tax law expires in 2025. Mr Biden called for a higher corporate tax rate and promised a tax credit to assist homebuyers seeking a mortgage.
“Folks at home, does anybody really think the tax code is fair?” he asked.
Katie Britt, the US senator who delivered the Republican rebuttal to the State of the Union, gave her speech from inside her kitchen in an apparent attempt to underscore the “kitchen table” issues that voters face today.
“The American people are scraping by while the President proudly proclaims Bidenomics is working … We know better,” she said.
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Yadoo’s House Restaurant & Cafe
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Golden Dallah
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Al Mrzab Restaurant
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Al Derwaza
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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.”
Electric scooters: some rules to remember
- Riders must be 14-years-old or over
- Wear a protective helmet
- Park the electric scooter in designated parking lots (if any)
- Do not leave electric scooter in locations that obstruct traffic or pedestrians
- Solo riders only, no passengers allowed
- Do not drive outside designated lanes
Arabian Gulf League fixtures:
Friday:
- Emirates v Hatta, 5.15pm
- Al Wahda v Al Dhafra, 5.25pm
- Al Ain v Shabab Al Ahli Dubai, 8.15pm
Saturday:
- Dibba v Ajman, 5.15pm
- Sharjah v Al Wasl, 5.20pm
- Al Jazira v Al Nasr, 8.15pm
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