Saturday, April 16, 2005
5:30 pm - 8:30 pm
Chairman Mike Milken hosted a private reception and dinner at the Milken Institute for FasterCures / The Center for Accelerating Medical Solutions that included a lively and engaging discussion with two leading thinkers:

  • Ray Kurzweil, who spoke on, "Fantastic Voyage: How to Live Long Enough to Live Forever"
  • Juan Enriquez, who spoke on, "As the Future Catches You"

Greg Simon, President of FasterCures, gave additional remarks.

A reception was held from 5:30 to 6:30 p.m., followed by the dinner and presentations.

Speakers
Juan Enriquez, Chairman & CEO, Biotechonomy, LLC
Ray Kurzweil, Founder, Kurzweil Technologies; Inventor, Entrepreneur, Author and Futurist
Greg Simon, President, FasterCures / The Center for Accelerating Medical Solutions
Sunday, April 17, 2005
9:00 am - 10:00 am
10:00 am - 11:15 am
Halfway through the first decade of the 21st century, we find ourselves separated from the past by the revolutions in information technology, genomics and proteomics. This session begins our look at the future of our struggle to develop cures for deadly and debilitating diseases by asking the question: Where are we today in our ability to accelerate and deploy medical solutions? Panelists include Genome pioneer William Haseltine, founder of Human Genome Sciences and Chairman and CEO of Haseltine Associates; Leslie Mancuso, President of JHPIEGO and an authority on international health issues, including women′s and family health; Lee Hartwell, Nobel laureate and President of the Fred Hutchison Cancer Research Center, whose current interests involve developing early detection techniques for the treatment of cancer and other diseases; and Robert Klein, Chairman of the California Institute for Regenerative Medicine, which was established with the passage of Proposition 71, the California Stem Cell Research and Cures Initiative that he led.
Moderators
Greg Simon, President, FasterCures / The Center for Accelerating Medical Solutions
Speakers
Lee Hartwell, Nobel Laureate, Medicine, 2001; President and Director, Fred Hutchinson Cancer Research Center, Seattle
William Haseltine, President, Haseltine Associates, Ltd.; former CEO, Human Genome Sciences
Leslie Mancuso, President and CEO, JHPIEGO
11:25 am - 12:40 pm
Moving from where we are to where we need to be requires innovative, energetic leaders willing to risk failure. The traditional research infrastructure and funding system are not geared to such an effort. Only through new models of research and increased organizational efficiency can we reach the goal of faster cures. The presenters in this panel highlighted how they have changed the rules and the expectations in their respective research arenas and created novel partnerships for therapy development. In addition, they reflected on lessons learned that could help other disease groups. Panelists included Deborah Brooks, President and CEO of The Michael J. Fox Foundation for Parkinson′s Research, which under her leadership has funded nearly $50 million in research and related projects aimed at finding a cure; Kathy Giusti, President of the Multiple Myeloma Research Foundation, whose groundbreaking work in creating the Multiple Myeloma Research Consortium has been profiled in The Wall Street Journal; James Heywood, Founding Director of the ALS Therapy Development Foundation, whose innovative economic, business and scientific approaches to dealing with ALS have already modified the ALS drug discovery field and resulted in dozens of companies enlisting their resources in therapy development; and Warren Lammert, Co-founder of The Epilepsy Project, a nonprofit organization whose mission is to advance new treatments for epilepsy.
Moderators
Michael Milken, Chairman, Milken Institute; Chairman, Prostate Cancer Foundation; Chairman, FasterCures / The Center for Accelerating Medical Solutions
Speakers
Deborah Brooks, President & CEO, Michael J. Fox Foundation for Parkinson's Research
Kathy Giusti, President, Multiple Myeloma Research Foundation
James Heywood, d'Arbeloff Founding Director, ALS Therapy Development Foundation
Warren Lammert, Founder, The Epilepsy Project, Epilepsy.com
12:45 pm - 1:40 pm
1:45 pm - 3:00 pm
This panel of visionaries previewed the universe that will emerge from the convergence of informatics, genomics, proteomics and nanotechnology. From computer modeling of drug interactions to nanosensors detecting runaway cells to the discovery of new species with amazingly evolved adaptive traits, the future of discovery is approaching us faster than we can comprehend it. Fortunately, this distinguished panel, who arehelping bring it about, included Lee Hood, President of the Institute for Systems Biology and one of the world's leading scientists in biotechnology and genomics; Carol Kovac head of IBM Life Sciences and the visionary behind IBM′s information-based medicine program; Craig Venter, genome pioneer and discoverer and the Founder and President of the J. Craig Venter Institute and J. Craig Venter Science Foundation; and Anna Barker, Deputy Director of the National Cancer Institute for Strategic Scientific Initiatives, who spoke on the impact of integrating these new technologies into the field of cancer research.
Moderators
Greg Simon, President, FasterCures / The Center for Accelerating Medical Solutions
Speakers
Anna Barker, Deputy Director for Advanced Technologies and Strategic Partnerships, National Cancer Institute
Leroy Hood, President, Institute for Systems Biology
Carol Kovac, General Manager, Healthcare and Life Sciences, IBM
Craig Venter, President, J. Craig Venter Science Foundation; Founder, The Institute for Genomic Research
6:30 pm
Moderators
Patrick Mitchell, former Chief Investment Officer, California State Teachers' Retirement System (CalSTRS)
Lorraine Spurge, Managing Director, Post Advisory Group, LLC
Speakers
Kieran Beer, Executive Editor, Bloomberg Wealth Manager
Peter Early, Founder, CEO & Chief Investment Officer, Big Sky Capital
David Heber, Founder, Director, University of California, Los Angeles Center for Human Nutrition
Scott Klein, Managing Director , Investment Management, Post Advisory Group
Jim LaChance, Managing Director, Investment Management, Post Advisory Group LLC
Tom Livergood, CEO, The Family Wealth Alliance; President, Family Office Management, LLC
Oliver Marti, Managing Director/Portfolio Manager Healthcare, Columbus Circle Investors
Marc Primiani, Partner, Quintile Wealth Management
Michael Rosen, Co-chairman and CEO, Context Capital Management, LLC
James Rosenwald, III, Founder & Managing Partner, Dalton Investments, LLC
Monday, April 18, 2005
7:00 am - 8:00 am
8:00 am - 9:00 am
Financial incentives drive changes in health and medicine. That was one of the messages that came out of this roundtable on how to live longer and live better.

"I used to believe that good science made good medicine," said panelist Dean Ornish, "but I was nave." Changes in Medicare drive changes in medical practice. The decision by Medicare to allow reimbursement for diet and lifestyle changes is encouraging doctors to treat their patients accordingly, he said. Another financial factor driving change was injected by Mike Milken, who pointed out that government and the for-profit sector could no longer afford health care under the present system.

Mutual of Omaha and Blue Cross Blue Shield of PA found that they cut costs one-half and one-third respectively by teaching people to change their diet and lifestyle. The businesspeople in the room agreed that that was not only the right thing to do, but good business because it saved money - literally in the billions.

David Heber pointed out that prevention is the key. "Only 30 percent of how you age is determined by your genes," he said. "70 percent is in your own hands."

Specifically, Bruce Ames said there are 40 micronutrients, or trace minerals, that we must have to remain healthy, otherwise our cells release oxidants that "foul up" our biochemistry. Omega 3 fatty acids are also essential for brain function, he said. The problem among poor people is that they eat energy rich, calorie diets that are poor in micronutrients.

"What you include in your diet is as important as what you exclude," said Ornish. He found that three grams of fish oil per day substantially reduced the risk of heart attack and in a recent study on pomegranate juice, found that one cup per day also produced measurable results in improving heart health.

Susan Trimbo talked about the growing trend in supplement use among people with disposable income. The drivers behind the demand included aging, obesity and increased fitness trends. The 60-70 year old age group, she said, takes more dietary supplements than others. Among the most popular supplements were multivitamins, fish oil, calcium, and glucosamine and chondroitin. Educating women is critical, she said, because women drive changes in family health.

Another trend the panel noted was the globalization of illness as countries whose populations had historically good diets became more and more like the West. All agreed that efforts must be made to reverse that trend.

They was also a consensus among the panelists that proper diet and lifestyles would save billions of dollars by creating a healthier population. The difficulty was in getting the message out. Stuart Resnick, a producer of nuts and produce, noted that a decade ago, nuts were considered unhealthy. With the passage of time, they moved into neutral and now are known to be healthy. Dean Ornish is working with Steve Burd of Safeway, Inc. and other CEOs to drive a new message home to employees and to consumers about the benefits of eating nutrient rich foods and guiding them in their direction.

"Push the joy of living versus the fear of dying," Ornish said.

Carol Kovac of IBM agreed with the panelists, but pointed out the inherent complexity in the information itself and the ability of the consumer to sort it out. In response, Mike Milken suggested that CEOs bring scientists well-versed in nutrition into their companies and into the limelight to help spread the word.

"CEOs need to help scientists communicate," he said.

Speakers
David Heber, Founder, Director, University of California, Los Angeles Center for Human Nutrition
Dean Ornish, Founder and President, Preventive Medicine Research Institute; Clinical Professor of Medicine, University of California, San Francisco
Stuart Trager, Medical Director, Atkins Nutritionals, Inc.; Orthopedic Surgeon; Founder, ELITE Health & Wellness, Pennsylvania Hospital
Susan Trimbo, Senior Vice President, Scientific Affairs, GNC
8:00 am - 12:00 am
8:00 am - 9:00 am
With more than 7,000 hedge funds and nearly $1 trillion of assets under management, this industry, with its strategy of seeking high alpha, is no longer ignored by institutional investors or regulators. As these exponentially increasing sums of money flow into an industry where managers pursue increasingly diverse absolute return strategies, new questions arise: Will the money keep coming? How will these new cash flows be deployed? Must returns be diminished as a result of more money flowing into funds seeking alpha? Do high fees drag down performance? Which strategies are most popular and which have had the best returns (e.g. credit-based, equity-based, hybrid, global macro and private equity)? How do these funds perform on the basis of risk-adjusted returns compared to mutual funds and more traditional vehicles? How should managers optimize their portfolios to achieve high returns and minimize volatility? Is there too little good new talent to manage the increasing investments in hedge funds? Will we see too much capital chasing too few good deals? Does size matter (25 percent of hedge fund managers have $10 million or less under management), and how can you evaluate managers' ability to grow? How will likely regulation affect the industry and smaller managers in particular?

This private, invitation-only workshop was organized by the Post Advisory Group.

9:00 am - 10:15 am
This session examined the powerful affect of whole foods and supplements on human wellness and disease prevention, essential to a healthy, productive society. Indeed, the benefits of many foods cannot be reproduced by drugs at all.

Bruce Ames began the session by discussing nutrition as a factor in preventing all diseases. While fuel is the public′s typical understanding of the purpose of food, its micronutrient content is equally important. Indeed, micronutrients play a key role in a complex and nuanced mesh of biochemical pathways that keep the body healthy. Additionally, fatty acids such as good fish oils and flax seed oils are essential to the proper functioning of the body's systems.

Nutrition plays a major role in disease prevention. Conversely, poor nutrition can have destructive effects. Ames brought this into acute relief by asserting with compelling data that an unbalanced diet will soon surpass smoking as the dominant cause of cancer in the US. Not only is micronutrient under-nutrition rampant in Americans, it can have the same destructive effects as excess radiation, breaking down DNA in a person′s body.

The solution is inexpensive. Good food, coupled with multivitamin supplements "as added insurance," is a simple solution that′s widely accessible. The challenges are public education and behavior modification. Additionally, the US RDA should be re-examined, as it falls short of being able to predict an individual′s actual nutrient needs, Ames said.

Francine Kaufman spoke about "diabesity," a concept she developed to describe the epidemic of obesity and diabetes in both children and adults. Indeed, children today are developing Type 2 diabetes widely, a shocking fact considering that it has typically been only an adult-onset form of diabetes that can cause disability and death.

Can this epidemic can be prevented? Various treatments exist, and Kaufman showed that in studies involving control groups, moderate lifestyle changes proved more effective in preventing diabetes than medical insulin treatment. Kaufman went on to say that weight loss through reduced dietary fat, increased activity and reduced calories has a beneficial effect among diabetes patients. In addition, the right kinds of calories — high-fiber foods, fruits and vegetables, and moderate use of carbohydrates with low glycemic profiles — are key. School intervention can help protect children in particular from diabetic conditions.

Alexandra Logue spoke of motivation, and suggested that people′s taste preferences tend to lead them to the wrong kinds of foods. To counter this, one should first structure one′s environment to eliminate the availability of these foods. Secondly, individuals should try to make the delayed consequences of proper nutrition more immediate. Finally, role models are extremely important in encouraging healthy eating choices, especially for children and young adults.

Dean Ornish discussed the power of diet and lifestyle changes. He likened the ttraditional approach in Western medicine to mopping up the floor without turning off the faucet. In America especially, poor nutrition choices cause problems that the medical industry tries to solve without properly addressing the causes.

The body can heal itself, asserted Ornish. Move away from a high-fat, meat-based, toxic diet, and choose low-fat, plant-based, protective foods to feel the immediate healing effects. But excluding bad foods is not enough; the inclusion of powerful elements like omega-3 fatty acids is equally important. Three grams of this fish oil per day can help prevent cancer, reduce triglyceride incidence, and more. Even the progression of heart disease can be reversed by proper eating. An optimal diet involves good, unrefined carbohydrates, a diet based more on plant proteins than animal proteins and low consumption of saturated and trans fats.

The most effective way to get individuals, especially at-risk individuals, to make such changes is proper motivation. Recent heart-attack victims, for example, may change their eating habits for a short time, but quickly resort back to the same toxic habits as before if not properly motivated. In Ornish′s experience, fear and risk-awareness do little to make a person choose the right foods. Instead, people are most motivated by feeling better. The adoption of better habits is motivating in itself once people have seen and felt the lift from these improved behaviors. Enjoyment and short-term gains are motivating.

The cost-cutting benefits of comprehensive lifestyle changes are real. The $20 billion spent on statin drugs in 2004 could be avoided through behavioral intervention. Ornish cited several studies that have been conducted with national health-care entities and Medicare patients that showed impressive results - a 50 percent reduction in health-care costs in the first year, and 30 percent in subsequent years. These immediate benefits show that proper nutrition has immediate benefits to the individual as well as the health care system.

The group concluded that the public must move away from "the typical American diet." But how should they proceed?

Ames asserted that it′s a "no-brainer" and referred to a simple prescription of whole foods, vegetables, fish oil, vitamins, and fiber. He also recommended that action steps include education at all levels, and school system reforms as well as partnering with industry.

Ornish emphasized that the biggest advances in medicine are not necessarily high-tech; in fact, they are low-tech solutions found in proper nutrition. He added that changes to the medical reimbursement system will be essential to improvements, as will working with large food companies to encourage the production of healthier foods.

Logue asserted that the agriculture industry should make vegetables more tasty. Kaufman concluded that role models play a very important part in better eating among children. As such, healthier parents would have a vigorous effect on healthier children by example. The entertainment industry has also started to step up by making healthy eating "cool" to kids. Delivering messages to children in their lexicon can help them understand that their food choices have life-changing effects.

Moderators
David Heber, Founder, Director, University of California, Los Angeles Center for Human Nutrition
Speakers
Bruce Ames, Senior Scientist, Children's Hospital Oakland Research Institute
Francine Kaufman, Head, Endocrinology/Metabolism, Childrens Hospital Los Angeles
Alexandra Logue, Provost/Vice President for Academic Affairs, and Dean of the Graduate School, New York Institute of Technology
Dean Ornish, Founder and President, Preventive Medicine Research Institute; Clinical Professor of Medicine, University of California, San Francisco
9:00 am - 10:15 am
"We are at an inflection point," Leroy Hood said. "Biology and medicine will really be transformed." This transformation, he predicted, will come from the development of "systems biology," which will revolutionize how we identify and treat disease.

Systems biology is based upon the idea that one cannot understand any part of the body in isolation, no more than one can understand a car just by looking at its carburetor. Hood′s Institute sees the body as a series of networks that can be perturbed by the environment or microbes, altering the network. These alterations cause some proteins to seep into the blood, creating a fingerprint that be used to identify the diseases that are present and the networks affected. Thus, blood becomes a "window into health and disease," which will allow predictive, personalized medicine. Hood believes this revolutionary technology, which will also guide the development of new drugs to target specific networks, will be available in the next 10—15 years.

However, a number of challenges remain in developing new methods of interpreting the data, in funding the research, and in circumventing bureaucracies. Hood believes that a "whole new type of mathematics" will be necessary to analyze the protein fingerprints, as each measurement must be compared against all the other measurements.

Funding is difficult, as venture capital firms do not readily see strong profit potential in diagnostic technologies, and foundations tend to give only small amounts. Hood circumvented this difficulty by creating strategic partnerships, and by going to five different venture capital firms and requesting $10 million from each to form a startup fund.

Established bureaucracies, he insisted, have created problems by hampering the integration that is necessary for systems biology to advance. For instance, universities encourage young professors to work individually in order to earn tenure, and established departments prevent interdisciplinary research from taking place. In response, Hood opened the Institute for Systems Biology to escape such strictures.

After his presentation, Hood took questions from the audience. One person inquired as to whether health insurance companies would be the natural investors for a diagnostic technology. Hood indicated that in informal communications, he had found that most insurance companies simply did not understand the possibilities. He believed this was to their detriment as, "At any time of disruptive change, if you′re at the leading edge, you′ll win big."

Another audience member questioned whether these detailed tests will find a market, given that so many people don′t receive current tests for diabetes or prostate cancer due to lack of education. Hood responded, saying the problem was that the current tests are not very good. He believes that people will respond if they are shown that the tests work and actually lead to successful treatment. Hood pointed out that encouraging people to change their lifestyles doesn′t work; people are far more willing to take a pill. The current trial-and-error method of developing new drugs is both too expensive and ineffective; on the other hand, systems biology will allow targeted, personalized treatments.

In the course of answering other questions, Hood stated the FDA is not currently set up to approve integrated medicine, but systems biology′s high success would change that. In addition, he downplayed the usefulness of synthetic medicine in systems biology, as synthetic medicine concentrates on in vitro methods and theory, not the analysis of real networks. In response to the final question, Hood assured the audience that systems biology will be able to target stroke and heart disease, as well as cancer. In closing, Hood emphasized the revolutionary potential of systems biology and invited the audience to consider visiting, and perhaps partnering with, the Institute for Systems Biology.

Speakers
Leroy Hood, President, Institute for Systems Biology
10:30 am - 11:45 am
Should someone from Los Angeles take a vacation in Florida and wind up in the emergency room, the doctors treating him there should have access to his medical records in order to avoid potentially harmful drug interactions, allergic reactions and the exacerbation of pre-existing conditions. Unfortunately, as of right now, this is virtually impossible.

Anachronistically, personal medical records are almost entirely kept on paper; a person with four different doctors will have four different (and thus each one virtually incomplete) sets of paper-based medical records. This creates a breakdown in the effectiveness of physicians. In fact, Carol Diamond tells us that "100,000 [people] die in hospitals alone from medical error every year." This number could be decreased dramatically if there were a streamlined way for physicians to communicate with one another via the Internet.

What Kenneth Buetow, Carol Diamond, Kathi Hanna Carol Kovac, David Lawrence and moderator Greg Simon propose is, essentially, a comprehensive online database that would contain each patient′s medical records in its entirety. Were a system like this implemented, emergency room doctors treating the Californian in Florida would be able to know, within seconds, that he was allergic to penicillin and could proceed accordingly, thereby potentially lowering the risk of doctor error due to lack of information.

Another key component of a electronically based medical records system is that it would unite physicians with researchers. According to Ken Buetow, such a system would "build a seamless bridge between research enterprise and care delivery enterprise." With such a huge volume of data available to researchers through a nationalized electronic database of health records, the rate of curing fatal diseases could be vastly accelerated.

In addition, by giving patients practical access to a network that contains both their own personal health records and information about research, patients could personally search for clinical trials in which to participate, rather than depend upon a doctor and leaving their health and treatment in someone else′s hands entirely.

On the research end of the spectrum, a doctor who has seen two patients with a specific side effect from a drug like Vioxx might ignore his findings as flukes, but when connected with a nationalized database, he could see that other doctors across the country have seen similar effects in a handful of patients, as well. With no way for these physicians to exchange this information, a drug causing harmful side effects in people across the country might be allowed to stay on the market despite its dangers.

The proposed system is not without its flaws, though. According to both Carol Diamond and Carol Kovac, great incentives are needed to convince private practitioners with severely limited amounts of time and money to dedicate the sizable resources necessary to converting paper data to electronic data. In fact, resistance by physicians could, potentially, delay the conclusion of this project by 10 years.

Kathi Hanna also addressed two other issues that could pose problems for the project: the national trend toward protection of privacy and the tendency of academic and research institutions to be proprietary over data. Some patients might not want to have their personal medical matters available for viewing by strangers (even if those "strangers" are medical professionals). Also, institutions competing for funding might not want to grant other institutions access to information that has taken quite a bit of time and money to procure.

Ultimately, despite the drawbacks, implementing a nationalized electronic database of medical records and research data could revolutionize the prevention, treatment and perhaps eradication of diseases which, at this time, confound science. Describing the benefits of an electronic database devised by the Mayo Clinic, Carol Kovac noted that while it once took 3 months to gather information about a group of patients, now it "can be done in 30 seconds." The increased levels of communication, organization and data availability will have an enormously beneficial impact on health care and related research in America.

Moderators
Greg Simon, President, FasterCures / The Center for Accelerating Medical Solutions
Speakers
Kenneth Buetow, Director, National Cancer Institute Center for Bioinformatics (NCICB)
Carol Diamond, Managing Director, Markle Foundation's Healthcare Program
Kathi Hanna, Consultant, FasterCures
Carol Kovac, General Manager, Healthcare and Life Sciences, IBM
David Lawrence, Former Chairman & CEO, Kaiser Foundation Health Plan, Inc. and Kaiser Foundation Hospitals
11:15 am - 12:00 pm
12:00 pm - 2:00 pm
Recently, the IMF reported 2004 as the best year for worldwide economic growth in the past 30 years, with average GDP growth at a strong 5.1 percent. However, this growth was not evenly distributed: the United States, India and China were growth leaders while Western Europe and Japan trailed. This disproportionate growth prompted the panel, moderated by Paul Gigot, to discuss 2005′s predicted economic performance.

The panel unanimously agreed with Gary Becker′s assertion that 2004′s success was made possible by productivity growth. There are no indications of these growth trends diminishing thus, Becker suggested, that the leaders of 2004 would duplicate their performance in 2005. Though the panel agreed, Rupert Murdoch suggested that an unforeseen geopolitical conflict, possibly between China and Japan, could disrupt the world economy. He was otherwise optimistic about the world economic climate, including the increasing price of oil.

Panelists juxtaposed India and China′s economic growth with pessimistic views of the future of Western Europe. Interestingly, the emergence of post-Communist Eastern Europe has overshadowed past European economic leaders such as France and Germany, which are experiencing decreased productivity, exacerbated by the onset of a worldwide housing bubble.

The panel concluded with a discussion of terrorism and its economic impacts. All the panelists were optimistic about safety from the possibility of future attacks, which should lead to added economic security.

Moderators
Paul Gigot, Editorial Page Editor, The Wall Street Journal
Speakers
Gary Becker, Nobel Laureate, Economic Sciences, 1992; Professor, Economics and Sociology, University of Chicago; FasterCures Board Member
Wesley Clark, General (ret.), U.S. Army; former Commander, NATO
Rupert Murdoch, Chairman and CEO, News Corporation
Neal Soss, Managing Director & Chief Economist, Credit Suisse First Boston
2:15 pm - 3:40 pm
China, "the world′s hottest economy," as moderator Timothy Dattels opened, has captured world attention with its recent rapid climb to true global economic powerhouse status. China′s GDP grew at a blazing 9.5 percent in 2004, much more than any other major economy. What explains this strong growth and what are the effects, positive and negative, for China and the world?

Panelists discussed some of the key trends leading to China′s growth: rapid industrialization, accelerating urbanization, fast technology development and mass privatization. With China expected to pass the U.S. in real GDP by the middle of the century, understanding the implications of these trends now is important so that potential threats to world stability are addressed early.

Zachary Karabell pointed out that China′s growth was actually understated by these statistics since only about 200 million Chinese can be called "consumers" from an economic standpoint. Approximately 150 million people are still participating on the economic "fringe." When more of the approximately 800 million rural Chinese participate, growth could accelerate even faster.

With 50 percent of all cell phones and more than 70 percent of all DVD players manufactured in China, most people are familiar with China′s large share of global manufacturing. What people may not know are the residual effects on Chinese society. People are flooding into China′s bustling cities from traditional agricultural communities at staggering rates, causing poor living conditions and serious future environmental problems.

As the world′s second-largest consumer of oil and its largest consumer of steel, cement and many other metal commodities, China′s extremely low productivity and energy efficiency rates are of particular concern to panelist Perry Wong. China can produce at low costs today, but its low productivity comes at a high cost to the environment — with 15 of the world′s 20 most polluted cities that country.

Despite China′s growing pains, many investors like panelist Frank Sixt are bullish on its many business opportunities open to foreign investment. Hutchison downplayed the negative concerns raised regarding the lack of a free media, threat of government expropriation and limited IP protection, and he is confident that China will remain a great place to do business.

Some see familiar patterns from our own recent history. "A lot of rhetoric we hear about China now is similar to the rhetoric around Japan 20 years ago," said Shelly Singhal, who sees a lot of parallels in China′s growth with the rapid growth experienced by the U.S. from 1947 to 1960. Regardless, China is currently second in purchasing power only to the U.S. As it continues to grow and more essentially intertwined in world trade, its importance to the global economy will increase exponentially.

What is the biggest risk? According to Zachary Karabell, that there be no "hard landing" from China′s meteoric rise and that it not follow any of the patterns that economists and investors search for.

Moderators
Timothy Dattels, Managing Director, Newbridge Capital
Speakers
Zachary Karabell, Senior VP, Senior Economic Analyst, Co-Portfolio Manager, Fred Alger Management, Inc.
Shelly Singhal, Managing Director, SBI Group
Frank Sixt, Executive Director, Group Finance Director, Hutchison Whampoa Limited
Perry Wong, Senior Research Economist, Milken Institute
2:15 pm - 3:40 pm
Which is better able to adapt to the fast-changing needs of the modern world — a large pharmaceutical company or a small, nimble, niche-oriented company? The panelists tackled the challenges facing large and small pharmaceutical and biotechnology companies alike, and discussed how the different sectors are addressing these challenges, as well as the innovative business models that have emerged in the process.

Mel Sorenson pointed out that big companies have the human capital and resources, the branding, marketing and legal expertise, and the distribution network highly needed to successfully bring a product to market. However, small companies, given their size and with proper focus, are able to make quick decisions, and hence tend to be the source of new products in the market. On the other hand, Gillies O′Bryan-Tear countered that small companies may lack development and organizational skills, be unable to sufficiently diversify risks and have a tendency to divert valuable time to raising funds.

"The parallels are tremendous for big companies and smaller companies," said Frank Armstrong. Smaller companies, he said, may be paralyzed by an inability to make the simplest decisions because of the impact on the company. While the overhead being incurred by big pharma is mostly related to maintaining products in the market and monitoring risk-benefit. "The models are very, very different, [but] both have different things to offer."

According to Howard Soule, while significant strides have been made in the biopharmaceutical space over the years, the industry faces significant pressures that affect the innovation pipeline. These pressures relate to the decreased capital market valuation of the big pharmaceutical companies, the changing role of academia in the process of innovation, the impact of emerging biotech companies, the consolidation in the industry and problems getting funds and capital.

"It′s tough right now, if you take away the top 10 companies after the crash, the market which was $163 billion in 2000 shrunk to $101 billion in 2003," said Dennis Purcell. He said that investment companies like his are under pressure from investors looking for returns early, given that the cost of failure in the venture community is very high. "In private equity, there is a lot of capital, they just haven′t seen the returns," he added.

Edward Holmes said that academia faces challenges as the process of innovation is laborious, time-intensive and expensive. Certain technologies facilitating discovery research, chemistry and manufacturing might address some of the challenges. Also, more gains are seen from partnerships with the private sector. USD Connect at the University of San Diego is an example of such a partnership that helps improve the process, said Holmes. Small companies, like Ascenta Therapeutics, Inc., are able to take advantage of partnerships with universities on R&D and focus on very complex decisions in the value chain.

An innovative business model might further push dynamic change in the industry. Bioaccelerate, a drug development company, might just be an agent of change. "We concentrate on early stage development where we can build volume in a very specific way," Armstrong said. "We build therapeutic companies, bundle a group or series of products into the therapeutic companies — products that have a diversity of mechanism and chemical profiles, [create] a development plan for these products, provide initial funding, take the company public, increase the value in this company, and refund the company through public money," he explained. Noting that the only company in this area to show sustainable growth is Johnson & Johnson with its diversified profile, Armstrong said that there is significant value in "working with key stakeholders in the pharma innovation chain." That is why, he added, that his company works with academia, small companies, big pharma and Wall Street.

Moderators
Howard Soule, Senior Fellow, Milken Institute; Managing Director, Knowledge Universe Health and Wellness, LLC
Speakers
Edward Holmes, Vice Chancellor for Health Sciences, Dean, School of Medicine, University of California, San Diego
Gillies O’Bryan-Tear, Consultant; former Vice President, Global Clinical R&D, GlaxoSmithKline Biologicals
Dennis Purcell, Senior Managing Director, Perseus-Soros BioPharmaceutical Fund, L.P.
Mel Sorensen, President and CEO, Ascenta Therapeutics, Inc.
2:15 pm - 3:40 pm
Africa′s economic position has never been better for investment. With new corporate governance controls and increased transparency, Africa is preparing itself for continued economic growth. Historically, Africa has relied on natural resources for its economic prosperity. However, more value-added businesses are coming to market in countries such as South Africa and Ghana.

Leading Africa′s economic prospects is China. As Walter Kansteiner said, the "rise in China′s investing (in Africa) is the greatest single factor at the moment." Trade with China in 1990 was $800m, and this figure rose to $20b in 2004. China currently imports 25 percent of its oil from Africa, and its partnership with Africa is predicted to grow. Africa′s historical reliance on Europe and the U.S. is slowly changing to include more areas of the world.

When investing in Africa, it is important to go in with a partner. Kofi Appenteng indicated there are already strong business networks in place to help navigate the markets. Political risk is still high in Africa. However, as Kansteiner reinforced, "risk can be mitigated with local partners."

The HIV/Aids epidemic is remains a major concern. However, Michael Power says "the continent is over the worst of it." African nations are giving the issue the attention it deservers, and developing real solutions. Long term, the impact of the disease still looms with many teachers succumbing to the virus.

Moderators
Harold Doley, Jr., Founder, President, CEO, Doley Securities, Inc.
Speakers
Kofi Appenteng, Partner, Thacher Proffitt & Wood, LLP
Walter Kansteiner, III, Principal, Scowcroft Group; former Assistant Secretary of State for African Affairs
Ndi Okereke Onyiuke, Director General and CEO, Nigerian Stock Exchange
Michael Power, Strategist, Investec Asset Management
Athol Williams, Managing Director, Taurus Associates and Taurus Capital
2:15 pm - 3:40 pm
A group led by Mike Svinte of IBM′s information-based medicine unit, facilitated a roundtable discussion that debated whether a personalized approach to processing and disseminating medical information was feasible or just a distant dream. He sees these information systems as being able to "bridge the world of research and the world of clinical care," such that patients can receive tailored and detailed information that pertains directly to them.

By transforming research and clinical information into an actionable body of knowledge, treatments can be mass customized. Data would be interpreted to give specific prescriptions to individuals, rather than treating them as statistics, and thus would be more effective in changing patient behavior. "If you tell someone they′re four times as likely to die from cancer than the average man, they′re less likely to smoke, than if you simply say smoking kills," emphasized Svinte.

At the heart of such an information system would be electronic medical records that digitally follow each patient. But, these dreams are met by a reality that relies on outdated business models, lagging information technology systems in hospitals, and low levels of doctor cooperation with new initiatives. The burden of change ultimately falls not on the patient, but rather the people that pay — the corporations. Health-care providers must partner with corporations to drive reforms that ultimately allow doctors to treat patients more effectively with lower cost.

The group′s focus shifted to the health-care industry as a whole, speculating about what it would look like in 10 years. Most were critical of the industry′s compartmentalization and favored a revised model that views health care as an ecosystem, in which all the stakeholders interact dynamically to share information and ideas. The flow and processing of information will prove critical in the future to tailoring health care to meet individual patient needs, which ultimately means better patient care.

Moderators
Michael Svinte, Vice President, Information Based Medicine, IBM Healthcare and Life Sciences
2:15 pm - 3:40 pm
Women are the primary caretakers of the world′s society. They are the gateway to family, community and individual health. If societies could truly support women in putting their health first, they could potentially raise the bar for all of society leading to increased productivity and GDP growth as well as increased quality of life. The reality is that today we may be moving in the opposite direction. Global issues such as AIDS, heart disease, and poor nutrition are among a few of the leading issues impacting women′s health and the economy. A panel of experts from LLuminari, a network of experts who have come together to illuminate the health issues of the 21st century and inspire people to live healthier lives, discussed these issues from a multi-disciplinary perspective.
Speakers
Elizabeth Browning, Co-founder and CEO, LLuminari, Inc.
Susan Love, President & Medical Director, Dr. Susan Love Research Foundation; Co-founder, Lluminari
Michael Roizen, Professor of Anesthesiology, Professor of Internal Medicine, SUNY Upstate Medical School; Chair, Scientific Advisory Board, RealAge Inc.
2:15 pm - 4:40 pm
As the partisan food fights in Washington continue, Matt Miller — Fortune columnist, public radio host and author of The 2% Solution: Fixing America′s Problems In Ways Liberals And Conservatives Can Love — argued that for two cents on the national dollar we can insure the 44 million uninsured, subsidize a living minimum wage of $9 to $10 an hour, make the best teachers of poor children millionaires over their careers, and more. He also said we can reach these "liberal" goals through "conservative" means — and when the dust clears government would be smaller than it was when Ronald Reagan was president. Too good to be true — or just what America needs?
Speakers
Matt Miller, Author, Columnist, Radio Host & Consultant
2:15 pm - 3:40 pm
Funds specializing in alternative investment strategies, or hedge funds, have experienced spectacular growth over the last 15 years. Total assets managed have grown from $50 billion in 1990 to $1 trillion today. Experts on the panel agreed that the industry is here to stay, and there is no such thing as a hedge fund bubble, or unsustainable growth of the business.

"Growth of the industry has been the natural counterpart of a tremendous increase in asset classes and investment possibilities," said Gregory Sachs. Growth certainly came with greater heterogeneity in the business. "I don′t know if there is a definition of hedge fund anymore," Sachs said.

"The industry is now attending to many more different needs," said Joseph Feshbach. This diversity is also a source of resilience. Panelists agreed that there could be no possible collapse of the industry; with so many different strategies, all funds could not dramatically fall at the same time.

However, the road ahead is not without its challenges. Scott Klein emphasized the future need of an increase in the number of people with talent and the risk of over-regulation. Mitchell Julis focused on maintaining an adequate balance between the patience of the investor in bad times and the performance of the fund.

Despite this radical change in size and structure, the industry has maintained its edge in outperforming the market measured by average indexes like the S&P 500. The bigger the funds become, the harder it is to concentrate on the competitive advantage, panelists said. Competition is also becoming an ever-increasing and permanent challenge to existing funds. "Staying competitive in managing real assets is very hard, but more so in managing financial assets where strategies are more easily replicable," said Julis.

However, they all underscored the importance of maturity and experience in the business, as well as the notion of undertaking asset management as a business, as opposed to an idea, referring to the drawbacks of smaller-sized funds in the industry. Success in the industry draws on good management, controls, transparency, and the soundness of the organization in general, they agreed.

Panelists placed heavy emphasis on the treatment of risk. Scott Klein referred to "a permanent focus on what can go wrong." Sachs stressed taking an integral approach to risk, not one-dimensional measures, like leverage. Julis emphasized communication with clients to avoid redemptions during bad times. If that is achieved, volatility should not be tied with risk, they argued.

In today′s financial market, where volatility is much lower, arbitrage opportunities are almost impossible to find. The business of alternative investment strategies seems to be set on a path of unstoppable growth. Panelists seem confident financial ingenuity will keep pace with the amount of funds coming into the industry.

Moderators
Joel Kurtzman, Senior Fellow, Milken Institute; Principal, Kurtzman Group
Speakers
Joseph Feshbach, Founder, Managing Member, Joe Feshbach Partners, LLC
Mitchell Julis, Founding Partner, Canyon Capital Advisors, LLC
Scott Klein, Managing Director , Investment Management, Post Advisory Group
Gregory Sachs, Chairman & CEO, Deerfield Capital Management LLC
2:15 pm - 3:40 pm
Steve Case joined Michael Milken to discuss the strategies they used to leverage their philanthropic giving to generate greater results in prostate cancer and brain cancer.

Milken began the presentation with an overview of charitable giving in the United States which currently amounts to $40 billion, 74 percent of which is from individuals. He stressed that baby boomers possess $1.1 trillion in spending power, which they are willing to spend on both their parents and children. Milken commented, "We believe this generation′s legacy to future generations is the elimination of debilitating disease."

Case related how he became involved in brain cancer after his brother developed a tumor. Finding that brain research was conducted in highly specialized silos, he founded ABC^2, Accelerate Brain Cancer Cure, to "blur and blend the lines between business and philanthropy." He eventually expanded his efforts to consider other brain diseases through the Brain Trust, as they faced common challenges. Recognizing biotech firms′ hesitation to invest in diseases with relatively small markets, Case partnered with Genentech by taking over the initial financial risk. Through his efforts, there are now six times as many brain cancer therapies in clinical trials. Similarly, Case created an entrepreneurial model by providing venture capital to companies with brain disease research. Although he admitted that "the core principles of coordination and entrepreneurship are easier to say than to put in practice," he emphasized that doing well and doing good can be combined by investing in companies that will advance the research.

Milken and Case then responded to audience questions. One individual was concerned that charities could not invest or get royalties under current IRS policy. Case acknowledged the problem, explaining that he uses separate organizations to do the investing. However, he felt that both the private and public sector would benefit from a greater blurring of the lines between the two to allow greater crossover of talent. He pointed out that National Geographic had become extremely successful by doing just that. Milken concurred, stating that such limiting laws needed revision. His organization, FasterCures, works to improve the infrastructure of research to speed development.

Another audience member asked whether recruiting talent and starting a new research organization would be a more effective way of getting results. Milken explained that he received a better return on grants to young researchers than to researchers at the peak of their careers. When asked how one can create a greater profile for a given disease, Milken advised that a disease′s publicity often depends on the comfort of its sufferers in appearing in public; he also suggested using the Internet as an outreach tool. Case suggested aligning with other organizations with similar agendas. The final questioner asked how to leverage small amounts of money. Milken stressed that human capital, the passion to fight for the cause over the course of years, is more important than money. Case suggested investing in people you believe in. Both speakers encouraged the audience to use entrepreneurial models in pursuit of charitable aims.

Speakers
Steve Case, Chairman, Case Foundation; Co-founder, former Chairman and CEO, America Online, Inc. and AOL Time Warner
Michael Milken, Chairman, Milken Institute; Chairman, Prostate Cancer Foundation; Chairman, FasterCures / The Center for Accelerating Medical Solutions
3:50 pm - 5:15 pm
How do you motivate children who grew up with wealth? Should you give them money or not? How much? Does wealth decrease their incentive? What affect does wealth have on children? What is the proper balance of transferring wealth between generations? If you do give them money, how do you do it in a way that makes it more likely the inheritance will survive through future generations? Is there a way to understand the implications of the choices of wealth transfer for you and your family? What money messages do our children inherit from us? How can we raise children who are thoughtful about money and its meaning? This session focued on best practices for wealth transfer between generations.
3:50 pm - 5:15 pm
Publicity about family matters and a family business, while sometimes helpful, can be a distraction and often a liability. A dialogue with a reporter follows rules -- understood by professionals and seemingly mysterious to laymen -- nearly as formal as those observed by lawyers in a courtroom. The result is seldom what the untrained spokesperson expects. This session explored when you need professional assistance before talking to a newspaper, magazine or TV reporter and how you can be prepared when you get requests for interviews. A long-range media plan should be part of your strategic family office planning.
3:50 pm - 5:15 pm
Common sense tells us that consistently higher rates of return will lead to higher total ending value for any investment. The extent of that impact, however, is not always well understood. Andrew Rosenfield opened the discussion by citing the example of Peter Minuet′s purchase of the island of Manhattan 400 years ago for $24. The value of that investment at a compounded rate of return of 8 percent would be $4 trillion today; however, at a 3 percent annual return the current value would be only $1.5 million. When families start to consider wealth management across generations, rates of return become vastly more significant.

Over the last 20 years, investment managers have been able to achieve remarkable rates of return, with a typical 60 percent equity / 40 percent bond fund returning almost 12 percent annually. However, consensus estimates put the predicted next 10-year annual return for a similar portfolio at 6.2 percent. According to Michael Christ, after factoring in fees, taxes and spending, investment managers will have difficulty even achieving this level of return. Plus, the downside risk will be heightened as wrong decisions by managers have greater salience in a lower-return environment. How realistic is this consensus predicted return? Gary Becker noted that historical return on equities has closely approximated the historical after-tax return on capital of roughly 7 percent per year, the same number used in Mr. Christ′s summary of blended return predictions. In other words, the future for investment managers seems to involve more work for lower total returns.

It′s in this context that the value of human capital for investment management is becoming increasingly recognized and rewarded. Some hedge funds seemingly defy the efficient capital markets theory by earning consistently higher rates of return at lower risk than should be possible under the widely accepted capital asset pricing model. According to Mr. Rosenfield, "hedge funds do not define an asset class, but a form of compensation" for the most talented investors. In fact, returns to talent in many industries and functions have been increasing in the last 25 years, as an increasingly knowledge-based economy offers greater premiums for human capital. Mr. Becker, who coined the term "human capital," estimates that 70 percent of all capital in a modern economy is human capital, and the increasing returns to human capital are a reflection of its significance.

The modern economy may have only recently started to offer such outsized returns to talent, but the Guggenheim family has been recognizing and rewarding talent for generations. Peter Lawson-Johnston II offered a succinct summary on his family′s view on the importance of human capital: "If you have an opportunity that you want to succeed in, identify the best person or team for that endeavor and challenge that person or team to reach a higher standard in whatever that endeavor is."

Robert Gertner expanded the conversation to include a discussion of risk, and particularly the investment manager′s inability to perceive his/her client′s desired risk-reward tradeoff. For several reasons, analyzing a client′s desired level of risk is difficult because the frame of reference often colors the decision. People are more likely to employ higher-risk behavior when seeking to avoid losses than when seeking to achieve gains, and in response to subtle cues the investment manager provides regarding desired risk-reward tradeoffs. Investment managers must be careful to look beyond the investment portfolio and truly understand their clients′ goals with respect to risk-reward decisions.

Moderators
Andrew Rosenfield, Managing Partner, Guggenheim Partners
Speakers
Gary Becker, Nobel Laureate, Economic Sciences, 1992; Professor, Economics and Sociology, University of Chicago; FasterCures Board Member
Michael Christ, Managing Director, Asset Consulting Group, Inc.
Robert Gertner, Wallace W. Booth Professor of Economics and Strategy, University of Chicago Graduate School of Business
Peter Lawson-Johnston, II, Managing Partner, Guggenheim Partners
3:50 pm - 5:15 pm
Economist Paul A. London, who served as deputy under secretary of commerce for economics and statistics in the Clinton administration, talked about his new book, The Competition Solution: The Bipartisan Secret Behind American Prosperity, and engaged the audience in a roundtable discussion. London argued that prosperity in the 1990s was the result of political struggles over several decades that opened up markets and increased competition within them, rather than the changes in monetary or tax policy that most economists focus on. Competition, not the Federal Reserve, ended inflation by making it impossible for businesses to raise prices; competition, not tax cuts, spurred investment by forcing companies to make investments that enabled them to cut costs and expand. He argued that future prosperity will depend less on tax cuts and monetary policy than on having the political courage to maintain competition where it is strong and expand it in industries with still-rising costs, such as health care and education.
Speakers
Paul London, President, Paul A. London and Associates; former Deputy Under Secretary of Commerce
3:50 pm - 5:15 pm
If you could create the perfect regulatory body from scratch, what would it look like? Clifton Leaf kicked off the panelists with this engaging and provocative question.

Paul Antony addressed the issue from two perspectives. First from the point of view of an individual physician, he, said, an ideal FDA would provide information on how a medicine would work in each individual patient. Currently, the FDA provides general information about a drug′s side effects, safety profile and performance in a small group, but falls short of adequately predicting a drug′s performance in an individual. Secondly, from the agency′s standpoint, he′d like to see the FDA make decisions based on science, not headlines. Instead of simply reacting to the press, the ideal FDA would seek scientific corroboration first. Also, the ideal FDA should educate people about the risks associated with any medicine and conduct more post-marketing surveillance about a drug′s performance.

John Nelson narrowed down the ideal role of the FDA to a few key points. The FDA should make sure that drugs are effective, safe, affordable, available and user-friendly to promote patient compliance.

Una Ryan stated the FDA is not broken. In reality, our expectations of it are wrong. The FDA cannot guarantee that a drug will be 100% safe and 100% effective, and the public should temper these expectations. Instead, patients should assume some responsibility for evaluating the risks vs. the benefits of drugs. She proposed that a two-chip mechanism could help evaluate a drug against the unique makeup of each person. The characteristics of each drug would be compared to each patient′s individual makeup, including pharmacogenomic information.

Daniel Troy saw various scenarios for an ideal FDA. Currently, he sees that over-regulation by trial lawyers and state attorneys harms drug innovation and drug availability. Tort reform is necessary to improving the FDA. He also noted that drugs should not be evaluated on safety alone; the risk of the drug should be compared to the risk of not taking a drug to see which presents the riskier option. In the field of vaccines, Ryan noted that over-regulation keeps competition out of a field that is dominated by a few key players. While the cost of developing the vaccine itself is "pennies," the tests are costly and time-consuming. Not only does this drive up the cost of the drugs, it also slows the drug′s speed to market. In some situations, this lag time will kill more people than a drug′s statistical mortality risk.

S. Ward Cascells noted that the FDA has had a difficult year. Vioxx-related deaths and teen suicide from anti-psychotic drugs were in the spotlight. The FDA has been criticized, demoralized and discouraged. The agency needs strong leadership, a thoughtful effort towards improvement, and increased budget. Compared to other agencies, such as the Department of Agriculture for example, the FDA′s budget is modest at best.

"More information, less regulation" was a dominant theme among the panelists. For example, Troy noted that information about off-label drugs (i.e. not FDA-approved) should not be prevented or criminalized in the health-care industry. Currently, drug companies are not permitted to share substantiated peer review data with doctors. Leaf chimed in, stating that pharmaceutical companies, the FDA, doctors and patients must all become better at sharing information. The panelists agreed that patients must become better educated. Education will help patients understand that the risks of a particular drug may be lower than not using the drug at all.

On the issue of the impact of free markets on the pharmaceutical industry, Antony believed that competition creates better drug products. He used the government′s Anthrax vaccine as an example. While Nelson agreed with the free market approach and that competition is important, he noted that the enemy of the drug companies should not be other drug companies — it should be disease.

The panel was also in agreement that as consumers, they′re tired of direct-to-consumer advertising, Still, Troy pointed out that DTC advertising has led to increased treatment of depression, cholesterol problems and osteoporosis, conditions that have traditionally gone undiagnosed.

The overall consensus was that the FDA is a relevant entity, but one that needs improvement. "We absolutely need the FDA," said Ryan, but we shouldn′t let the regulatory process drive up costs or delay the time from drug discovery to meeting the patient. Troy noted that the use of drugs lowers the overall cost of health care. Their use and development is an important part of cost-effective health care. Casscells stated that to continue to be relevant, the FDA is tasked with a leadership challenge — that of remotivating the agency and improving its accountability and transparency. The FDA must continue to innovate and change. Casscell′s message to patients is one of responsibility: caveat emptor.

Moderators
Clifton Leaf, Executive Editor, Fortune Magazine
Speakers
Paul Antony, Chief Medical Officer, Pharmaceutical Research and Manufacturers of America (PhRMA)
S. Ward Casscells, John Edward Tyson Distinguished Professor of Medicine (Cardiology) and Public Health; Vice President for Biotechnology, The University of Texas Health Science Center at Houston
John Nelson, President, American Medical Association
Una Ryan, President and CEO, AVANT Immunotherapeutics, Inc.
Daniel Troy, Partner, Life Sciences Practice & Appellate Litigation Group, Sidley Austin Brown & Wood LLP; former Counsel, FDA
3:50 pm - 5:15 pm
Emerging markets represent tremendous opportunities for institutional investors. Emerging markets — rapidly growing ethnic minority communities in the United States, and the billions of low-income people around the world — are the "diamonds in the rough" that the experts on this panel recognize as opportunities and translate into valuable and attractive products for the investment community. Panelists debunked myths surrounding investment in low-income, emerging markets by citing high return rates and recent trends by institutional investors.

Panelists discussed specific methods for attracting institutional investors. David Sand, offers bond market level returns to demonstrate to institutional investors that emerging market investments can fit "comfortably within asset allocations." Sand and Shari Berenbach both emphasized financial engineering to generate return on investment as well as a social impact. Sand pointed out the need to both "speak the financial language," as well as spread the word to the investment community, since many are afraid of being the only investors on board.

There is a silver lining, as certain investors may be willing to forgo some economic return in exchange for some quantifiable social improvement. However, according to Leslie Kautz, institutions are often slow with decisions. Institutional investors also need to decide how to classify these investments to increase public awareness. Institutional investors require detailed reporting and daily pricing from companies before they are willing to invest. Berenbach noted that increasing the number of products, or the supply of instruments for investors, will increase interest among the institutional investment community.

International investors face additional risks. According to Gil Crawford, "many didn′t believe it was possible to lend to the poor in emerging markets." Volatile exchange markets make international investing increasingly risky. Peter Johnson cited promising trends in institutional investment that allow for the scaling back of using government money to invest in international microfinance institutions. Johnson explained that microfinance institutions are less risky than commercial banks because they serve such a high number of clients. MicroVest and Calvert both operate without any government support, which should lead to more scalable operations in the future.

At the end of the discussion, Crawford warned, "You can′t redline five billion people for very long." Indeed, financing low-income, emerging markets will bring needed capital to new entrepreneurs around the world. According to the panelists, there are certain challenges to widespread investment in emerging markets. Despite these challenges, panelists were optimistic that both investors and entrepreneurs would see increasing opportunities for mutually beneficial relationships in the near future. And this time, society will also reap rewards.

Moderators
Betsy Zeidman, Director, Milken Institute Center for Emerging Domestic Markets
Speakers
Shari Berenbach, Executive Director, Calvert Social Investment Foundation
Gil Crawford, General Manager, MicroVest Capital Management
Peter Johnson, Partner, Developing World Markets
Leslie Kautz, Founder and Principal, Angeles Investment Advisors, LLC
David Sand, President and CEO, Access Capital Strategies LLC
3:50 pm - 5:15 pm
Following an introduction by Michael Milken, the panelists discussed the evolving nature of American health care, and their efforts as corporate leaders to curb the 10—12 percent yearly increase in costs. All agreed that health care was a necessity; the issues discussed sprung from efforts to minimize its costs.

Milken pointed out that 70 percent of health costs were attributable to lifestyle-related disorders. Further, 25 percent of total costs were waste-related due to either over- or underuse of the health-care system. The four CEOs on the panel, though each from a different background, agreed that these costs presented a problem for nearly all large-scale American businesses.

Interestingly, the theme of the solutions offered — lifestyle change — was advocated independently by Milken. Jonathan Miller and Steven Burd stated that their implementation of lifestyle-change incentives led to increased employee health and decreased wasted health-care costs. Bruce Bodaken suggested that a more effective and accessible diagnosis process would lead to decreases in absentee employees, as well as those who come to work while ill and are unproductive.

The panelists agreed that these alternatives to waste required a complex infrastructure designed to manage data and information traffic. Though initially a burden on providers, this would simplify the health-care process for employees, resulting in increased efficiency and more effective care. Other alternatives included home and hospice care being implemented to replace costly and ineffective hospital stays for terminal patients. These options would decrease costs, but not compromise the quality of care.

Hospitals often treat patients before discussing payment options; thus, the insured pay for the uninsured. The panelists agreed that this makes insurance a benefit for an employer as well as the employee, since health care has established itself as a permanent part of the American workplace.

Moderators
Michael Thompson, Principal, PricewaterhouseCoopers LLP
Speakers
Bruce Bodaken, Chairman, President & CEO, Blue Shield of California
Steven Burd, Chairman, President and CEO, Safeway Inc.
Jonathan Miller, Chairman and CEO, America Online, Inc.
Pete Petit, Chairman of the Board and CEO, Matria Healthcare, Inc.
5:15 pm - 6:15 pm
5:15 pm - 6:15 pm
6:30 pm - 8:30 pm
How will going to the doctor 20 years from now differ from today′s patient experience? For one thing, you won′t go to the doctor as often as your data, because remote sensors will report in every day to your doctor′s digital database. When something appears abnormal, the database will alert your doctor in a daily report or, in an emergency, page her instantly. By 2025, the processing power and storage capacity of a single computer will have long since exceeded that of the human brain, leading to the first steps in "The Singularity," the merging of humans and machines. Advances in genomics and proteomics will have produced cures for many genetically based diseases.

This after-dinner plenary session, moderated by Institute Chairman Mike Milken, featured three brilliant panelists, each acknowledged to be the leading authority in his field: Craig Venter, who headed the first successful effort to decode the human genome; Ray Kurzweil, futurist, computer scientist, inventor, entrepreneur and author of the forthcoming "The Singularity is Near"; and David Brailer, recently named by Modern Healthcare Magazine "the most-powerful person in healthcare," whom President Bush appointed last year as National Health Information Technology Coordinator.

Moderators
Michael Milken, Chairman, Milken Institute; Chairman, Prostate Cancer Foundation; Chairman, FasterCures / The Center for Accelerating Medical Solutions
Speakers
David Brailer, National Coordinator for Health Information Technology, Department of Health and Human Services
Ray Kurzweil, Founder, Kurzweil Technologies; Inventor, Entrepreneur, Author and Futurist
Craig Venter, President, J. Craig Venter Science Foundation; Founder, The Institute for Genomic Research
Tuesday, April 19, 2005
6:30 am - 9:00 am
6:45 am - 7:45 am
This invitation-only session addressed the threat from infectious disease and why it is a global problem. Participants offered suggestions on how to address the challenge with the discussion covering the threats from a range of perspectives: health, environmental, economic and political. Examples were used from recent cases such as SARS, bird flu and others. The session included a summary from a recent World Health Organization report and relevant findings on the subject. Some of the questions addressed included: Will sufficient investments have been made ahead of the curve? Will there be sufficient cooperation between the parties that could make a difference? Can the research industry find the products and carry out the development? Will NGOs and governments give sufficient support, commercial direction and assistance? Will medical agencies give clear guidelines as to fast-track approaches so that efforts are not bogged down in large-scale repetitive studies? Technology is part of the solution, but will the tools be there when we need them?

6:45 am - 7:45 am
The Milken Institute has been tapped by government, the financial services industry and the financial media to identify and quantify sources of global country risk to support better business and public policy risk management decisions. Institute scholars have created risk-analysis tools relevant to expanding capital markets and international portfolio management. Their work has gone considerably beyond conventional "value at risk" estimates on potential portfolio loss due to an adverse event in normal markets. They've developed tools that capture both low-risk, high-cost events and everyday risks of global portfolio management. At this roundtable, researchers presented three unique and proven methodologies — for estimating the likelihood of a banking crisis, monitoring country financial reform and measuring opacity risks in areas like a country′s legal institutions, accounting and regulatory transparency in financial reporting.
Moderators
Glenn Yago, Director, Capital Studies, Milken Institute
6:45 am - 7:45 am
Each year, employers are faced with double-digit increases in their health-care premiums to provide quality health benefits for their employees. To combat this trend, human resource professionals are supplementing their benefit packages with programs designed to improve the quality of life of their employees while reducing health-care costs. These employer-sponsored programs assist people who are at risk to develop, or have been clinically diagnosed with, a chronic condition by providing them with disease-management and health and wellness programs. These programs improve the health and productivity of employees while generating significant returns on investment. This roundtable discussion provided an overview of the design and implementation of these programs and the clinical and financial performance indicators used to measure their effectiveness.
Speakers
Martin Olson, Corporate Vice President, Business and Clinical Informatics, Matria Healthcare, Inc.
6:45 am - 7:45 am
7:50 am - 9:20 am
People are motivated by different incentives and risks, but the concepts of risk and expected return on investments are hard for many people to understand. Recent advances in economics and psychology have given us powerful new insight into the investigation and expression of these preferences, which allows money managers to structure portfolios based on these different risk tolerances. How do individuals and families understand and define attitudes toward risk? Can the tools of simulation, visualization and evaluation of maximum tolerable loss help create a matrix to determine a family′s true risk levels? Can evaluation of tolerable "regret" or the creation of multiple mental "accounts" at the family level help separate the "stay rich" and "get rich" goals?
7:50 am - 9:20 am
In this roundtable, Gerald Parsky, a partner at Aurora Capital Group, former assistant secretary of the Treasury, and chairman of the Regents of the University of California, discussed how to create value in a market where so much capital is seeking a home.
Speakers
Gerald Parsky, Partner, Aurora Capital Group
7:50 am - 9:20 am
Experts discussed the "three legs" of the retirement system: social security, employer pensions and personal savings. Although all agreed that there were problems with all three legs, they differed on the solutions, particularly as to social security.

Senator John Breaux summed up the social security problem. "The good news is that people are living a lot longer; the bad news is that people are living a lot longer." All of the speakers agreed that increasing life expectancy has decreased the number of workers supporting each retiree, creating problems in the system.

"We haven′t set aside enough resources for our obligations," explained Bradley Belt. Peter Orszag added that social security is also regressive, as low-income people have shorter lives than high-income people, and incomes above $90,000 are exempt.

Moreover, the panelists agreed that it was not an immediate crisis. Orszag particularly felt that the crisis terminology was an attempt to drive political action, but the public sees through the ploy. He further stated that only "jittery" foreign creditors creating a fiscal crisis would bring social security to a crisis point in the near future. Breaux, however, warned against delays that would make future changes more draconian.

Despite the agreement as to what the problem is, the panelists differed as to how the system should be changed. Steve Westly felt that moderate changes would be sufficient and warned against policies proposed to create an "ownership society." Belt, however, wants "to move to a system where people own assets." Although Westly declared that the average person does far worse at investing than professionals, Belt countered that the citizen could put the money in a conservative account. Breaux related that as a Senator, he simply checked the risk level he wished to pursue and the Federal Thrift Saving Program did the actual investing for him.

Still, Westly and Orszag warned of the tendency to withdraw money from retirement accounts early. Explaining that private accounts would not help the solvency problem, Orszag emphasized the need for a mixture of benefit decreases and revenue increases. Breaux′s experiences, though, show a tremendous amount of resistance to any changes.

Employer pensions have become more rare, and those still in existence are under-funded. Belt explained that there are so many loopholes to the laws that even a law-abiding firm can lack enough money to cover obligations. The Pension Benefit Guaranty Corporation is in charge of guaranteeing pension obligations out of dues from participants, but solvent firms are unhappy about supporting under-funded pension programs. Nor is it right for taxpayers to support the pensions, as only 10 percent are covered under such programs.

Agreeing with Breaux that defined benefit plans are on their way out, Belt continued that CEOs have no reason to start new pensions, due to the number of regulations and huge financial obligation. Workers do not value defined benefits because they do not appreciate the risk assumption the employer takes on, Orszag explained. However, Belt rejected this assertion as a "myth." Rather, he pointed out, if the fund does well, the employees receive no extra benefit and if the fund does poorly, they may have to accept smaller benefits, as did the United pilots. He indicated that this is also a problem with social security.

Greater employer contributions to 401Ks and greater use of 401Ks and IRAs by employees may help increase retirement security. Orszag believed that personal savings could be increased by making it easier and increasing the incentives. He advocated an opt-out system, where people are automatically enrolled in their company′s 401K, rather than the current opt-in. He also suggested an option on the tax form to have one′s tax return put directly into an IRA. Although Breaux was wary of the government seeming to strong-arm people, he supported the ideas. However, he warned that attempting to get employers to contribute more to 401Ks would likely go as well as past efforts to make them contribute more to health insurance.

All four panelists supported changes in the current retirement system to encourage greater savings and agreed that social security and defined benefit plans are in trouble. However, what changes are needed is a matter of contention, especially as to how wise it is to privatize social security.

Moderators
Michael Clowes, Editorial Director, Pensions & Investments
Speakers
Bradley Belt, Executive Director, Pension Benefit Guaranty Corporation
John Breaux, former U.S. Senator; Senior Counsel, Patton Boggs, LLP; Vice Chairman, President's Federal Tax Reform Advisory Panel; Senior Managing Director, Clinton Group
Peter Orszag, Joseph A. Pechman Senior Fellow, Economic Studies, Brookings Institution
Steve Westly, Controller, State of California
9:30 am - 10:45 am
Despite the fear factor associated with the rapid growth of China, global trade throughout the past century has been and will continue to be good for the United States economy. Throughout the history of trade, the United States has consistently benefited from economic convergence and interdependence with other national markets. While it may be argued that there is no historical precedent for the rapid growth of an economy as large as China′s, careful U.S. policy designed to mitigate current trade implications will enable the United States to continue to reap the benefits of a free, global trading system.

According to Diana Farrell, "U.S. movement toward protectionist policies will decrease American competitiveness and thus lead to a decrease in America′s comparative advantage."

In addition to developing free trade policies, panelists suggest that rather than look to protectionist trade barriers, or intervention of foreign markets, the United States should focus on its own internal structures to determine ways to increase its comparative advantage. In particular, panelists agreed the U.S. would command a much stronger position within the expanding global market were it to invest in its own infrastructure, such as improving its education system and altering its immigration standards in order to retain foreign born, but U.S. educated, individuals to contribute to American innovation.

Looking to the external effects on the American economy from strong foreign markets, panelists suggest the rapid growth of China is actually positive for the United States. "A really dangerous world would be a failing China" said Clyde Prestowitz. Additionally, all panelists agreed that China′s ascension to the WTO was a positive step for global economics.

Despite the positive effect of China′s growth on the United States, interdependency inevitably does present some external risks to the U.S. economy, such as the large trade deficit the United States maintains with China. Of particular concern, is the effect of such a large deficit on the geo-political positioning of the United States.

Charlene Barshefsky noted that "it′s troubling that over half of worldwide dollar reserves are held by only four Asian countries." Panelists suggested both the whittling down of the national deficit and a refocusing of Congress′ attention from regional trade agreements such as NAFTA and CAFTA to the growing Asian economies to the East.

Yet, despite the inherent risks of global trade, panelists agree that a world with free trade will produce more economic well-being than the converse. According to Diana Farrell, "we should embrace and manage the challenges of free trade."

Moderators
Evelyn Iritani, International Business Reporter, Los Angeles Times
Speakers
Charlene Barshefsky, Former U.S. Trade Representative; Senior International Partner, Wilmer Cutler Pickering Hale and Dorr LLP
Diana Farrell, Director, McKinsey Global Institute (MGI), McKinsey & Company
Steven Green, 12th U.S. Ambassador to the Republic of Singapore; Managing Director, Greenstreet Partners
Clyde Prestowitz, Jr., Founder and President, Economic Strategy Institute
9:30 am - 10:45 am
Nanotech has become the key buzzword for the cutting edge of technology. By focusing on objects only a billionth of a meter in size, scientists have been able to make significant advances in computers, engineering and molecular biology. Some of the strongest forces in physics, chemistry and biology exist at this level, and the leaders of computing, manufacturing and biotech are demonstrating just how important these forces are to business, government and our lives.

Current application of nanotechnology might be at the "grotesquely practical" level at the moment, but this panel of experts believe that 10 or more years down the road, nanotechnology will revolutionize virtually every industry, as well as impact everything from the way we live to how long we live.

"You can think of it as the new industrial revolution," said F. Mark Modzelewski. He said that nanotechnology, just by enabling manufacturers to put things together without waste and control the entire manufacturing process, is already proving to be very promising.

Dubbed as "the next big hope," the technology with "unbelievable and great potential," "the nexus of the sciences," nanotechnology can defy any clear definition due to the vastness of its application and interdisciplinary nature. In addition to the material sciences and engineering, nanotechnology has also impacted medical and biological sciences, even helped industries tap into alternative energy sources.

"Nanotechnology is the potential solution to many problems and is most efficient and most friendly to the environment," said Roy Doumani.

However, the technology is still considered in the nascent stage and finding commercial applications may prove challenging. F. Mark Modzelewski said that in terms of "working at the molecular level and putting things together...we are not yet good at it yet...we are not yet good at working at the nanoscale....Yet revolutionary changes like stain-free clothing, wash-proof clothing, revolutionary change, things that are considered grotesquely practical... might open a whole new world," Modzelewski added.

"Commercialization is simplest when it comes to products, materials, application, [yet we can also] merge microelectronics with nanoscience to improve medical sensing, address epileptic conditions, monitor glucose in the blood, etc., with nanoenabled devices to treat medical conditions," explained Magnus Gittins.

For research and development to push further, change has to transpire. Different sectors of academia from engineering to the sciences have to work together, learn a common language, and cooperate with industry to do collaborative research and foster technology transfer. Funding also has to continuously flow, both in the U.S. and globally, to support these collaborative efforts.

According to Doumani, "their goal at the California NanoSystems Institute is to create a nanotech community." While funding from the state is an investment by the state to create an intellectual property that could be turned into industries and jobs, Doumani believes that the collaboration within the university should be complemented by the industry sector, for example, venture capital enterprises that can guide research and identify further commercial applications.

Piotr Grodzinski, program director for Cancer Nanotechnology of the National Cancer Institute, believes that the academic community needs to be open-minded. "Academia is getting more progressive in the sense that it is now working closely with industry and seeing the potential market value (of research)," added Gittins. He thinks collaborative, multidisciplinary team research by universities with support by the industrial sector will foster a perfect environment to technology.

The panelists′ favorite areas of nanotechnology were in vivo sensors, microelectronics, injectible polymer chips, in vitro sensors, and other applications in biology, the health sciences and materials sciences. While worldwide investment in nanotechnology last year was $8.6 billion, half of this went to the university research centers and the remaining went to the industrial sector.

Steve Jurvetson advised against jumping into an equity investment in a single nanotech company. "It takes a great amount of research and time and at this stage it is too early to tell (which company will make it or not), but it will be pretty exciting in the next three or more years," he said.

Jurvetson disclosed that his company has also made nanotech startup investments oversees. Investment in countries such as Russia, China and India ensure that the U.S. has a stake in the worldwide breakthrough developments in nanotechnology, Dennis Kneale pointed out.

Gittins believed that "the best way is by portfolio approach as it is still too early to understand what is happening... it is a very competitive environment and investors have to be very hesitant to take a gamble."

The panelists agree that big industries are also investing in nanotechnology, as they can be patient with timeline and as companies like GM and GE have in-house research that tap into nanotech applications.

The panelists also believe over-regulation will hamper innovation and that global competition is good for the industry. Jurvetson cited the lack of human capital as the biggest problem, not the source of capital, as it is not easy to find scientists and engineers that are interdisciplinary. Being able to form business teams and venture teams and hire people with interdisciplinary, interpersonal and business skills are key factors to any nanotech enterprise.

Moderators
Dennis Kneale, Managing Editor, Forbes magazine
Speakers
Roy Doumani, Acting Chief Operating Officer, California NanoSystems Institute
Magnus Gittins, Co-founder, President and CEO, Advance Nanotech Inc.
Piotr Grodzinski, Program Director for Cancer Nanotechnology, National Cancer Institute
Steve Jurvetson, Managing Director, Draper Fisher Jurvetson
F. Mark Modzelewski, Co-founder and Managing Director, Lux Research, Inc.
9:30 am - 10:45 am
Despite public perception of weak Latin American economic growth and unfavorable regimes, underlying trends paint a more optimistic picture.

"The vestiges of sound fiscal policy are there," affirms Jeffrey Davidow. Davidow pointed out that the series of economic reforms attempted in the region, guided by principles commonly known as the Washington Consensus, have ended the catastrophic inflation problems felt by much of the region in past decades.

Other panelists agreed. "The last two years have actually been very buoyant," commented Richard Feinberg. Feinberg cited higher commodity prices and the recovery of the U.S. economy as positive developments in stimulating Latin American growth.

Despite this progress, however, high levels of inequality and corruption plague the region, and popular dissatisfaction has caused a push for leftist and populist leaders in many Latin American nations, which could spell trouble for foreign investment. The region also gets low scores from monitoring organizations in its protection of property rights, and for the strength of its court systems.

"All these things are very bad for investment," according to Andres Antonius. Still, said Antonius, "the important thing with these risks is not to get gloomy... but to recognize them. Those companies that do well... understand the risks, and face them head on."

So what prospects does the future hold for Latin American economies?

According to many of the experts present, one of the keys will be China. As China′s own economy soars, increasing financial flows with the Asian giant has contributed to bolstering Latin American economies.

However, the panel agreed that Latin American economies are difficult to generalize. "There are some very important distinctions," said Paul Knight. Knight maintains that while China′s explosive growth is good for nations such as Brazil, Chile and Argentina, it could be bad for nations like Mexico that compete with China in international markets. Further, concerns about China's ability to maintain its present growth loom. Nurturing other trade agreements in the region will be important to the stability of its growth.

"Trade agreements, these days... are the equivalent of strategic alliances," stated Feinberg. Agreements in the making, such as the Central America Free Trade Agreement (CAFTA), "can produce sustainable growth."

Certainly, the world will be keeping an eye on Latin American growth, watching for signs of trouble that have triggered past financial crises as the landscape of global trade continues to change. But lowered inflation and trade alliances may be reasons to believe that growth is stable, this time around. As Knight hopefully suggests, "The outcome may not be as traumatic as it has been in the past."

Moderators
Hilton Root, Senior Fellow, Milken Institute; Freeman Fellow and Professor of Economics, Claremont Colleges
Speakers
Andres Antonius, Managing Director, Kroll's Latin America Desk
Jeffrey Davidow, President, Institute of the Americas
Richard Feinberg, Professor, International Political Economy; Director, APEC Study Center; Chair, Global Leadership Institute, Graduate School of International Relations and Pacific Studies, University of California, San Diego
Paul Knight, Managing Director, Head of Latin America Investment Banking, UBS AG
Nelson Ortíz, President, Caracas Stock Exchange
9:30 am - 10:45 am
This session′s panelists examined four social issues — increasing home ownership, infectious disease, environmental problems, and human capital development — and how financial innovations could solve them. Panelists examined trends within the U.S. as well as globally identified social and financial challenges to addressing these issues and reviewed current financial innovations. Overall, the panelists agreed that many encouraging trends have emerged, and were cautiously optimistic about the potential of financial products to alleviate the four pressing social problems identified.

While the securitization of mortgages has facilitated home ownership for many Americans, the increased cost of housing—largely because demand exceeds supply—has resulted in a significant proportion of the American population that is unable to afford a home. Lew Ranieri noted that "we′re leaving behind ever-greater percentages of the population."

Some panelists found the growth in adjustable-rate mortgages particularly troublesome: in 1998, adjustable-rate mortgages comprised 7 percent of all new mortgages, while at present they are over 40 percent of new mortgages. Panelists were concerned that these mortgages create less net equity for owners, as compared with traditional mortgages, potentially resulting in greater default risk. Regarding the global housing market, panelists agreed that complications are primarily due to the lack of property rights. Government may play a key role in facilitating the development of legal property rights, as it did in the U.S.

The economics of infectious disease present a different set of challenges. While specific cultural practices play a role in the spread of infectious diseases, panelists were primarily concerned that the incentive system regarding medical research and distribution is misaligned. In particular, Richard Sandor brought up the concern that the U.S. patent system is outdated and suggested that patents for scientific/medical innovations be extended to 30 years. Ranieri, on the other hand, stated that patent duration could remain at 17 years, but that the costs associated with patents needed to be lowered. Sandor concurred with this suggestion, commenting that "I spend more money in securing patents than in R&D and that′s troublesome."

The market for environmental goods has progressed significantly in recent years. While significant environmental problems such as access to treated water confront the globe, advances have been made, such as decreased sulfur dioxide emissions (i.e., acid rain), for example. As Sandor noted, "The right to use water or air is more valuable than food and we can use the price system to allocate that right." The challenge is to determine how to value these commodities, and how to assess quantity and quality. Panelists concurred that a global approach to environmental and climate change issues is essential.

The final topic panelists explored was how financial markets can facilitate the development of human capital. Panelists noted that 74 percent of the U.S. wealth is in human and social — not financial — assets. Panelists were concerned that the effective financing mechanisms for post-secondary education (i.e., the extensive loan program) have not been replicated for K-12 education. Given the state of public education in the U.S., panelists asserted that new financial tools were necessary in order to offer parents greater choice for their children′s education. One of the options explored included securitizing educational investments as was done so successfully with home mortgages.

Moderators
Glenn Yago, Director, Capital Studies, Milken Institute
Speakers
Michael Milken, Chairman, Milken Institute; Chairman, Prostate Cancer Foundation; Chairman, FasterCures / The Center for Accelerating Medical Solutions
Lewis Ranieri, Founder, Hyperion Private Equity Funds; Chairman, CEO and President, Ranieri & Co., Inc.
Richard Sandor, Chairman and CEO, Chicago Climate Exchange, Inc.; Senior Fellow, Milken Institute
Myron Scholes, Nobel Laureate, Economic Sciences; Chairman, Oak Hill Platinum Partners; Frank E. Buck Professor of Finance Emeritus, Stanford University Graduate School of Business
9:30 am - 10:45 am
In the past, wealthy families established their own family offices or turned to a trust bank for most of the services they wanted. Now wealthy families can choose between a family office, a trust department or a multifamily office. And for today's wealthy family, it's not just about wealth preservation. Families expect wealth transfer and philanthropic activities to be conducted within the context of their particular goals and strengths. The family or multifamily office is uniquely positioned to help a family create a legacy that's an expression of what members have determined to be their unique identity and mission.

9:30 am - 10:45 am
This roundtable discussion focused on a variety of issues related to corporate pension obligations, including the legal and regulatory landscape, valuation assumptions and potential liquidity impact. Panelists reviewed several major industries where legacy costs have a substantial impact, specifically the airline, automotive and manufacturing sectors, and offer some case studies. Participants focused on some of the significant liabilities to a plan, including contribution liability, termination liability and control-group liability.
Speakers
Bradley Belt, Executive Director, Pension Benefit Guaranty Corporation
James Conlan, Partner, Vice Chairman, National and International Corporate Reorganization and Bankruptcy Group, Sidley Austin Brown & Wood
William Derrough, Co-Head, Financial Advisory Services Group, Jefferies & Company, Inc.
10:55 am - 12:10 pm
Many leading economists argue that markets are so efficient that there is little return or value to investing in actively managed funds. These scholars think that the best strategy is to invest exclusively in passive index funds of bonds and stocks. But many other academics have concluded that there are, in fact, talented managers who consistently outperform passive index funds. So where should you put your assets? Can a collection of talented active managers really beat the markets without adding a significant amount of risk? Can the unique talents of special individuals create value in investing and in maintaining capital?
10:55 am - 12:10 pm
In this roundtable discussion, Strauss Zelnick, former president and CEO of the music and entertainment company BMG Entertainment, discussed private equity investments in media companies.
Speakers
Strauss Zelnick, Founder, Partner, ZelnickMedia; former, President & CEO, BMG Entertainment; former President/COO, 20th Century Fox
10:55 am - 12:10 pm
The developing world represents 86 percent of the world's population. Its GDP may be low, but its citizens are the human capital and markets of the future. Tapping the opportunities in these regions will require challenging — and even changing — marketing and business models and partners. Many innovative companies are already there. In areas with water shortages, for example, Hindustan Lever created a successful detergent that saved two buckets of water for every wash. Cemex, one of the largest cement companies in the world, expanded its market using a network of family-planning educators as a non-traditional, but effective distribution system. ICICI bank's technology costs are a mere 5 percent of the technology costs of comparable U.S. banks. Through "impossible thinking," companies are recognizing unexpected opportunities at the "bottom of the pyramid" and creating new partnerships with enterprising entrepreneurs on the ground. Emerging markets are becoming parallel hubs for creating and scaling up disruptive innovations that serve the global economy. Many factors facilitating such disruption are converging in these markets. This panel explored these factors, the many growth opportunities in developing markets and how you can realize them.
Moderators
Yoram (Jerry) Wind, The Lauder Professor and Professor of Marketing; Director, SEI Center for Advanced Studies in Management; Editor, Wharton School Publishing; Academic Director, The Wharton Fellows Program, University of Pennsylvania Wharton School
Speakers
Valeria Budinich, Vice President, Full Economic Citizenship Initiative, Ashoka U.S.A.
Bhaskar Chakravorti, Partner and Thought Leader, Monitor Group LP
C.K. Prahalad, Harvey C. Fruehauf Professor of Business Administration & Professor of Corporate Strategy and International Business, University of Michigan
10:55 am - 12:10 pm
Entering the 21st century, the whole world has seen more risk arising both in the political and economic realms. Risk assessment is very important as it affects the decisions of policy makers, academic scholars and the private sector. As emphasized by most of the panelists, the greatest instability is in China.

The rapid economic growth of China since the 1980s should not cloud our realization that this amazing high growth is actually very inefficient, panelists remarked. The savings rate in China is at about 40 percent; its fragile banking system, nonperforming loans, unemployment and under-employment in rural areas, all represent potential hazards to the Chinese economy. There was heated debate about whether China is headed for a "soft landing" or a "hard landing," with Joyce Chang pointing out that it would be worse if there were no landing scenario at all in China.

On the political side, some panelists felt the Taiwan problem, disputes arising among different interests group, political reform, and tension with other countries put the whole world at risk. Marc Miles differed, saying China should not be regarded as a threat to the world. Rather, he would question whether or not other countries can accommodate the rapid export growth of China. The true threat, he said, is American and European protectionist policies and their fear of changing.

Oil and other commodity prices was another hot issue on this panel discussion. Though most people concentrated on the effect of increasing oil prices, Miles insisted that that increase occurred because it was linked to the dollar. If it were in terms of gold, he said, than prices would not be much different from before. Furthermore, the prices of other commodities have been rising also, such as real estate. The inflation risk is across the board, not just in oil.

Looking at the world as a whole, Asia is the key to growth in this century, especially China and India′s economic development. With regard to Africa, panelist were in favor of removing barriers that prevented people from engaging in private enterprise over increased aid from other developed countries. They noted that in oil countries, the risk is that the abundant oil resource stops people from actively pursuing other ventures. That will become extremely important when oil resources abate one day in the future, they said. Lastly, Russia could be an up-risk or down-risk, depending how it proceeds.

Despite the risks, the world still has a bright future, panelists agreed. If we take on those risks as challenges and focus on solving them, we can create more opportunities in our generation.

Moderators
Ian Bremmer, President, Eurasia Group Ltd.
Speakers
William Anderson, National Intelligence Officer for Economics and Global Issues, National Intelligence Council
Joyce Chang, Managing Director, Global Head of Foreign Exchange, Emerging Markets and Commodities Research, JPMorgan Chase & Co.
Joel Kurtzman, Senior Fellow, Milken Institute; Principal, Kurtzman Group
Marc Miles, Director, Center for International Trade and Economics, Heritage Foundation
Robert von Rekowsky, Portfolio Manager – Emerging Markets, Fidelity Investments
10:55 am - 12:10 pm
More often than not, discussion of China tends to focus on commerce and economic growth. The roundtable discussion, "Political Reform in China," moderated by Perry Wong, attempted to shift discourse toward trends in government policies. China has been experiencing wildly successful GDP growth rates since 1978 and is expected to surpass United States′ GDP within 20 years.

Panelists presented varying perspectives on the political and social challenges to China′s sustained economic growth. James Tong likened the panel of academics to the "Three Little Maids From School" in Gilbert and Sullivan′s Mikado. However, the speakers were not all "filled to the brim with girlish glee" about China′s economic future.

A surprising number of potential adversities lie within China′s social and political domain. Charles Wolf kicked off the discussion with his list of the more significant long-term challenges discussed at length in his book Fault Lines in China′s Economic Terrain. The issues range from high poverty and AIDS rates, to resource shortages, to the reduced availability of investment capital. Wolf also mentioned the possibility of an armed conflict with neighboring Taiwan or Japan. While Wolf conceded that it is unlikely for all of these events to occur, he mentioned that it is less unlikely that none of these shocks will damage China′s economic growth. Wolf also quantified the economic impact of such events in terms of a percentage decline in GDP growth, with the spread of HIV/AIDS and water shortages potentially having the most significant impacts.

Other panelists were more optimistic about China′s ability to prevent such social and political maladies before they happen. James Tong distinguished China′s problems from those Wolf characterized as being "like a time bomb, without a fuse or display." Tong noted that China′s problems are very predictable and cited many examples of quantifiable improvements along the eight fault lines identified by Wolf.

The most recent improvements have been in the area of civil liberties, in that Chinese citizens have more freedom of religious, political and sexual expression. These freedoms have allowed the country to develop more effective responses to the AIDS epidemic by recognizing and engaging with the homosexual community, and to corruption by allowing private citizens to file grievances against government officials.

A third perspective on Chinese political reform was offered by Keijan Gu. Gu firmly emphasized that "the primary mission of political reform is for economic policy-making." While the panelists may have disagreed on the severity of challenges it will face in the coming years, they were unanimous about the goal of maintaining China′s GDP growth.

Wolf highlighted that it is in the United States′ interest to sustain China′s economic success story. The speed of China′s political reform may not be blazing fast, but its efficacy will have more lasting significance.

Speakers
Kejian Gu, Professor of International Trade, Renmin University of China; Visiting Professor, UCLA Anderson School of Management
James Tong, Associate Professor, Department of Political Science, University of California Los Angeles
Charles Wolf, Jr., Senior Economic Adviser and Corporate Fellow in International Economics, RAND Corporation
Perry Wong, Senior Research Economist, Milken Institute
10:55 am - 12:10 pm
The panel agreed that while the U.S. real estate market has risen substantially recently, with some people calling it a "bubble," real estate is still the best asset class to invest in for the future. Cap rates are lower than they′ve been for years and with housing prices rising faster than inflation some are concerned that the time to invest in real estate is past. Panelists agreed that the market may not be as attractive in the future as it has been in the last few years, acknowledging several downward pressures like rising unit labor costs.

"We are in the midst of the greatest monetization in the history of the world," claimed Sam Zell, referring to why it would be harder to find great returns in real estate in the future. More capital is flowing into the real estate markets looking for good deals hence driving down overall market returns. The inflow of capital is great for sellers of real estate though according to panelist Barry Sternlicht, "you have the perfect storm," referring to the alignment of macro factors in favor of holders of real estate.

So is the U.S. market overvalued? Not according to the panelists. Even though real estate prices have been soaring in certain high-profile markets in the U.S., many in California, real estate is a local business and many markets have been experiencing only very modest growth. With unemployment down and mortgage rates low, panelists Bruce Karatz and Larry Mizel agree that it′s a great time to be a builder. Home ownership is on the rise and more families are realizing the "American Dream" of owning their own home than ever before.

Further, "you don′t have to worry about people importing housing into this country," Mizel reminded audience members. There was no fear of foreign competition or outsourcing on this panel.

What about the impact of increased security concerns since 9/11 on the value of global hotel real estate? Barry Sternlicht is unconcerned. The leisure traveler never stopped and in recent years business travel is back, making the hotel industry stronger than ever, being one of the few industries with pricing power. That equals increasing profits, falling to the bottom line, and increasing returns to hotel real estate shareholders.

Panelists identified a few opportunities for investment in real estate. The increasing general population in the U.S. helps the real estate market, but Mizel and Karatz pointed to increased immigration and the aging baby boomer generation as particularly good trends. With larger legal immigration than ever before, demand for housing in their communities will continue to grow rapidly. Sternlicht and Zell have also invested substantially in senior living facilities and are poised to capitalize on that demographic trend. Mizel cautions however that most people want to live in their same communities when they age, near their friends and family, not move to a "facility" in Arizona or Florida.

So where do the panelists recommend investing in real estate in the future? All agreed that they favor markets with strong "barriers of supply," referring to restrictions on new building in many communities. Specifically, look at California, Florida, New York City and Denver.

Moderators
Lewis Feldman, Managing Partner, Pillsbury Winthrop Shaw Pittman LLP
Speakers
Bruce Karatz, Chairman and CEO, KB Home
Larry A. Mizel, Chairman & CEO, MDC Holdings, Inc.
Barry Sternlicht, Chairman, Starwood Hotels & Resorts Worldwide, Inc.; President and CEO, Starwood Capital Group
Sam Zell, Chairman, Equity Group Investments, LLC
10:55 am - 12:10 pm
The U.S. population has seen huge growth in our collective waist sizes in recent years. Two-thirds of Americans are now overweight, with one-third considered obese. Nutritionists often debate the sources of this trend and its cure, but no one debates that we are eating more in general, and of unhealthy foods, in particular. Portion sizes have doubled in many instances over the last 20 years, with the average bagel now having a diameter of six inches and a caloric count of 350, versus three inches in diameter and 130 calories in 1985. Sugars and fats are being consumed in large quantities, with soft drinks now representing 33 percent of our sugar intake. The panel looked at explanations for this trend and what we can do to reverse it.

The low price of energy-dense foods has led to their increased consumption. Energy dense foods have large amounts of sugars and fats, which cost roughly $2 per 40,000 calories. In other words, as Adam Drewnowski half-jokingly calculated, a pound of body weight costs about $0.12. Jennifer Wilkins suggested that one reason for this low price is structural issues in the food system, including subsidies for foods with high glycemic indexes such as corn (the source of the ubiquitous high-fructose corn syrup) and soybeans (the primary source of fat in most foods). We would expect low prices of energy-dense foods to disproportionately raise the obesity levels in poor areas, and indeed, Adam has determined that "obesity rates are reliably predicted by zip code" with a .76 R-squared correlation.

Even when consumers want to eat better, they often do not have access to healthy foods. Consumers in poor areas are particularly prone to this lack of choice, since markets in disadvantaged areas are unlikely to offer kale and asparagus. Consolidation of the food industry has also led to large farms with homogenous product, and 85 percent of all vegetables are now pre-contracted. Aside from the niche consumer who purchases directly from a local farm, the result has been limited opportunities for consumer choice.

David Heber and Stuart Trager presented their views on ways to counteract the trend of unhealthy food consumption. Heber′s research has focused on the benefits of colorful foods, since "color indicates the presence of specific phytochemicals with health effects." These phytochemicals are beyond antioxidants, and in fact have been shown to stimulate DNA repair.

One easy way to add color to a diet is to replace such fruits and vegetables as potatoes and corn with sweet potatoes and broccoli. Trager generally agreed with the notion of increased consumption of fruits and vegetables, but also cautioned that one type of diet does not work for everyone. The major contributing factor to weight loss is consistency, and diets that encourage participants to remain on the program are more likely to have success. For 30 million Americans, the Atkins diet has proven to be such a program.

The panel′s overall advice was summarized by Roger Wyse, who suggested that in order to lead a long and healthy life you must eat your fruits and vegetables, exercise, and consume calories in moderation. Genetics may predispose us to certain illnesses and diseases, but predisposition does not mean that these traits will be expressed. Some of how you age is genetic, but the rest is diet and exercise. In short, as Drewnowski reminded us, "your mother was right."

Moderators
Roger Wyse, Managing Director, Burrill & Company
Speakers
Adam Drewnowski, Director, Nutritional Sciences Program, Professor, Epidemiology, Adjunct Professor, Department of Medicine, University of Washington
David Heber, Founder, Director, University of California, Los Angeles Center for Human Nutrition
Stuart Trager, Medical Director, Atkins Nutritionals, Inc.; Orthopedic Surgeon; Founder, ELITE Health & Wellness, Pennsylvania Hospital
Jennifer Wilkins, Sr. Extension Associate, Division of Nutritional Sciences (DNS), Cornell University, College of Human Ecology
12:20 pm - 2:00 pm
Moderated by Michael Milken, three Nobel Laureates in economic sciences discussed investment in human capital, education, the relative benefits of economists and scientists, health and global population.

Milken began the discussion by asking the panelists to consider the value of human capital. Gary Becker explained that human capital consists of education, health and training, but the incentive to invest in each of these varies with the nation and region. In America, firms determine how much training to invest in workers. However, there are currently no mechanisms for firms to commercially invest in individuals′ educations. Although banks make student loans, the interest rates are set and the loans are guaranteed by the government. Myron Scholes countered that education investment faces high transaction costs and agency problems.

Milken moved the conversation to K-12 education. Scholes pointed out that many parents pay for their children′s education twice over, once in property taxes and again in private school tuition, yet vouchers are always too low to make up cost. Edward Prescott would prefer that the vouchers be scholarships for low-income students. Comparing K-12 to higher education, Becker pointed out that competition has created the best university system in the world, but K-12′s only competition comes from families moving, a method that lower-income families, who suffer the worst schools, cannot exercise. He believes that charter schools and open enrollment are viable alternatives to vouchers.

Considering the downfall of America′s schools, Prescott considered whether, compared to the past, the low esteem in which teachers are held may be why there are more poor-quality teachers. Milken questioned whether this is related to the advancement of women: once the smartest women became teachers; now they have other options. Becker attributes the deterioration in teacher quality and loss of merit pay on teacher unionization. Scholes questioned whether university tenure, which also prevents the merit compensation, may create a similar problem, but Becker countered that competition in higher education overcame this.

Next, Milken asked the panelists to consider the assertion of scientists that too many of the brightest minds are going into economics and finance rather than science. The panelists universally rejected this idea, emphasizing their value in the allocation of scarce resources. Prescott remarked that economics′ market mechanisms for reducing water and air pollution have reduced pollution more effectively and cheaper than engineers thought possible. In response to Milken′s comment that scientists often feel oil depletion is ignored, Becker explained that such predictions had long been made and long been wrong. Rather, such forecasts fail to take innovation, which is driven by price, into account; the real cost of energy has remained constant over time, despite periodic spikes in price.

The economists extended the idea of price driving changes into health. While Scholes believed that fuller knowledge of the costs of obesity would decrease it, Becker countered that medical technology, especially anticipated medical innovation, effectively decrease the cost of obesity. For example, since AIDS therapies have decreased the mortality of the disease, high-risk groups have exercised less caution.

Changing prices have also shaped globalization. As Milken pointed out, exceedingly cheap telecommunications have made outsourcing call centers to India possible, while exceedingly expensive U.S. medical care has made medical tourism cost-effective. Becker felt both were examples of comparative advantage bringing production to the most efficient place, as countries develop up the production ladder. However, the U.S. will still possess a comparative advantage for the most complex medical procedures.

"It′s easier to build than rebuild," Milken stated, referring to the developing world′s advantage in creating the most up-to-date factories compared to their American competitors.

Despite these advances, 40 percent of the world lives on less than $2/day. Scholes countered that China subsidizes its people′s food and housing, distorting their income. Also, the government keeps the prices low, creating an asset bubble. Noting the huge variability in income among Chinese provinces, Prescott stated that more factories are being brought to poorer provinces to take advantage of the lower wages there. Becker presented India and China as success stories, which African countries would do well to emulate through individual incentives and market freedom.

Another potential problem facing the world is overpopulation, but the economists did not believe it to be a major issue, stating that world population will stabilize. In fact, Prescott questioned whether having more people inventing things would not be a good thing. Becker concurred, noting that more people also enlarge the market. With that, the panel, which championed the power of economic thinking in public policy, concluded.

Moderators
Michael Milken, Chairman, Milken Institute; Chairman, Prostate Cancer Foundation; Chairman, FasterCures / The Center for Accelerating Medical Solutions
Speakers
Gary Becker, Nobel Laureate, Economic Sciences, 1992; Professor, Economics and Sociology, University of Chicago; FasterCures Board Member
Edward Prescott, Nobel Laureate, Economic Sciences 2004; W. P. Carey Chair of Economics, Arizona State University, W. P. Carey School of Business; Senior Monetary Advisor, Minneapolis Federal Reserve Bank
Myron Scholes, Nobel Laureate, Economic Sciences; Chairman, Oak Hill Platinum Partners; Frank E. Buck Professor of Finance Emeritus, Stanford University Graduate School of Business
2:15 pm - 3:30 pm
Over the last three decades, the world of finance has seen an explosion of financial innovation, the growth of non-U.S. capital markets and the opening of emerging markets in regions as diverse as Asia, Latin America and Eastern Europe. With the weakness of the dollar, the burgeoning U.S. trade and deficits, and the proliferation of hedge funds, there are questions as to the sustainability of the U.S. as the leading destination for the world's investments. This panel debated what role the U.S. will play in the world's capital markets in the decades ahead, and whether non-U.S. markets can ever represent a real challenge to the U.S.

Opening the panel, Robert Lessin pointed out that in 1995 there was limited activity in hedge funds and private equity in the capital markets. The U.S. was the dominant player. In 2005, new investment strategies, along with the rapid growth in developing countries′ capital markets, covered every headline. Lessin called for answers from the panelists on three questions: In 10 years, 2015, who will manage your money? In what type of securities do they invest? Where do they invest?

William Duhamel outlined the activities in hedge funds and pointed out the main differences from traditional mutual funds: hedge funds are, in general, unregulated, have good incentive structures and compensation systems, and unique trading strategies. He added that the strategies commonly found in hedge funds (e.g. long-short positions, convertibles, arbitrage, etc.) are not new inventions, but spin-offs from traditional investment banks.

Keith Rosenbloom further indicated that hedge funds are investment partnerships in which the mangers play a real role in generating absolute returns for investors. Many negative claims against hedge funds, for instance, heightening volatility and market manipulation, were largely unsupported with existing evidence. Both Duhamel and Rosenbloom do not believe that hedge-fund activities should bear the guilt for enhancing volatility in the markets.

Russell Chambers, on the other hand, suggested that liquidity may be a hidden problem in hedge-fund activities. The mismatch of liquidity expectation may generate dispersions in the markets. Moreover, it appears to him that regulations on hedge funds are on the way and will "force them to be more transparent."

The discussion then moved to the second question. Thomas Valenzuela commented that the rapid growth in these new investment opportunities has created a brain-drain on investment expertise and increased regulations. As a result, he predicted that the mutual funds will become more specialized in the sense that manufacturing and distribution activities are separating on the way.

The panelists made several predictions: some type of "hybrid vehicles" may be introduced to the market that comprise the distinct features of hedge funds and mutual funds. The Europeans are ready to "embrace the whole industry" and national boundaries, especially between the Atlantics, will not exist. The distinctions are becoming more blurred in terms of investment products and cross-border activities. The widespread use of the Internet provides a new channel of investment, education and marketing. All of them foresee innovation on security types through standardizing instruments and globalization.

The discussion moved into the third question on development of capital markets outside the U.S. Victor noted a puzzling fact that the saving rate in China is around 40-45 percent and yet only 7 percent are invested in securities; most money - 68% - is simply put into banks for modest interest rates. The maximum cap of 15 percent investment in securities for most companies is not met. The entrepreneurs are therefore conscious of other investment activities, but very cautious about the bad reputation of domestic capital markets.

Chambers noted a couple of successes on foreign non-European countries, but the truth is that it′s "very tough to have comparable scale to the U.S." He also criticized the substantial rise in auditing costs to fulfill the government regulations simply because of bad experiences with a few companies. The audience concurred with applause.

While acknowledging the comment by Chambers, Victor Yang expected to see substantial capital market development in China. The rising market demand will eventually ask for it, he said.

Moderators
Robert Lessin, Vice Chairman, Jefferies & Company
Speakers
Russell Chambers, Managing Director, UK Investment Banking, UBS Limited
William Duhamel, Managing Member, Farallon Capital Management, LLC
Keith Rosenbloom, Managing Member, CARE Capital Group, LLC
Thomas Valenzuela, President/ Chief Investment Officer, Valenzuela Capital Partners LLC
Victor Yang, Partner, Boughton Peterson Yang Anderson
2:15 pm - 3:30 pm
After Pat Cox delivered a brief summary of the strengths and growth prospects for Europe and the European Union, the panelists were ready to debate the challenges facing the continent as it plans for the future. The issues most dominant were finalization of a just settlement of the Bosnian War, the admittance of Turkey into the European Union and the political/cultural divide over the pending ratification of the European Constitution.

Beginning with Europe′s most recent and deadly conflict, former NATO Commander General Wesley Clark described the lingering effect of the Bosnian War. General Clark stated that there are still far too many unresolved questions about the political status of the region and that hostilities remain. "The U.S. and the EU must take the lead in settling this episode of European history." The continued lack of resolution to this conflict is holding back the entire region from growth and threatening its stability. Witold Orlowski echoed the need for European leadership and noted that it was the prospect of entering the EU that kept Poland on its path of reform after the collapse of communism.

Turning the focus to Turkey and its potential entry into the European Union, Ali Babacan laid out the benefits of allowing Turkey to join the EU for both his nation and the entire European Union. However, above all else, he remarked, it is the nature of the reforms in Turkey that are of critical importance, not the question of entry into the Union. General Clark agreed and advocated that entry of Turkey into the EU will provide an economic benefit and added political strength to the Union as a whole.

The EU will begin negotiations with Turkey on the question of entry on October 3rd of this year. Already, this has become a topic of disagreement across Europe. General Clark believes that issues of disagreement stem more from economic concerns rather than cultural differences. Pavel Telicka also downplayed the cultural differences and believes that much of the negative feelings held by Europeans toward the idea of letting Turkey join the Union is caused by a lack of debate on the subject. He feels that no matter what the outcome, this debate on enlargement will have to happen at one point or another.

Differences of opinion over the pending ratification of the European Constitution are also beginning to grow. Most detractors to this argue that the Constitution is a threat to sovereignty and their national identity. But when does ones pride in national identity swell to nationalism? The ratification of the European Constitution (or failure to do so) will forever alter the European Union.

Despite the notion that economics are the cause for the consternation on the Turkish question, cultural differences always play a role in European politics. Europe is struggling with social problems that stem from these differences and is constantly grappling with issues of immigration, integration and assimilation. Recent acts of terrorism, rising anti-Semitism and the success of fascist leaning politicians point to a rising social crisis as the European Union continues to grow. Adoption of a European Constitution may be a powerful force in stemming this tide. Ensuring equality and harmonizing liberties throughout the Union will go a long way to help the process of European Unity.

Moderators
Pat Cox, Member, European Liberal Democrat Group and Reform Party, Member of the Bureau; former President, European Parliament
Speakers
Ali Babacan, Minister of State for the Economy, Turkey
Wesley Clark, General (ret.), U.S. Army; former Commander, NATO
Witold Orlowski, Senior Economic Adviser to the President of Poland
Pavel Telicka, Partner, BXL Consulting; former EU Commissioner
2:15 pm - 3:30 pm
As companies move toward offering more work-life benefits for their employees, senior managers want to know the return on their investment in these benefits. A distinguished panel of leaders will share their experiences about how their own organizations assess ROI of these programs, the development of tools that can assess investment in work-life benefits and the ROI of specific work-life programs in their organizations.
Moderators
Kathleen Giel, Vice President of Employer Partnerships, Knowledge Learning Corp.
Speakers
Lynn Franzoi, Senior Vice President, Benefits, Fox Entertainment Group
Kenneth Jaffe, Executive Director, International Child Resource Institute
Katie Krauch, Manager, WorkLife, Child, & Family Resources, Northwestern University
2:15 pm - 3:30 pm
China′s has been experiencing high growth at an average rate of 9 percent for the past 20 years, which caught the attention of the whole world. Despite such an amazing economic development, China still faces many problems, one of which is the under- and nonperforming assets of $666 billion. The current situation is not optimistic: huge nonperforming loans (NPLs), a depressed stock market, unequal treatment for private sector investors, inadequate legal protection, and so on present serious challenges.

China′s banks are mostly state-owned or controlled. That transforms the Chinese government′s fiscal deficit into the bank′s budget problem, pointed out Raymond Foo. He also emphasized the problem of low return on equity, too much leverage by banks and inventories building up in China. James McCaughan showed that the NPL ratio of the "Big Four" banks in China is much higher than the listed banks. Also China currently has an unhealthy interest regime that makes "borrow short, lend long" profitable. The loan growth is still strong, but it does not imply that the qualities of those loans are improved together. Some of the NPLs were sold to foreign banks, which can be simple or complicated depending upon whether it turns out to be a "smart acquisition" later.

China′s stock market performance is also not very satisfactory. In Japan, stock market performance is positively correlated with GDP growth, while in China, it is the opposite case. The H-share has decreased by 34 percent in the last 10 years; the MSCI China is down 88 percent and A-share stock is 13 percent after the QFII scheme.

David Chen said that one of the problems is with those companies listed overseas: local people know those Chinese companies well, but cannot buy their stocks. That is also the case for Chinese companies listed on Hong Kong′s stock market, which compete with the Shanghai A-share stocks. Combined with the increasing number of corporate scandals happening recently, investors′ confidence in China′s stock market is very dampened.

Two other problems were mentioned during the discussion. The first was that private investors still face many barriers, such as banks′ reluctance to make loans to them although they are doing better than the state sectors. The second one is the inadequate protection of creditors provided by the China′s legal system: the creditors′ priority is still behind the employee—paying wages and the government—paying taxes.

Though the under- and nonperforming assets appear to be a peril, it does not mean they will never become "opportunities" in the future. There are some good signals. Daniel Fung told the story of meeting some Chinese judges from Beijing who hold degrees from American and British universities, signaling the Chinese′s government′s intention to reform their legal system. Meanwhile, as economic development is moving from the coastal areas inland, technology, consumer products, manufacturing and other markets are becoming more prosperous than ever before.

Moderators
James Barth, Senior Fellow, Milken Institute; Lowder Eminent Scholar in Finance, Auburn University
Speakers
David Chen, CEO, Fintel Group
Raymond Foo, Managing Director & Head of Strategy, BNP Paribas, Asia
Daniel Fung, former Solicitor General of Hong Kong; Senior Counsel, Hong Kong Bar; CIETAC Arbitrator
James McCaughan, CEO, Principal Global Investors, LLC
2:15 pm - 4:55 pm
Moderators
Greg Simon, President, FasterCures / The Center for Accelerating Medical Solutions
Speakers
Anna Barker, Deputy Director for Advanced Technologies and Strategic Partnerships, National Cancer Institute
Leroy Hood, President, Institute for Systems Biology
Carol Kovac, General Manager, Healthcare and Life Sciences, IBM
Stephan Targan, Director, IBD Center
Craig Venter, President, J. Craig Venter Science Foundation; Founder, The Institute for Genomic Research
Ronald Weinberg, Chairman & CEO, HAWK Corporation
2:15 pm - 3:30 pm
With productivity declining at virtually every big pharmaceutical company, how will the drugs of the future be developed? More and more, the discovery, development and manufacturing of new drugs, as well as clinical trials, is taking place outside of the U.S., including China, India and Eastern Europe. In this roundtable discussion, Bill Haseltine, founder and former chairman and CEO of Human Genome Sciences, and one of the world′s gene-based research pioneers, met with conference attendees to talk about international drug discovery and development opportunities.
Speakers
William Haseltine, President, Haseltine Associates, Ltd.; former CEO, Human Genome Sciences
2:15 pm - 4:15 pm
The Israelis and the Palestinians have been striving for peace for the last two decades. Many political initiatives to achieve peace were introduced, but none prevailed and frustration has risen to new heights. According to today′s panel, however, despite the complexity of the situation, there is room for hope. The panelists stated that politics and governments only account for one side of the story, and that much progress can be made by the other side: the private sector.

By using financial resources, structures and technical knowledge to align the interests of the parties, resolve conflicts and create jobs, the private sector has the capacity stimulate economic growth in the area, making it easier for political progress to be made, claimed the panelists. For example, through the development of efficient and transparent financial markets, American and European investors would be able to invest in Palestine, having the opportunity to reap fine returns while also making an outstanding social impact. Through fund raising efforts to provide small businesses — both in Israel and in Palestine — with loan guaranties, these businesses would be able to obtain finances and create jobs and economic growth. For the 150,000 unemployed people in Gaza alone, there could be no better news.

But how exactly could this be achieved? Should the private sector operate independently or as an aid to the area′s governments? Most speakers were in favor of the latter approach. Muhamed Rachid said that a new vision should be implemented by mutual efforts of governments, investors and donors; Abraham Sofaer explained that a better economy will not necessarily bring better politics, and peace can only be made by politicians.

Other panelists, however, expressed more extreme approaches. According to Carl Kaplan, "if anything is going to happen, it is going to happen by the private sector." From his experience, in order for progress to be made, the government has to follow the private sector. "Let them take the credit, and let us do the work," he concluded. Menachem Feder held the opposite approach. He stated that until the Palestine Authority legislated property rights rules and enforced them, investors would not be able to comfortably invest in Palestinian businesses.

In conclusion, while this session raised innovative ideas for improving the unfortunate economic and political situation in the Middle East, the impact of such ideas is yet to be seen. Clearly, both the Israelis and the Palestinians are striving for peace and for economic growth. All hoped that they will overcome their difficulties and make the necessary steps towards a better reality.

Moderators
James Prince, President, Founder, The Democracy Council
Speakers
Jafar Hassan, Deputy Chief of Mission, Embassy of Jordan
Mohamed Rachid, CEO and General Manager, Palestine Investment Fund
Hasan Rahman, Chief Representative of the Palestinian Liberation Organization (PLO) and the Palestinian Authority
Omar Salah, CEO, Star-Brands Capital LLC
Moshe Tery, Chairman, Israel Securities Authority
2:15 pm - 3:30 pm
While experts vary on the ultimate trillion-dollar number, the intergenerational transfer of wealth underway in the U.S. has the power to fuel a transformation of the wealth planning industry, create social and financial issues that last for generations and spawn a golden age of philanthropy. Wealth transfer happens every day through the sale of real estate, business succession, and retirement and estate planning. This unprecedented wealth transfer comes at a time when consumers are more confused than ever about financial planning due to the sophistication of products available. This roundtable discussion focused on such issues as: How can the transfer of wealth best be administered and guided in a collaborative manner between CPAs, attorneys, wealth-transfer experts and other financial advisors? How can collaborative wealth planning help people best achieve their business, financial and philanthropic goals?
Speakers
David Reyes, Financial Architect, Founder Reyes Consulting, Inc.
2:15 pm - 3:30 pm
Former Sen. John Breaux, vice chairman of the President's Advisory Panel on Federal Tax Reform, gave an update on the panel′s recommendations for revenue-neutral policy options for reforming the Federal Internal Revenue Code. One of the president's main objectives is to create more simplified tax codes and reduce the costs and administrative burdens of the IRS. Breaux also shared his views on the benefits of a more progressive tax structure while recognizing the importance of homeownership and charity in American society. He was be joined in the discussion by Steve Forbes, President and CEO of Forbes and a former GOP presidential candidate. Participants also discussed the role of tax policy on long-term economic growth and job creation, as well as increasing savings and investment to strengthen U.S. competitiveness in the global marketplace.
3:40 pm - 4:55 pm
3:40 pm - 4:55 pm
This roundtable session looked at the world's water supply. Do we have enough? Do we have enough where it's needed most? As the world's population continues to grow, this resource vital for human existence becomes more and more precious and sought. What technologies can be used to extract water from previously unavailable places? Can alternative energy sources help in the search for water?
Speakers
Quentin T. Kelly, Founder, Chairman and CEO, WorldWater & Power Corporation
3:40 pm - 4:55 pm
A lack of available financial resources for post-secondary education is affecting the 21st century workforce and its ability to stay competitive. How can alternative financial sources meet and stay ahead of the demand for education dollars? Unlocking the true value of human capital will rely more and more on the private sector. As tuition costs rise, the challenge of how to augment the public sector will cause new financial alternatives to be created.
Moderators
Cathleen Raffaeli, President, Cardean University
Speakers
Gerald Parsky, Partner, Aurora Capital Group
Catherine Reynolds, Chairman and CEO, Catherine B. Reynolds Foundation
Ted Sanders, Former President, Education Commission of the States; former Acting Secretary of Education
3:40 pm - 4:55 pm
Having a good lobbyist in Washington, D.C. used to be the key to good government relations. Today, corporations are taking a much more strategic — and local — approach that involves more decision makers in the public policy process. Advocacy needs to take place in state capitols and at the grassroots level to better reach decision makers through their constituents. This roundtable discussion focused on the merger of campaign tactics, public relations and government relations — and the benefits these combined strategies bring to the public and private sectors domestically and abroad.
Speakers
Brian McCabe, Partner, DCI Group; President, Progress for America Voter Fund
Minyon Moore, Head, State and Political Practice, Dewey Square Group; former Chief Operating Officer, Democratic National Committee; former Director of White House Political Affairs and Office of Public Liaison (Clinton/Gore Administration)
Karen Skelton, Principal, Dewey Square Group; former Chief Council, Federal Highway Administration; former Political Director for the Vice President of the United States (Clinton/Gore Administration)
3:40 pm - 4:55 pm
We all know the China manufacturing story - with millions of workers, and labor costs low, it produces much of the world′s goods. As Fortune recently reported, half of the world′s clothes and one-third of its mobile phones are made in China. But that′s old news. Today it is China′s growing technological and scientific prowess that has everyone′s attention.

Rob Koepp opened the discussion with some facts about the Chinese economy. Increasingly, foreign firms are considering strategies aimed at integrating China-based research and development labs into their global research agenda. For example, Motorola has 19 research labs in China. Recognizing the importance of this sector to its economic future, China′s education policy has begun producing large numbers of educated workers. Some 325,000 Chinese engineering students graduated in 2004 — five times more than in the U.S. What are the global implications of this change? What is the Chinese strategy, and how should the West respond?

Panelists began by examining China′s technology assets and their potential, and the implication on intellectual property rights and protection. Duncan Clark pointed out that major telephone equipment companies like Ericsson, Nokia, Motorola and Alactel all have their production capacity along China′s coastal regions. They are also building up the R&D centers. "There has been substantial outsourcing of design and real R&D in China," he added.

"Taiwan went through the same issue 20 years earlier," Ta-Lin Hsu noted. He stated that many Taiwanese entrepreneurs and executives are commuting to China for work. China, according to him, has moved up the value chain: originally from manufacturing assembly to original development and innovations. He expected to see more research-type manufacturing happening in China for the following reasons: 1) low labor costs with real wages rising slightly; 2) increasing human capital; 3) a rise in venture capital. On the other hand, he consciously stated that intellectual property rights are still lagging behind.

Owen Wu agreed with Hsu. He believed that market competition, a huge talent pool, along with favorable government policy, will be the main driving forces behind the rapid innovations in China. All of these "accelerate high technology development."

He further stated that government-supported innovations are one of the keys to success. One example is the semiconductor industry which arose in the mid-1990s as a result of government-incentives.

Charles Wolf was skeptical on growth, productivity and employment. He noted that China′s economic growth was largely explained by a rise in labor productivity, leaving very limited room for employment growth.

Moderators
Rob Koepp, Research Fellow, Milken Institute
Speakers
Duncan Clark, Managing Director, BDA China Limited
Ta-Lin Hsu, Chairman & Founder, H&Q Asia
Charles Wolf, Jr., Senior Economic Adviser and Corporate Fellow in International Economics, RAND Corporation
Owen Wu, Founder, Chief Strategy Officer, Global Communication Semiconductors, Inc.
3:40 pm - 4:55 pm
Blogs are changing the rules as to how and when people get information. There are now over 9 million active weblogs, with 80,000-100,000 dedicated to politics and news alone. Can the growth and prevalence of weblogs create a sufficient outlet to replace traditional media as a source of news? This question was considered by the distinguished panelists who discussed the future of news gathering as we embark upon a continuously evolving era of new technology and audience participation.

Will blogging improve news gathering or hurt it? The panel unanimously agreed that it would improve it. Jim Bankoff noted that news and their respective news brands are stronger than ever. Even amongst teenagers, news is the number one type of input that they seek. And yet in this digital age, there is an increasing demand for information, choice and control. With VOD and DVR, audiences consume what they choose and go directly to it.

David Sifry pointed out that the "blogosphere" has been growing rapidly and expected it to continue to double each month for the next five years. Not only has there been a growth of new blogs, but also a 30 percent increase in posting volume since May 2003. He animatedly referred to the power of bloggers and their ability to focus on the far more interesting niche and topical areas of the media landscape.

The panel agreed that traditional media reporters cannot and would not want to be in all places at once. It does not make sense for reporters to cover every baseball game, but if there is a market for local reporting, someone just might. It takes time to deploy resources and reporters to respond to instances of natural disasters, but local amateur sources enable immediate and timely coverage that may not necessarily replace, but can easily supplement and be integrated into traditional news gathering and distribution. Jim Bankoff stated it best, saying, "it′s not about the scoop, it′s about getting ahead of the scoop."

So if it′s about getting ahead of the scoop, what drives the scoop? At the heart of the conversation was the notion that there is a huge shift in power with no barriers to entry; power rests in the hands of consumers. Media needs to start figuring out how to deal with this. Joe Trippi stated that blogging is in the nascent stages of a huge revolution. As television audiences become increasingly fragmented, this is the single biggest opportunity for existing media brands to leverage and grow their business. Moderator Jonathan Weber pointed out "If everyone has a microphone, then you can′t hear anyone." Neil Budde concurred; those who suffer most are the ones who try to be everything to everyone. Still, people do respond to honesty.

Audiences already have trust and recognition in the establishment and the establishment, in turn, can benefit by leveraging how media is created in this journalistic process. Jim Bankoff closed by stating that there has never been a better time to be a consumer of news, where audiences are able to make their own judgments and react when and how they want. With audiences talking back, media distributors have an opportunity to listen and make them want to keep coming back.

Moderators
Jonathan Weber, Founder and Editor in Chief, New West
Speakers
Jim Bankoff, Executive Vice President, AOL Programming & Products
Neil Budde, Director, Yahoo! News
David Sifry, Founder and CEO, Technorati
Joe Trippi, President, Joe Trippi & Associates
Mortimer Zuckerman, Publisher, U.S. News and World Report and New York Daily News
3:40 pm - 4:55 pm
Some outsiders think of Brazil as a volatile emerging-market economy led by a leftist president—Luiz Incio Lula da Silva. However, investors who have dug beneath the surface have found a very different country that has changed dramatically over the last 10 to 15 years. President Cardoso implemented a number of reforms in the 1990s that pushed the country toward the future, and Lula has maintained the course. As a result, Brazil enjoyed impressive economic growth of 5.2 percent in 2004, and Goldman Sachs predicts that the country will become the world′s fifth largest in terms of GDP by 2050.

Brazil′s economic growth has been fostered by political, fiscal and monetary changes that have created a hospitable environment for investors. Democracy has been in place since 1985 and recent elections brought in a president who does not belong to the elite establishment—further proof that the democratic system is robust. Import tariffs have been reduced from 50 percent to 10 percent over the last 20 years, inflation has been tamed, and the fiscal surplus has grown to 5 percent of GDP, leaving the country much less vulnerable to external shocks.

Minister Luiz Fernando Furlan estimated that the 2005 trade surplus will be $36 billion with strong GDP growth (although somewhat below last year′s rate). Supporting the Minister′s position, John Welch stated that Brazil′s "economic recovery is robust despite higher world interest rates." In addition, the fundamentals are generally sound; Thomas "Mack" McLarty, III referred to Alcoa as one example of a major company that views its Brazilian plants as some of its most competitive.

Alexandre Bettamio provided a capital markets overview that showed a strengthening of the financial systems. A number of companies have been able to tap equity markets, largely due to improvements in corporate governance requirements. Trading volume reached record highs and is continuing to grow, with much of the activity coming from Brazilians. The credit market has returned to normal levels, and local debt markets are strong.

According to Nathalie Hoffman, Brazil has followed its economic success with a more assertive role in international affairs. The country has joined Germany, India, and Japan in bidding for permanent seats on an expanded UN Security Council. Brazil, in conjunction with India and China, is also leading a new group of developing countries—dubbed the G-20—in trade negotiations.

Brazil′s relationship with China is particularly significant, and recent moves have brought the two countries closer together. Trade between the countries has increased four-times in the past four to five years, and Brazil wishes to double this number again in the next four years. China has increased its investments in infrastructure and businesses in Brazil, and Asian investors have started to purchase Brazilian bonds. While Brazil is pushing forward on its attempts to sign a free trade agreement with the U.S., it has also turned towards a similar agreement with Europe that shows promise of being signed in the near term.

Brazil is a country poised for strong growth in the future. Successful fiscal and monetary reforms, the stability of a true democracy, increasing geopolitical presence, growing strategic relationships and strong investment at home, make Brazil a good opportunity for investors. As Minister Furlan stated, "Good news will be coming steadily from Brazil... wait and see."

Moderators
Nathalie Hoffman, President, UBC Global Reach
Speakers
Alexandre Bettamio, Managing Director, Head of Investment Banking Brazil, UBS AG
Luiz Fernando Furlan, Minister, Brazilian Ministry of Development, Industry and Foreign Trade
Thomas “Mack” McLarty, III, President, Kissinger McLarty Associates; former Chief of Staff, Clinton Administration
John Welch, Senior Vice President, Sovereign Strategy, Lehman Brothers
3:40 pm - 4:55 pm
Mass marketing as the way to effectively reach consumers has been waning as buyers have stepped up the pressure by taking control of the brand-consumer relationship. They buy TiVo units with glee; they have convinced legislators to outlaw most telephone and e-mail marketing; and with their 500-plus TV channels, Internet, satellite radio, video games and thousands of magazines, consumers have become more elusive than ever. At the same time, companies and their marketers are under more pressure than ever to perform — to get more customers, to maximize lifetime value from their existing customers, grow share and grow profits. These trends have created the greatest disruption in the history of advertising. There are now new tools to help marketers quantify precisely what is working and what is not. Market response econometrics, for instance, have evolved in prominence and importance in the past several years, becoming the secret weapon for marketers who realize the old metrics are increasingly meaningless.

Come contribute to a roundtable discussion on the latest ways to get to the bottom of maximizing marketing ROI and optimizing your precious marketing dollars, as well as building brands in a challenging new world. This roundtable gathered marketers, industry experts and econometricians to discuss: what part of my marketing mix is working, and how much should I spend to hit my objectives?

Moderators
Wes Nichols, Co-founder, MarketShare Partners
5:05 pm - 6:00 pm
Former U.S. Vice President Al Gore gave an engaging and accessible presentation about the history and implications of trends in global warming to a standing-room-only crowd. Bolstered by graphics and video clips, Gore explained the scientific causes of global climate change in terms that people unfamiliar with the issue could easily understand.

Gore outlined the history of scientists′ emergent realization of patterns that indicated the global warming problem. Roger Revelle, Gore′s college professor, was the first to measure carbon dioxide in the atmosphere and chart the upward trend over time. This work had an impact on Gore that moved him to put global warming on the government′s agenda throughout his career in the Senate and White House. Mounting evidence, however, shows that the response of the U.S. government over the past 30 years has failed to forestall the problems predicted by scientists in the 1960s. Continually rising temperatures contribute to climate changes that have a serious impact on the environment.

The higher temperatures result in stronger storms, shown by the increasing intensity and destructive power of hurricanes, and the record number of typhoons in Japan in 2004. The economic losses generated by weather and flood catastrophes are escalating, and will continue to rise, based on the observed trends in weather patterns. Gore noted that without change, carbon dioxide levels in the atmosphere will soon quadruple; the associated 60-65 percent loss of moisture in the soil is expected to cause devastating soil erosion.

Another problem associated with global warming is that fewer frost days foster the development of vectors for infectious diseases, 30 of which have developed in the last 30 years. The transmission of diseases such as malaria, West Nile Virus, and the Avian Flu is facilitated by the climate changes.

Hotter temperatures also mean that glaciers worldwide are disappearing at an alarming rate: glaciers in Latin America, Switzerland, China, Australia, South America, the Austrian Alps, and Alaska have nearly fully melted. In 15-20 years, Gore predicted, there will be no more snows of Kilimanjaro. Dramatic changes in Greenland suggest that it may be gone by the end of this century. The resulting rise in sea level would have dire consequences all over the world; in the U.S., a rise of 19.7 feet (6 m) would flood parts of Florida, New Orleans, and Manhattan. Gore showed a map of Manhattan with the former location of the World Trade Center marked, then showed that the site would be underwater with the expected change in sea level.

In addition to illustrating the urgency of the problem, Gore emphasized the U.S. contribution to carbon emissions as being greater than the total combined emissions of South America, Central America, China, the Middle East, and Indonesia. At the same time, the U.S. has lower emissions standards than Japan, the EU, Australia, and Canada.

Gore challenged common misconceptions about global warming with persuasive evidence, and argued that the magnitude of the problem before us requires change. He noted that, contrary to public perception, there is little disagreement among scientists about the existence of a problem. He also debunked the common myth that we must choose between the economy and the environment by showing that car manufacturers meeting higher emissions standards are actually performing better. "We can′t sell our cars in China," he said, "We don′t meet their environmental standards."

Gore concluded by saying that the problem of global warming is not too big to fix, and noted that we have found solutions to seemingly insurmountable problems in the past. His final call to action was a plea to make changes now for the benefit future generations. He reminded the audience that the earth is our only home, and we must protect it; as he said, we must "keep our eyes on the prize."

Please note: This session is not available on DVD.

Speakers
Al Gore, former Vice President, United States of America
6:00 pm - 7:00 pm
6:00 pm - 7:00 pm
6:00 pm - 7:00 pm
7:00 pm - 9:00 pm
Are democracy and the media compatible? This was the question Jeff Greenfield posed to former Vice President Al Gore, Roger Ailes and Mortimer Zuckerman. The answer was a resounding "yes" from all three men, in a night filled with tension, debate, and laughter.

Greenfield asked the panelists about the advent of the Internet, and its effect on more traditional media such as television and newspapers.

"We don′t actually go to air with anything off of a computer website," Ailes responded. Zuckerman affirmed Ailes′ sentiment, saying that for the papers that he publishes, more confirmation of a story than one website is needed. Clearly, the Internet has not had as powerful an effect on traditional media as once thought. Then Greenfield steered the panelists towards a related issue: the newfound abundance and resulting fragmentation of the media. What this means right now is that there are more sources for news than ever before (abundance) and within this multitude of sources, a vast range of specialized points of view (fragmentation). Whereas once there were three major networks that all told the same stories in the same ways, now, there is a media outlet to reflect every faction, persuasion and political bent.

Former Vice President Gore said that "our media has...a fierce political point of view." All of the panelists agreed on the partisan nature of the media. Now that there are so many choices for consumers in terms of where they get their media, it seems as if the only way for a network, newspaper or website to succeed is to walk the fine line between maintaining a loyal customer base (by sticking to a well-defined and possibly narrow political viewpoint) while somehow managing not to alienate newer viewers who might not share those ideas or philosophies.

Another key idea brought up by Greenfield was the role of television in the media. Ailes, Gore and Zuckerman all agreed that it is by far the most prevalent and influential medium in America and across the world today. Referring to the phenomenal power of television, former Vice President Gore said, "The Internet doesn′t glue eyes to the screen like T.V. does." He cited the examples of the Michael Jackson trial and the Terry Schiavo case, which he called "serial obsessions." He lamented that while these ultimately minor news stories are blown up to epic proportions, more important issues are ignored. But Zuckerman argued that as a result of television′s enormously widespread and pervasive influence, Americans have achieved a "much broader level of informed opinion" than ever before.

Greenfield then asked if the media itself could actively play a role in the spread of democracy. To that point, Ailes asserted that "media is the watchdog of democracy." He spoke of people in Lebanon watching liberated Ukrainians on television and being inspired to fight for democracy in their own country. Former Vice President Gore also proclaimed that the media "has been responsible for the contagion of democratic fervor." Clearly, these men believe that the media, particularly television, can take a positive and proactive role in the spread of democracy across the world.

At the end of the evening, Ailes turned the issue around and noted that in fact "democracy allows freedom of the press to flourish." All agreed on this final point and the panel came to a close with thunderous applause.

Moderators
Jeff Greenfield, Senior Analyst and Contributor to Judy Woodruff's Inside Politics, CNN
Speakers
Roger Ailes, Chairman and CEO, Fox News
Al Gore, former Vice President, United States of America
Mortimer Zuckerman, Publisher, U.S. News and World Report and New York Daily News
Wednesday, April 20, 2005
6:30 am - 9:00 am
6:45 am - 7:40 am
6:45 am - 7:40 am
A large portion of today′s family wealth — especially with the first generation of wealthy individuals — is concentrated in a few assets, such as the family′s company stock, or in illiquid assets like real estate. Money managers cannot put together an optimum portfolio for these families without paying attention to this concentration of illiquid assets. Consider these two examples: One family has $1 billion in cash and another $1 billion concentrated in and oil and gas. Another other family has $1 billion in cash and $1 billion invested in real estate in Russia. If all else were equal, the investments of their liquid assets should be very different to take account their different sources of illiquid wealth. Being attentive to the different sources of illiquid wealth can preserve capital and create more wealth over time with greater certainty than by ignoring those differences. Why do most wealth managers ignore the differences in spite of the obvious gains from attention?
6:45 am - 7:40 am
What are the key elements of effective school reform? What can individuals do to help improve how our children are taught and how they learn? How can they use their philanthropic dollars to change the education system so that all children learn more? This interactive roundtable discussion with Lowell Milken, Eli Broad and Lew Solmon offered examples of how we can improve education in the U.S. through philanthropy.
Speakers
Eli Broad, Founder, The Broad Foundation; Chairman, AIG Retirement Services Inc. (formerly SunAmerica Inc.); founder & Chairman, KB Home (formerly Kaufman and Broad Home Corporation)
Lowell Milken, Chairman, Milken Family Foundation
Lewis Solmon, Executive Vice President, Education; Director, Teacher Advancement Program, Milken Family Foundation; Former Dean, Graduate School of Education, UCLA.
7:45 am - 9:00 am
How do you motivate children who grew up with wealth? Should you give them money or not? How much? Does wealth decrease their incentive? What affect does wealth have on children? What is the proper balance of transferring wealth between generations? If you do give them money, how do you do it in a way that makes it more likely the inheritance will survive through future generations? Is there a way to understand the implications of the choices of wealth transfer for you and your family? What money messages do our children inherit from us? How can we raise children who are thoughtful about money and its meaning? This session focused on best practices for wealth transfer between generations.
7:45 am - 9:00 am
Are two-year transfer students getting lost in the pursuit of a four-year degree and beyond? Can we ease the barrier to success by forming better partnerships and using the Internet to solve working adults′ problems in attaining a bachelor′s degree? These and other questions were discussed in this roundtable with leading community college presidents to develop an "action plan for student success" that will serve working adults in their pursuits.
Moderators
Ted Sanders, Former President, Education Commission of the States; former Acting Secretary of Education
7:45 am - 9:00 am
Moshe Tery was joined by a group of prominent U.S. and Israeli investors discussing prospects for proposed financial reforms and broadening economic growth as a foundry of technology, medical and knowledge-based innnovation for domestic, regional and international markets based on research done by the Milken Institute and in Israel.

It was nearly a decade ago that the government of Israel made a surprising announcement: it was ready to begin the process of phasing out American economic aid. U.S. aid, though necessary, was supporting Israel′s antiquated regulatory structures and government dominated spending practices — appropriate for a fledging socialist state, but not a burgeoning competitive economy. Financial innovation to promote responsible fiscal behavior, market reform, entrepreneurial finance and broader economic participation was now the type of aid that was needed.

Despite its flaws and relative youth, Israel′s economy is the most vibrant in the Middle East and one of the most dynamic economies in the world. Practical lessons and real financial tools forged in recent decades ought to be utilized to stimulate Israel′s domestic capital markets, financing the country′s future.

All sides are now ready to expand their efforts beyond their current scope and create opportunity through applied financial innovation throughout the country. The interest level is high; the players are resolute and earnest.

Meaningful capital market reform is achievable in a variety of ways — creation of a vibrant securities market, introduction of new financial instruments, financing small businesses and mircroenterprises, privatization of municipal services, access to capital markets, establishment of employee-ownership plans, privatization of the water sector, and environmental finance, to name just a few.

Moderators
Carl Kaplan, Managing Director, Koret Israel Economic Development Funds
Speakers
Moshe Tery, Chairman, Israel Securities Authority
7:45 am - 9:00 am
Steve Forbes started off the session by asking the panelists to share their views of the future of the American economy. Overwhelmingly, the consensus was rather negative, with a few positive highlights. John Breaux, former U.S. senator, began by citing the main difficulties that Congress faces today, namely, the high cost of energy due to increasing oil prices as well as rising health care costs and our inability to fund them under existing policies.

Richard Iley described the American economy as the Titantic — a big ship admired by the rest of world, but potentially running on excessive amounts of fuel and warned of "grave dangers lurking ahead," in particular, the large amounts of debt incurred by consumers. He described the U.S. economy as one with excessive undersaving and overconsumption as well as one "living well beyond its means." He also showed concern for foreign willingness to service the U.S. debt.

Continuing in this vein, Suzanne Nora Johnson described the current U.S. situation as an "air pocket of turbulence" and pointed out the high inflation and low savings rates in the U.S. Terry Semel injected a glimmer of hope in describing the relative success of American companies in integrating the Internet into American life, still, he questioned the U.S.′s future dominance as a leader in creating infrastructure in the field. Lastly, Barry Sternlicht talked about the weak dollar, foreign investment, the threat of offshore jobs and projected a "slowdown and seismic shift in the U.S. economy."

Forbes continued by asking the panelists what they thought would be the next breakthrough for the U.S. economy. Terry Semel emphasized the importance of building an infrastructure based on the Internet and TV Internet in order to stay competitive with other countries, going on to recommend that the government take initiative. Sternlicht agreed, stating that "Congress never created a clear path of how it was going to be done." The panelists then followed with a short discussion of the telecom industries, emphasizing that the world is increasingly changing to wireless technology and that current federal regulations need to be revised to promote competition.

Next, the panel turned to real estate, with Forbes posing the question "Is there a housing bubble?" Barry Sternlicht started off by stating that the double-digit rise in housing prices are not sustainable and predicted that the housing market should slow down, but further qualifyed this statement by pointing out that in locations in high demand, prices would most likely stay current. However, he pointed out that the weak dollar was encouraging the rise in housing prices by driving up demand by foreign entities. Johnson agreed with Sternlicht stating that people are spending more on housing than ever before and that this was alarming for the U.S. economy. Iley contended that there is "compelling evidence of a national housing bubble" and then pointed out that housing prices have risen 40 percent since 1997. He also raised concern about the fact that consumers today use their mortgages as "readily as cash from an ATM."

Forbes challenged the notion of a housing bubble stating that households today seem to be better off then ever before. Iley opposed this point of view by pointing out that people′s liabilities are rising more quickly than their assets and that both the American public and public sector have record amounts of debt.

The panel expressed concern over oil prices, with Breaux citing it as the one factor that would have the greatest implications for our economy. Forbes suggested that the rise in oil inventories and prices might possibly be due to speculation. Nora Johnson agreed, but added that supply and demand played a nominal role as well, as there are fewer suppliers of oil then ever before.

The panel touched on the importance of "Chindia" and the implications for the American workforce, concluding that American policy will have to change to adapt to the reality of a cheap, willing, and available labor force from other countries.

Forbes closed by asking about what the panelists what they thought of the Sarbanes Oxley Act. The overall consensus was that it is not good for the American economy, with Sternlicht saying that it encourages companies to not take risk and defer to auditors. The other panelists concurred, although Terry Semel pointed that parts of the Sarbanes Oxley Act help companies examine their internal accounting standards. Breaux commented that Congress will look at the measure again soon but is not planning any immediate changes in the near future due to the recent corporate climate.

Moderators
Steve Forbes, President and CEO, Forbes; Editor-in-Chief, Forbes magazine
Speakers
John Breaux, former U.S. Senator; Senior Counsel, Patton Boggs, LLP; Vice Chairman, President's Federal Tax Reform Advisory Panel; Senior Managing Director, Clinton Group
Richard Iley, Senior Economist - North America, BNP Paribas
Suzanne Nora Johnson, Vice Chairman, The Goldman Sachs Group, Inc.
Terry Semel, Chairman and CEO, Yahoo! Inc.
Barry Sternlicht, Chairman, Starwood Hotels & Resorts Worldwide, Inc.; President and CEO, Starwood Capital Group
7:45 am - 9:00 am
Stephen Goldsmith opened the panel discussion of early childhood education programs and delivery systems nationwide. His inquiry reflected the key concerns facing universal early childcare programs: quality, access and the debate over public versus private funding. Goldsmith′s conclusions reflected the notion that early childhood education programs and services will ultimately need to be based on the diverse needs of individual communities.

"If we create a program of quality, all children will benefit," said Graciela Italiano-Thomas. Italiano-Thomas is currently CEO and Executive Director of Los Angeles Universal Preschool—the county′s fledgling program to provide universal access to early childhood education to all four-year-olds within 10 years.

All panelists agreed that input from families and communities are a critical factor in creating a successful program. Elanna Yalow pointed out that one of the key facets of a quality program is consistency for the child. "If we look at a delivery system that provides for a child part-time, without looking at the child in the context of the whole family we have a piecemeal system that is a high risk." A good example of this is making sure that parents with children of multiple ages have transportation and access that works for their family.

"It is very important to get this right from the beginning," said Graciela Italiano-Thomas, who cites significant input from community groups. "We need to put down a foundation that can be scaled up without creating a lot of bureaucracy."

Lynn Karoly, an economist, looks at early childhood education as an investment. Karoly and her colleagues at the RAND Graduate School have considered the ROI of a universal preschool program, and have determined that we can place a dollar value on this type of investment. In fact, a high-quality Pre-K program generates $2.00—$4.00 per dollar invested.

"These benefits come from changes in children′s behavior both at school age and over the long term," Karoly said. Karoly cited a number of benefits including an increased number of high school graduates, reduced crime and delinquency, and reduced use of special education resources. Karoly′s analysis relies on data from a city-wide program in the Chicago public school system.

There was little debate among the panelists about what a successful program would include — a mixed delivery system using both public and private facilities and funding. Dennis Vicars pointed out that oftentimes interest groups are brought in from outside to debate the merits of the system and the children are unfortunately set aside. Mixed delivery, supported by all panelists, could serve to avoid the pitfalls of a system in which the overseer is also the participant. We need to "be advocates for children and not specific programs," says Elanna Yalow.

Moderators
Stephen Goldsmith, Daniel Paul Professor of Government, Director, Innovations in American Government Program, Ash Institute for Democratic Governance and Innovation
Speakers
Graciela Italiano-Thomas, CEO,Executive Director, Los Angeles Universal Preschool
Lynn Karoly, Director of Research Quality Assurance, Senior Economist, Professor of Economics at the RAND Graduate School
Dennis Vicars, Executive Director and CEO, Professional Association for Childhood Education Alternative Payment Program (PACEAPP); CEO, Human Services Management Corp.
Elanna Yalow, President and COO, Knowledge Learning Corporation
9:10 am - 10:20 am
The Milken Institute has a tradition in financial innovation, and recently it added to this focus an effort on stimulating medical research innovation through its center, FasterCures. This roundtable discussion will seek to combine these two efforts by exploring the value and potential of financial tools — structured finance, securitization and secondary markets — in intellectual property rights (IP) as they might increase capital investment and improve capital structures to advance the discovery of medical solutions. The objective is to monetize the value of future discoveries by advancing their development. Going beyond traditional licensing arrangements, advanced financial technology could be applied to estimate and realize future value of royalties over a number of years from a portfolio of patents relevant to a disease group or medical problem. This would provide capital to accelerate research, development and product innovation. The cash flows of a portfolio of disease-related patents could be turned into marketable securities to bridge the capital gap for faster cures. This requires the application of a much wider array of financial instruments than is currently observable in this market. The discussion focused on three topics:

I. Successes and Failures in the Securitization and Valuation of IP
II. The Barriers to Secondary Markets in IP
III. The Feasibility and Desirability of an Exchange for IP

This panel formed a basis for a future conference to assess the feasibility and obstacles of such securitization and exchange, how they have been and can be structured, and lessons learned from past attempts that have failed or succeeded in this area.

Speakers
Martha Amram, Author; Founder, Growth Options Insights LLC
Robert Block, Managing Director, Technology Option Capital
Robert D’Loren, President & CEO, UCC Capital Corporation
Nir Kossovsky, Founder, President and CEO, Technology Option Capital, LLC
Tomas Philipson, Milken Institute Senior Fellow, Professor, Irving B. Harris Graduate School of Public Policy Studies, University of Chicago.
9:10 am - 10:20 am
Steve Wynn, President and CEO of Wynn Resorts, talked about change, leadership and the creative process in large organizations.
Speakers
Steve Wynn, President and CEO, Wynn Resorts
9:10 am - 10:20 am
While life expectancy in the U.S. rose a remarkable 54 percent in the 20th century, our children face a greater chance of dying from diseases such as cancer, diabetes, neurological disorders, stroke and heart attack than their grandparents did. Scientists have amassed huge amounts of knowledge, and have the tools to unlock the secrets of biology. Research is leading us to transform our entire approach to discovering and developing new drugs and treating patients. In order for patients to reap the benefits of this new arena — "personalized medicine" — we need to ensure they know the vital role they play in finding cures.
Moderators
David Agus, Research Director, Louis Warschaw Prostate Cancer Center, Cedars-Sinai Medical Center
Speakers
Anna Barker, Deputy Director for Advanced Technologies and Strategic Partnerships, National Cancer Institute
G. Steven Burrill, CEO, Burrill & Company
Mark Simon, Managing Director, Health Care Group, Citigroup Global Investment Management
9:10 am - 10:20 am
"With technology and smart thinking, it is possible to do away with many of the traditional customs and structures in education," said Eugene Hickok. "Technology can not only help us to a better job at what we already do, but it can help to change the structure of education as we know it."

Jim Marggraff discussed what he believes are the three pillars of a 21st century learning solution: technology, engagement and curriculum. Marggraff demonstrated his latest product, the FLY pentop computer as a technology solution that could help to change the way students learn in the classroom. But Alan Bersin expressed "caution from the front lines: we should not look to technology before we develop the curriculum that will allow us to apply it systematically throughout our schools."

According to John Wilson, funding for technology has been reduced in the last five years. Wilson worries, therefore, about policy makers′ commitment to technology. He added that when thinking about technology, one needs to consider that "how kids are learning in school is totally different from how they are learning outside of school." He further stated that students need to have ITC skills and access to technology, but feels that No Child Left Behind does not specifically go into how to do that, offering limited language and directive. By way of example, Wilson cited his belief that NCLB had regressed the system of assessment in the schools back to paper-based scoring, despite the fact that the technology for online scoring is readily available.

Joe Tafoya stated that technology is very important to Department of Defense schools. Tafoya has tried to gear education around technology in an effort to overcome the challenges of delivering education to over 200 schools spread all around the world. Some 70 percent of Tafoya′s students are children of military personnel, who are comfortable and familiar with technology and training.

All panelists agreed that there is a great need to design curriculum in a way that supports students and teachers, and is scalable. Currently there are some individual schools which can be identified as utilizing technology in an effective way, but this kind of success needs to happen on a much greater scale.

The panel weighed in on both sides of the debate over No Child Left Behind, with Charles Edelstein inquiring as to the direction policy will take as the dialogue continues. Alan Bersin asserted that "NCLB is an attempt to bring an accountability system to the national dialogue," and the beginning of the effort to hold those involved in education accountable for quality. "This is about investment over time, milestones and metrics—it′s a generation′s work," Bersin said.

John Wilson asserted that many states were doing well at accountability prior to NCLB, including his home state of North Carolina. Schools that once showed exemplary growth are now accountable to a different system, he said, which does not build on their accumulated knowledge. Wilson believes that as a result, states will prefer to go back to a growth model, rather than stick with the NCLB model, which seems flawed and unrelated to their previous success.

Looking toward the future of No Child Left Behind, Hickok believes that public policy will focus on results and the debate over unfunded mandates.

Moderators
Charles Edelstein, Managing Director, Global Head, Global Services Group, Credit Suisse First Boston LLC
Speakers
Alan Bersin, Superintendent of Public Education, San Diego City Schools
Eugene Hickok, Former Deputy Secretary of Education, U.S. Department of Education
James Marggraff, Executive Vice President, Worldwide Content, LeapFrog Enterprises, Inc.
Joe Tafoya, Director, U.S. Department of Defense Education Activity
John Wilson, Executive Director, National Education Association
9:10 am - 10:20 am
Small and medium-sized businesses are the engine of the U.S. economy, creating 75 percent of all new jobs and generating 50 percent of the nation's business revenue. But in a rapidly changing global economy these businesses and their leaders need to be street wise and agile to survive and thrive. How do they compete with the big boys in the war for ideas, talent and capital? Where do these entrepreneurs see the economy going? What policy issues have the most potential to make or break these businesses? What economic trends present the greatest opportunities — and greatest risks — for these companies?
Moderators
Jim Canfield, Chief Learning Officer, TEC International
Speakers
Daniel Barnett, Chief Operating Officer, TEC International
Maria Contreras-Sweet, President and Co-Founder, FORTIUS Holdings, LLC; former California Secretary of Business, Transportation and Housing
Jerry Goldress, CEO, Grisanti, Galef & Goldress, Inc.
Saj-nicole Joni, CEO, Cambridge International Group, Ltd.
Beverly Kaye, CEO / Founder, Career Systems International
9:10 am - 10:20 am
This panel explored the challenges faced by reporters and photographers who put themselves in danger to cover the realities of the war in Iraq. A panel of three journalists and a photographer gave firsthand accounts of their experiences in Iraq, offering their opinions about issues such as the potential obstructions to objectivity, the extent of censorship concerns, and the reaction of the U.S. public to their reporting.

The overarching theme for the panel′s discussion was the question of whether Americans are getting the truth about Iraq. The panelists generally agreed that the U.S. media are doing their best to give accurate information about the war, but had concerns that those efforts do not guarantee an accurate end product; lack of knowledge about the context and background of the situation obscures the message. John Balzar noted that the constraints on the ability of Western journalists to get information are offset by the use of trusted Iraqi staffers, who are less conspicuous than Western correspondents. Merely gaining access to the information, however, is not enough to make up for our lack of knowledge about the goals and motivations of our enemy.

The panel members weighed in about the potential tradeoffs associated with embedded journalists. The reporters formed close relationships with the U.S. troops they observed in action, making the choice to report negative events about those troops a difficult task.

Mike Cerre felt that this challenge was a crucial test of the media′s ability to maintain objectivity while reporting in the field. Josh Hammer recalled an instance of witnessing what he characterized as nearly abusive behavior by U.S. Marines during counterinsurgency raids. Although the military was not pleased to have negative stories published, Hammer stressed that he did not feel any pressure to censor his reports. In fact, the other panelists also spoke about the willingness of the military to be more candid and allow journalists to publish events as they saw them without retribution.

A photograph by Luis Sinco epitomized the different perceptions of what Hammer called a "tremendous cultural gap." Sinco′s photo showed U.S. Marines milling around inside a mosque that an Iraqi military unit had destroyed with grenades in a training exercise the previous day. The photo looked to many Americans like evidence of U.S. progress in the counterinsurgency efforts, but invoked an angry response from Muslims, who were upset at the degradation of a holy site. The lack of cultural sensitivity on the part of the U.S., or even just the failure to anticipate other cultures′ perceptions of our actions, often aggravates the problems that we are trying to solve. The notion of perceptions transitioned into a discussion about the Arab news station, Al Jazeera. The journalists commented that the network had become an increasingly objective and a credible source of news.

Asked about the reception they received upon returning to the U.S. from their assignments in Iraq, the panelists highlighted the dichotomous response of the public. Simultaneously accused of being "part of the establishment" and "part of the revolution," the journalists are charged with both catering to the government and subverting it. The four panelists, however, seemed to accept this contradiction with a sense of irony and resignation.

In response to the question, "Would you go back?" the panelists had different perspectives. One would go if required by his employer; another would require a "big raise," and still another would go only for a big story. The fourth journalist gave the answer in the minds of most audience members: "No, thanks."

Moderators
Garrick Utley, President, Levin Graduate Institute, State University of New York; former Chief Foreign Correspondent and Anchor, NBC News
Speakers
John Balzar, Senior Features Writer, Los Angeles Times
Mike Cerre, Correspondent, ABC News
Joshua Hammer, Correspondent, Newsweek
Luis Sinco, Photographer, Los Angeles Times
9:10 am - 10:20 am
What′s the current thinking on short-term vs. long-term investments? Is their a demand for an investment style that can generate returns by blending traditional equity research with a focus on more intangible non-financial factors such as social and environmental responsibility and corporate governance? How can sustainability research be fully integrated with rigorous fundamental equity analysis to achieve optimal long-term investment results? Can long-only strategies over a significant time horizon compete with more versatile long/short products? In evaluating investment managers, what is the proper time horizon for selecting investment returns? Should there be a concentrated investment approach to maximum leverage of investments over the long run?
Moderators
Kieran Beer, Executive Editor, Bloomberg Wealth Manager
Michael Milken, Chairman, Milken Institute; Chairman, Prostate Cancer Foundation; Chairman, FasterCures / The Center for Accelerating Medical Solutions
Patrick Mitchell, former Chief Investment Officer, California State Teachers' Retirement System (CalSTRS)
Greg Simon, President, FasterCures / The Center for Accelerating Medical Solutions
Greg Simon, President, FasterCures / The Center for Accelerating Medical Solutions
Lewis Solmon, Executive Vice President, Education; Director, Teacher Advancement Program, Milken Family Foundation; Former Dean, Graduate School of Education, UCLA.
Lorraine Spurge, Managing Director, Post Advisory Group, LLC
Speakers
Roger Ailes, Chairman and CEO, Fox News
Frank Armstrong, CEO, Bioaccelerate
John Breaux, former U.S. Senator; Senior Counsel, Patton Boggs, LLP; Vice Chairman, President's Federal Tax Reform Advisory Panel; Senior Managing Director, Clinton Group
Deborah Brooks, President & CEO, Michael J. Fox Foundation for Parkinson's Research
Dominic Curcio, Co-Founder and Managing Partner of Guggenheim Capital LLC
Peter Early, Founder, CEO & Chief Investment Officer, Big Sky Capital
Robert Fedoris, CEO and Managing Partner, Private Family Office, Inc.
Kevin Felix, Managing Partner, Guggenheim Partners
Steve Forbes, President and CEO, Forbes; Editor-in-Chief, Forbes magazine
Eliot Geller, Vice President, Jefferies Financial Products, LLC
Robert Gertner, Wallace W. Booth Professor of Economics and Strategy, University of Chicago Graduate School of Business
Robert Gertner, Wallace W. Booth Professor of Economics and Strategy, University of Chicago Graduate School of Business
Paul Gigot, Editorial Page Editor, The Wall Street Journal
Kathy Giusti, President, Multiple Myeloma Research Foundation
Lee Hartwell, Nobel Laureate, Medicine, 2001; President and Director, Fred Hutchinson Cancer Research Center, Seattle
William Haseltine, President, Haseltine Associates, Ltd.; former CEO, Human Genome Sciences
David Heber, Founder, Director, University of California, Los Angeles Center for Human Nutrition
George Hester, Chairman and CEO, Navitas
George Hester, Chairman and CEO, Navitas
George Hester, Chairman and CEO, Navitas
James Heywood, d'Arbeloff Founding Director, ALS Therapy Development Foundation
Robert Klein, President, Klein Financial Corporation and Klein Financial Resources; Chairman, Independent Citizens Oversight Committee for the California Institute of Regenerative Medicine
Scott Klein, Managing Director , Investment Management, Post Advisory Group
Jim LaChance, Managing Director, Investment Management, Post Advisory Group LLC
Warren Lammert, Founder, The Epilepsy Project, Epilepsy.com
Tom Livergood, CEO, The Family Wealth Alliance; President, Family Office Management, LLC
Leslie Mancuso, President and CEO, JHPIEGO
Oliver Marti, Managing Director/Portfolio Manager Healthcare, Columbus Circle Investors
Lowell Milken, Chairman, Milken Family Foundation
J. Todd Morley, Founding Member, Guggenheim Capital, LLC
J. Todd Morley, Founding Member, Guggenheim Capital, LLC
J. Todd Morley, Founding Member, Guggenheim Capital, LLC
Dean Ornish, Founder and President, Preventive Medicine Research Institute; Clinical Professor of Medicine, University of California, San Francisco
Marc Primiani, Partner, Quintile Wealth Management
Kurt Rauzi, President and COO, Navitas
Robert Rawitch, Senior Vice President, Winner & Associates; Principal, Rawitch & Associates
Michael Rosen, Co-chairman and CEO, Context Capital Management, LLC
James Rosenwald, III, Founder & Managing Partner, Dalton Investments, LLC
Michael Ryan, Director of Alert and Response Operations, World Health Organization
Leif Soderberg, Advisor, Wealth Management Business, Guggenheim Partners
Stuart Trager, Medical Director, Atkins Nutritionals, Inc.; Orthopedic Surgeon; Founder, ELITE Health & Wellness, Pennsylvania Hospital
Keith Vernon, Principal & Founder, Bristlecone Advisors
10:30 am - 11:40 am
Defined-benefits pensions represent a huge financial risk for multinational companies. How do they meet them? The trend toward defined-contribution and individual pension plans has not erased the obligations of corporations to their existing and former employees. The key is how to manage these pension assets and liabilities. The traditional actuarial model, based on historical assumptions of return, has been challenged by a financial approach more in tune with the reality of markets. This roundtable explored the various facets of this issue: How can we value the risk of defined-benefits pensions? What is the risk on corporate equity? Does the return of pension-fund assets justify the use of equity? What is the risk supported by pension-fund members? Do accounting standards translate the reality of pension economics? Should this economic capital take the form of a regulatory capital?
Speakers
Denis Autier, Head of Global Risk Solutions, BNP Paribas
10:30 am - 11:40 am
Is America failing its nation′s children? The American public school system has been under attack for years. Our low test scores, compared both internationally and from state to state, are dismal. Our students are failing in math and the sciences. Schools are unaccountable. The list of complaints goes on and on. However, it′s time to stop pointing fingers at the educational system and take a hard look at the value that Americans actually place on education. According to Doloris Saunders, "We′re throwing away our children."

Panelists for the Inclusive Learning Breakout session called for all Americans to begin taking responsibility for our education system. Two recommendations in particular were to begin allocating sufficient amounts of funding to the education system, and to reframe our system and expectations in a manner that will recognize individual youth′s particular strengths and weaknesses and to take advantage of what each individual child brings to the educational table.

"We ought to expect more from schools with the support of their communities," Roy Romer said. He went on to say that without appropriate funding, the United States would continue to produce uncompetitive adults, in turn requiring the United States to continue on its current course of importing scientists. Romer argued that instead of importing talent, it was time for Americans to invest in their own infrastructure. Carlos Garcia agreed. "Today, we aren′t engaging in our communities. The failure of American education is on all of us."

In addition to failing to allocate sufficient resources to guarantee a strong public education system, Elizabeth Jimenez claims that we are failing to take advantage of the resources youth bring to the table, including language and the cultures in which youth are raised. Ms. Jimenez says, "Every child arrives to Kindergarten with five years of experience under their belt." By forcing English only education through a European lens of cultural values, youth from other cultural and linguistic backgrounds are immediately told that their experiences and cultures are unimportant.

Jimenez argues that rather than put these youth on the sidelines, our education system should incorporate their differences and experiences in order to educate all children within the public school system about the representative cultures within their own communities. Not only will this teach young people to respect differences at an early age, it will also teach young people the skills to interact in today′s global society.

In addition to the request that Americans reconsider fiscal allocation to the public education system and the current treatment of cultural differences, Roy Romer asks that all Americans consider their basic education philosophy. In order to move forward with an inclusive education system, parents, educators, administrators and students all need to believe that all children have the capability to learn.

Moderators
Jessie Woolley-Wilson, President, LeapFrog SchoolHouse
Speakers
Sheryle Bolton, President, The Indian Creek Group
Carlos Garcia, Superintendent, Clark County School District, Nevada
Elizabeth Jimenez, CEO, GEMAS Consulting
Roy Romer, Superintendent, Los Angeles Unified School District
Deloris Saunders, President, National Alliance of Black School Educators (NABSE)
10:30 am - 11:40 am
Consumers are demanding that content be delivered when they want it and on the device they prefer. This trend is defining how content providers are shaping their strategies.

"Look through the eyes of the consumer," said Kevin Conroy. "The software environment is changing to an interactive media environment." Broadband and other technologies are creating advanced content delivery options and the next five years will be critical in determining which models work.

The panel consensus was that interoperability will eventually take the place of proprietary delivery technologies. The challenge is finding a standard that all providers can agree upon.

Beyond delivery platforms, the advent of new technologies, such as personal video recorders, remote access, and Internet2, among others, have radically shaken the content business.

Mitch Singer affirmed that "you can view disruption as a threat or view disruption as an opportunity." Companies that fight new technologies will struggle in reaching the consumer. Said Singer, "We need to react to the new digital consumers."

Moderators
Dean Takahashi, Staff Writer, San Jose Mercury News
Speakers
Kevin Bachus, President & COO, Infinium Labs
Kevin Conroy, Executive Vice President & Chief Operating Officer, AOL Media Networks
Brian Farrell, President & CEO, THQ Inc.
David Goodman, President, Marketing, Infinity Broadcasting
Mitch Singer, Executive Vice President, Digital Policy Group, Sony Pictures Entertainment Inc.
10:30 am - 11:40 am
While a glass ceiling may or may not exist in corporate America, all of the panelists agreed that a more important issue was to build the self-confidence needed to be a successful business woman.

"Although men also have self-limiting beliefs, women tend to have more because of the way they were brought up," said Sherry Lansing. Even a woman of her caliber did not truly believe in herself in the early stages of her career, so she predicted that there would be no female CEO in the motion-picture business in her interview with Life magazine. The panelists said that it was only after the panelists worked on building their self-confidence that they were able to achieve their fullest potential as business people.

After Lori Underwood′s brief discussion on what made each panelist successful in her business, there was a long debate on whether a glass-ceiling still existed in corporate America. Bobbie Battista noted that, "there is still a long way to go in media business since the business still operates in old boys′ club ways." She believes that many women are opting out of corporate America to start their own businesses because of a glass ceiling. On the other hand, Sherry Lansing claimed that there is no gender discrimination in the motion picture business because in that creative business, people are judged by the quality of their work, not by their gender. When an executive reads a movie script, for example, it is hard to tell whether it is written by a man or a woman.

However, a glass ceiling can come from both external and internal sources. Regardless of any potential external glass ceiling, a woman can get what she wants in business only when she has the self-esteem to ask for what she needs and to work for things that she feels passionate about.

"You must love what you do" said Lansing. "When things do not go well, it will keep you sustained."

Moderators
Lori Underwood, Chief Membership Selection Officer, TEC International
Speakers
Bobbie Battista, Principal, Atamira Communications
Barbara Bry, CEO & Editor, Voice of San Diego
Connie Glaser, Author & Consultant
Sherry Lansing, Former Chairman and CEO, Paramount Pictures Motion Picture Group
Mary Lore, Founder & CEO, Managing Thought
Cathleen Raffaeli, President, Cardean University
10:30 am - 11:40 am
Greg Simon kicked off the session by asking the panelists, "How can I live my life as best I can until the day I die?" Although this might seem like a question that can only be answered in the spiritual sense, all four men gave thought-provoking responses founded on the fields of economics and medicine. The discussion focused specifically around muscular dystrophy, the value of medical research as well as by whom and how decisions are made regarding investments into medical research.

Chamberlain explained that muscular dystrophy is a genetic disease. Presently, there are very few treatment options; there is no cure. The average person who suffers from muscular dystrophy lives only to his or her late teens to mid-twenties. Approximately one in 1,750 babies in the world is born with muscular dystrophy; thus the disease is by no means a statistical rarity. Clearly, finding treatments and a cure for muscular dystrophy is a priority.

In attacking a disease like muscular dystrophy, the question of the value of medical research arises.

"The value of medical progress is extremely high," said Robert Topel. Practically, what this means is that, as a result of medical progress — the product of medical research — the average human life span has been lengthened by 30 years. He went on to say that if the risk of heart disease alone were lowered by a mere 10 percent, it would be worth $4.5 trillion dollars in terms of economic gain. Thus, aside from the importance of easing the suffering of people afflicted with diseases like muscular dystrophy, the financial benefit to the economy, are immense. Still, one cannot ignore the fact, Topel said, that "the nature of research is that often times, you never know what′s going to pay off." This serves to remind us that there are no guarantees in medical research that any important medical progress will be made, despite a sizable initial investment.

Research science isn′t perfect. Sometimes, enormous amounts of money are spent without resulting in enormous strides towards new treatments and cures. That leads to the question of how investment choices regarding medical research are made and by whom. Meltzer responded by stating that it was a "complicated combination of politics and good judgment." Simon agreed that politics do indeed play a powerful role in determining funding. For example, $6 billion dollars were spent creating treatments for anthrax, from which two people died, and smallpox, from which no one died, while only 5 billion dollars have been spent on cancer research, from which millions of people have died.

Influencing what diseases get researched is a system of peer review, said Jeffrey Chamberlain. He spoke of the "subjectivity" of the NIH and explained that the people who review grant applications are often motivated by what personally interests them as opposed to the interests of the country as a whole. Kevin Murphy agreed, adding that funding priorities ought to be arranged by what is of the ultimate value to the most people. Meltzer cut to the core of the issue when he spoke of the importance and challenge of weighing the value of the possible outcomes of research (i.e. longer life span and greater quality of life) with the mathematical probability that conducting research in a specific area will eventually result in noteworthy medical progress.

The questions that the panelists strove to answer today are not one dimensional; ultimately, they can all be answered from a multitude of angles, by economists and scientists alike. Placing a monetary value on human life is a complicated matter as is making decisions regarding what medical research gets funded and what doesn′t. The panel today reflected some of the work being done toward answering these questions on both practical and theoretical levels.

Moderators
Greg Simon, President, FasterCures / The Center for Accelerating Medical Solutions
Speakers
Jeffrey Chamberlain, Professor, Department of Neurology, University of Washington School of Medicine; Director, Senator Paul D. Wellstone Muscular Dystrophy Cooperative Research Center
David Meltzer, Associate Professor, Department of Medicine and Associate Faculty Member, Harris School and the Department of Economics, University of Chicago
Kevin Murphy, George Pratt Shultz Professor of Economics and Industrial Relations, University of Chicago, Graduate School of Business; Senior Fellow, Milken Institute
Robert Topel, Isidore Brown & Gladys J. Brown Professor in Urban and Labor Economics, University of Chicago, Graduate School of Business; Senior Fellow, Milken Institute
10:30 am - 11:40 am
This roundtable discussion focused on how the West Bank and Gaza can become a viable, successful Palestinian state.
Speakers
David Aaron, Director, Center for Middle East Public Policy, RAND
David Pollock, Senior Managing Director, Bear Stearns & Co., Inc.
Doug Suisman, Founder and Principal, Suisman Urban Design
10:30 am - 11:40 am
Charles Koones, president of the Variety Group, opened by stating that advertisers are facing 100 years of the most profound change in the existing value structures of the media. He then opened up the floor to the panelists posing the core question, "How do you make brands distinctive today?"

John Osborn, president of BBDO, gave a backdrop of the environment today, stating that consumers are bombarded by media from all sources and that is it not enough to merely drive awareness anymore, summing it up thus: "it′s an "and" world." Kids today are multi-tasking and thus advertisers and marketers need to deal with the media proliferation that is occurring.

Lynda Resnick, co-chairman of Roll International Corporation emphasized the importance of a quality product citing the health effects of "POM" as an example. Terry Lanni addressed the challenge of using one core product and creating a number of brands, as done by the MGM group, in order to service different markets. He did address the power of a universal brand, pointing to the opening of the new MGM Macaw in order to be more widely recognized. Joe Redling addressed the challenges in AOL′s marketing plan due to the change from dial-up to broadband. Brian Cornell talked about his new Safeway campaign and discussed how brand building works in a largely undifferentiated market. A main point agreed upon by all the panelists was that of having a quality product and experience available to the consumer, one reflecting their wants and needs.

The panelists then moved on to discuss a variety of topics. Peter Arnell raised the point we are moving away from "brands" as we know them today, and towards "evolutions" which should ideally provide some sort of "contribution to culture." Brands can′t be pushed on people via TV commercials as they once were. John Osborn quipped that yesterday′s motto was "We are what we are, therefore you should buy us." Selling products today depend increasingly on customer satisfaction of the product. Lynda Resnick summed it up thus: "It′s all about product integrity." The panelists touched on the increasing tech-saviness of youth and how reaching audiences is changing accordingly. Joe Redling pointed out that media online is growing and increasingly measurable, and that more branding work needs to be done online. The panelists then touched on innovation, digital networks, and going forward in branding today. The general consensus was that at the end of the day, branding should "meet consumer needs and reach them in the most efficient way," thus closing the gap between consumer behavior and what consumers really want.

In his final remarks, Peter Arnell said that "Authenticity is the issue and it is the new cool," thus projecting a departure from branding and marketing in the past to a new socially conscious type of marketing. The other panelists concurred and projected the future of branding to include digital media, an increase in brand integrity and challenges in worldwide marketing of brands.

Moderators
Charles Koones, President / Publisher, The Variety Group
Speakers
Peter Arnell, Chairman and Chief Creative Officer, Arnell Group
Brian Cornell, Executive Vice President, Chief Marketing Officer, Safeway, Inc.
J. Terrence Lanni, Chairman and CEO, MGM MIRAGE
John Osborn, President & CEO, BBDO New York
Joe Redling, Chief Marketing Officer, America Online, Inc.
Lynda Resnick, Co-Chairman, Roll International Corporation
11:50 am - 1:45 pm
A chemist, a physician, and a physicist walk into the room... It′s not the set up for a joke, but rather the beginning of an entertaining luncheon panel with three Nobel Laureates and moderator Michael Milken on the final day of the Global Conference. The men engaged in a discussion about science, technology and the future, or, as Milken described it, "what gets three young men excited in life." Punctuated by jokes, anecdotes, and a friendly rivalry between the sciences, the three Nobel Laureates described the events and influences that led them into their respective fields.

After describing what drew them to science, the panelists were asked to discuss creativity and offer some thoughts about where their ideas come from. George Olah noted that he is afforded room to pursue his interests at USC: "I never try to give any advice to the football coach, and in return, USC is not too interested in what I am doing." He reminded the audience that one can do much with relatively limited means, because "it′s ideals that count a lot."

The topic of DDT, a very effective pesticide for killing mosquitoes, among other uses, was brought up as an example of a solution to a problem that created unintended, negative consequences. The panelists addressed the tradeoffs involved with the use of substances like DDT, which is credited with saving many lives, but also found to have deleterious side effects.

The scientists also referred to former Vice President Al Gore′s global warming presentation, and Douglas Osheroff noted that he agreed with many of Gore′s conclusions about the existence of a problem. Osheroff and Olah engaged in a minor debate about the best solutions, but both agreed that there is a need for increased conservation and more efficient cars.

Milken posed a question to Gerard Edelman about the human brain, asking whether it continues to grow as we get older. Edelman explained that there is a complex relationship between the body, the brain, and the environment in which the two are integrated. Milken surmised from his explanation that it is not possible to switch brains to a different body, to which Edelman responded, "I wouldn′t recommend it, not even in my case." Every brain is unique because the wiring is based on our individual experiences, and the brain is constantly developing. Osheroff brought up the possibility of using what scientists have learned about the human brain to establish a more effective educational system.

The luncheon panel concluded with each Nobel Laureate describing what topics are exciting to each of them at present. Edelman spoke about the possibility that, within 50 years, scientists may have created a conscious artifact (artificial intelligence). Olah said that he is most excited about the potential of the methanol economy. Osheroff is very concerned about the problems associated with global warming, but he is excited about ongoing research into dark matter and dark energy.

"One thing is for sure," Milken told the crowd, "The future is going to be very exciting."

Moderators
Michael Milken, Chairman, Milken Institute; Chairman, Prostate Cancer Foundation; Chairman, FasterCures / The Center for Accelerating Medical Solutions
Speakers
Gerald Edelman, Nobel Laureate, Medicine, 1972; Director, Neurosciences Institute; Chairman, Department of Neurobiology, Scripps Research Institute
George Olah, Nobel Laureate, Chemistry, 1994; Distinguished Professor and Donald P. and Katherine B. Loker Chair in Organic Chemistry, University of Southern California
Douglas Osheroff, Nobel Laureate, Physics, 1996; Professor of Physics and Applied Physics, School of Humanities and Sciences, Stanford University
2:00 pm - 3:15 pm
Panelists here explored issues affecting the face of Islam and the West′s role in Islamic countries.

The West has paid greater attention to Islam since the September 11th attacks. These attacks, however, are thoroughly inconsistent with Islam and should not be interpreted as a prevalent facet of Islam, the panelists agreed. As Engin Ansay noted, "Terrorism has nothing to do with religion. In every religion there are criminals."

Overall the West has a distorted perception of Islam, often equating it with fundamentalism. Instead, panelists agreed that the serious clash is not between Islam and the West, but rather lies within Islam. This dynamic has played out across the globe, including Saudi Arabia, Afghanistan and Pakistan. These societies are wrestling with deep internal divisions regarding what type of Islam—fundamentalist, moderate or somewhere in between—they want. This debate largely turns on differing views about the role of women in society. Moreover, recent U.S. foreign policy, such as the bombings in Afghanistan, the war in Iraq and the U.S. role in the Palestinian-Israeli conflict has affected Muslim perceptions of the U.S. Many Muslims initially viewed the West′s actions as attacks on Islam. But panelists agreed that this perception is slowly changing and that debate within Muslim countries is increasing.

Panelists cautioned against seeing democracy—as symbolized by elections—as the antidote for extremist Islam, however. Panelists perceive democracy as a process, not as an event or an election. As Siddiqui noted, "Democracy cannot be implemented by sword." The democratic process must include a transparent judiciary, property rights, fair distribution of wealth, civic institutions, education systems, voter training and a free press, among others things.

The end of the cold war and the United States′ status as the sole superpower has made the West′s relationship with Islam increasingly complicated and contentious. Bronson posited that while the fall of the Berlin Wall encouraged local figures in formerly communist countries to compete in the political arena, the reality in the Islamic world was different. The Iraqi invasion of Kuwait consumed Islamic countries′ attention and resources. As such, the democratic process in most Islamic countries continues to differ from other developing countries.

In the long run, panelists concurred that economic development is central to political stability in Islamic regions, as well as to minimizing the presence of extremist Islam. The panel noted that in Gaza, for example, unemployment is about 75 percent. Moreover the distribution of wealth in many Muslim countries is dramatically unequal, which encourages the younger population to look to extremism as they feel it is the only arena that offers an explanation and solution. As Ansay stated, "We need to address the inequalities first, bring in the democratic process, and then there will be no difference between Islam and the rest of the world."

Moderators
Joshua Hammer, Correspondent, Newsweek
Speakers
Engin Ansay, Consul General of Turkey in Los Angeles; formerly Turkey's Permanent Observer of the Organization of the Islamic Conference (OIC) to the UN
Rachel Bronson, Senior Fellow and Director, Middle East and Gulf Studies, Council on Foreign Relations
Isobel Coleman, Senior Fellow, U.S. Foreign Policy, Council on Foreign Relations
Imam Ali Siddiqui, Khatib, Muslim Congregational Leader
2:00 pm - 3:15 pm
Improving access to and affordability of post-secondary education for minorities is essential to increasing America′s human capital in the 21st century. Demographic changes in America′s labor supply combined with technological and economic changes in firms′ demand for labor present challenges to educators and society. Demographers project that by the year 2050 America′s workforce will be one-quarter Latino and over half ethnic workers. Meanwhile estimates of the labor market in 2050 indicate that eight out of 10 jobs will require post-secondary education. The success of America′s economy in the 21st century is dependent on our ability to match the changing labor supply with the future labor demands through education.

According to panelist Michael Lomax, financial impediments are the primary reason the minority students he works with do not complete college. The increasing cost of tuition is pricing many minorities out of the market for education. In addition to the financial burden of post-secondary education, the value society places on minorities, impacts their success. Lomax asserts, "we have viewed minorities as the brawn and not the brain in this culture."

Another topic discussed by the panel were the failures of traditional private and public universities. These included rising cost of tuition, low graduation rates and the inability to match graduates with employment. Nicholas Glakas presented the alternative of profit-based colleges, which tend to serve older students. These schools attempt to match the needs of the economy with the school′s curriculum and have shown excellent employment statistics for graduates. "Every one of our schools that opens up is inundated with applicants," Glakas asserted.

The recommendations presented by the panel included embracing technology, improving options for financing education and valuing diversity. While the discussion centered on post-secondary education, improving K-12 education was mentioned by panelists as critical in preparing America for the 21st century.

Moderators
Cathleen Raffaeli, President, Cardean University
Speakers
Adam Chavarria, Executive Director, White House Initiative on Educational Excellence for Hispanic Americans
Nicholas Glakas, President, Career College Association
Edward Guiliano, President & CEO, New York Institute of Technology
Michael Lomax, President and CEO, United Negro College Fund
Catherine Reynolds, Chairman and CEO, Catherine B. Reynolds Foundation
Ted Sanders, Former President, Education Commission of the States; former Acting Secretary of Education
2:00 pm - 3:15 pm
Technological innovation and changing consumer habits are revolutionizing the way news is gathered and disseminated. News cycles are 24/7. Tens of millions of Americans now look first to the Internet for their information needs. Can the traditional system of educating and training journalists keep apace? In this roundtable discussion, a group of forward-thinking newsroom executives and leading journalism educators explored the rapidly evolving skill set that is required for reporters and editors.
Speakers
Geoffrey Cowan, Professor and Dean, Annenberg School for Communication, University of Southern California
Howard Finberg, Director, Interactive Learning, The Poynter Institute
Richard Taylor, Global Head of Learning for News & Data, Reuters
2:00 pm - 3:15 pm
If content was king, has the balance of power shifted between content and distribution? In the past, the marriage of content and distribution has generally been a success. But as markets move toward emerging trends and new technologies, moderator Mark Leavitt asked "What next?"

Chase Carey kicked off by noting that distribution markets have ebbed and flowed with content, but the quality of distribution and market share determine success. Content has to be part of the equation to compete, but by providing it with a level of excellence and quality distinguishes you. At the end of the day, if you want to be a part of a great TV company, it′s about content and programming.

Jon Feltheimer suggested that the power is with the consumer and when content providers create what the consumer wants and the distributors packages it right, the consumer wins. People have much more choice and expect more. This has affected profound change in the industry to the point that Mel Karmazin noted there one does not exist without the other. If you are in the content business, you want it to be distributed everywhere and in every mode. As there is no way for any company to own all distribution, it is vital to create compelling content.

Yair Landau, speaking from a content perspective, echoed Karmazin and added that filmmakers and talent work with Sony Pictures in large part because of its distribution network. He purported that strong distribution enhances the economic value of content, to which Jonathan Miller added that content becomes part of an overall experience and is constantly evolving.

Leavitt asked the panel what movies will look like 10 years from today. Landau asserted that the theatrical experience will stay, although technology needs to advance to make it competitive with home entertainment. Landau and Feltheimer agreed that the value of movies will continue to be based on box officer receipts, but Carey pointed out that the increased flexibility and efficiencies in electronic distribution can opportunistically change that.

As greater distribution avenues evolve, the consumer has every opportunity to get what they want, where, when, and how they want it. As new technologies emerge, content creation can follow an increasingly innovative path. The impact of technology and new competition has different effects, largely based on the cost of distribution. With the ubiquitous placement of products at retailers like Target and Walmart, distribution is impacting how content is consumed and created. Landau asserted that these days, children see more by the time they are eight-years-old than most adults have seen in the past 30 years. He claimed that distribution is about how you market and package the content.

Feltheimer added that this is an opportunity to raise brand awareness by creating a relationship with the consumer that might not have been present before. Carey further suggested that this is an opportunity to download targeted product as a value-added proposition. To support this point, Miller noted that AOL partnered with Universal to work with artists on exclusive distribution mediums for their music videos. Karmazin piped in that Comcast partnered with Sony to buy MGM assuming that it will get a seat at the table when the window opens up for video-on-demand.

Landau pointed out that in response to the piracy threat to content providers, it is in the best interest of all to promote legitimate pay-downloads. Miller added that you can′t prevent content from getting out there, companies have to be able to monetize that experience. Consumers want to do it in a legitimate way, but without those outlets, they will move toward whatever environment is available, such as BitTorrent. Landau noted that while IP delivery is an issue these days, how to ultimately get the content onto television is still a hurdle. TV, he said, is still the home choice for viewing content.

On the issue of whether digital video recorders are a threat to advertisers, Karmazin responded that it′s up to companies to figure out how to get advertising out. Skipping through commercials is no different than skipping through the advertisements in print media, he noted. In a way, it is a more level playing field that is has been in the past.

In closing, while there are no clear answers to where the balance of power lies between content and distribution, there is evidence that the balance will be based on creating compelling content and pushing that content through strong distribution.

Moderators
Mark Leavitt, Managing Director, Jefferies & Company, Inc.
Speakers
Chase Carey, President and CEO, DIRECTV
Jon Feltheimer, CEO, Lion's Gate Entertainment
Mel Karmazin, CEO, SIRIUS Satellite Radio
Yair Landau, Vice Chairman, Sony Pictures Entertainment; President, Sony Pictures Digital
Jonathan Miller, Chairman and CEO, America Online, Inc.
2:00 pm - 3:15 pm
"Mexico is a country of paradoxes," declared Jorge Hierro. "We have oil sitting in the ground, and a lot of savings." And yet, the U.S.′ southern neighbor also has great social problems and is seemingly without the money to fund solutions to them.

Jorge Castaeda, a candidate for the Mexican presidency, believes he has an answer: create a North American Energy Fund (NAEF) that issues securities backed by oil revenues, and use the invested capital to fund oil exploration and a Mexican Development Fund to reduce poverty, create jobs, and improve criminal justice and education.

"The idea comes from a simple equation," he explained. "Mexico has a lot of oil... and enormous social needs. We should export more oil." Castaeda added that his plan has benefits for the U.S., which would be able to import oil from Mexico instead of from the less stable and less democratic nations that it currently relies on.

Castaeda estimates that the NAEF will require between $65 and $75 billion, and expects it to double Mexico′s oil exports in five years. He hopes that institutional investors — at least some of whom will come from the U.S. — will help fund the venture.

But there are difficulties. The Mexican population has had many experiences with government corruption, Jos Alberro asserted, and may prefer the oil in the ground, where it cannot be stolen. "It is only going to be credible if... it abides by the rules of transparency." To further these goals, both the NAEF and the MDF will have independent board members, and will be autonomous from the state-run oil company, PEMEX.

Even if the program succeeds in gaining approval, however, it remains saddled with the highly inefficient PEMEX to conduct exploration, production and refining. This raised the question of why they don′t open the market to private competition, instead of attaching the plan to PEMEX?

"One word," exhorted Alberro, "Con-sti-tu-tion." The Mexican Constitution, he explained, does not allow any private interests to own Mexico′s oil.

Still, panel members were optimistic about the prospects for the NAEF. "I think the profitability is there," said Alberro. The trick, he stated, is "to create a financial instrument that can take into account these risks."

Aside from offering high returns in return for the risks, Castaeda pointed out that Mexican debt backed by future oil revenues have been used before. More importantly, they worked. He cited the U.S. bailouts of the Mexican economy in 1982 and 1995 as examples.

If the program succeeds, it could mean a more stable, economically secure Mexico and improved quality of life for its people. "What we have to do is put this together and get elected," summarized Castaeda.

Moderators
Nathan Gardels, Editor, New Perspectives Quarterly
Speakers
Jose Alberro, Director, Law and Economics Consulting Group (LECG)
Jorge Castañeda, Professor, Graduate School, Department of Political Science, National Autonomous University of Mexico; former Mexican Foreign Minister
Claire Farley, CEO, Randall & Dewey Partners, LP
Jorge Hierro, Executive Director, Institutional Relations, Financial Group, Citicorp/Banamex
2:00 pm - 3:15 pm
What are the factors that lead to aging and loss of mental function? This roundtable examined the genetic, nutritional and behavioral aspects of aging, as well as the loss of mental function from day-to-day memory loss due to Alzheimer′s disease. Gary Small, an expert in training people to remember, discussed his findings on how to improve your memory.
Speakers
Gary Small, Director, University of California, Los Angeles Center on Aging
Gary Small, Director, University of California, Los Angeles Center on Aging
Gary Small, Director, University of California, Los Angeles Center on Aging
2:00 pm - 3:15 pm
Sometimes, it′s what you don′t know that can be most dangerous, particularly when it comes to vital legal issues for families involving tax and estate planning, real estate transactions, business-succession planning, personal and business litigation, and forming, buying, operating, merging and selling businesses. This roundtable discussion touched on the most important issues for you and your children when dealing with labor and employment compliance requirements, regulatory issues involving your residence, campaign finance reporting, philanthropic disclosure requirements, pre- and post-nuptial agreements, and guarding intellectual property.
Moderators
Timothy Lappen, Chairman & Founder, Family Office Practice Group, Jeffer, Mangels, Butler & Marmaro LLP
2:00 pm - 3:15 pm
A pen that's a computer? Conference sponsor LeapFrog Enterprises will demonstrate its latest product, called "Fly," a pentop computer that can read handwriting, solve math questions and talk back to its user. The device, aimed at 8-to-13-year-olds, is equipped with computer electronics, enabling it to "read" handwriting or even drawings made on paper.
3:25 pm - 4:30 pm
Famed futurist Alvin Toffler, author of Future Shock, War and Antiwar, Powershift: Knowledge, Wealth, and Power at the Edge of the 21st Century and The Third Wave, was interviewed by Milken Institute Senior Fellow and UCLA Professor Michael Intriligator about his views on what lies beyond the third wave of the information revolution, following the first wave of the agricultural revolution and the second wave of the industrial revolution, and what we might expect over the next several decades in the global economy and society.
Moderators
Michael Intriligator, Senior Fellow, Milken Institute; Professor of Economics, Political Science and Policy Studies, University of California, Los Angeles
Speakers
Alvin Toffler, Author, Futurist
3:25 pm - 4:30 pm
In many communities, access to higher education is limited. But with today′s Internet technology and the growth of distance-learning institutions, many of these underserved populations can now get the education they need to become part of today′s skilled workforce. Panelists on this roundtable represent minority communities that are underserved by post-secondary educational institutions and can benefit economically from greater access to educational opportunities. Participants discussed how distance education is a tool to help these underserved populations, ways to create wider access to higher education and how society will be improved with expanded access to education.
Moderators
Ramon Gregory, Executive Vice President, Enrollment and Student Services, Cardean Learning Group
Speakers
Edward Brewington, Senior Vice President Human Resources, Knowledge Learning Corporation
Carl Brooks, President, The Executive Leadership Council
Adam Chavarria, Executive Director, White House Initiative on Educational Excellence for Hispanic Americans
Maria Contreras-Sweet, President and Co-Founder, FORTIUS Holdings, LLC; former California Secretary of Business, Transportation and Housing
Michael Lomax, President and CEO, United Negro College Fund
John Mack, President, Los Angeles Urban League
3:25 pm - 4:30 pm
The family unit can be viewed as an enterprise with multiple stakeholders, claimants, owners and managers. Some are actively involved with the family enterprises, some aren′t. They have different goals. Today, it′s possible to create structures, and even "family securities," to optimize the value and permanence of the family unit. This discussion will focus on such issues as: Can a family define different returns among different family members? Can some family members allocate to lower-risk vehicles while others seek riskier returns, all under the same enterprise? Can a structure be designed on a "family-by-family" basis to create harmony within the growing multi-generational family and to enable the family to accomplish its many goals (harmony, fidelity, legacy, wealth creation, philanthropy) efficiently and effectively?
3:25 pm - 4:30 pm
Will an economic roadmap to peace succeed in the Middle East where multiple political roadmaps have failed?

Jafar Hassan, Abraham Sofaer and Moshe Tery say yes. These three distinguished panelists agreed that private finance is the key to developing infrastructure, spurring education and human resource development, expanding production and export regions and providing significant access to capital in Israel and Palestine particularly, and the Middle East, generally.

"Capital markets represent the point at which finance, enterprise and knowledge are each efficiently allocated," said Moshe Tery.

As such, the panelists presented economic development plans for both Israel and Palestine to open their economies to capital flows, develop infrastructure and move toward a peaceful, regional relationship.

Tery set forth a comprehensive Israeli economic development plan to move toward integration with the world economy as a way to begin developing peace within the region. According to him, "Countries that do business together do not fight each other." As such, the Israeli government and security council have been attempting to open the Israeli economy by adopting international accounting standards, standardizing its security laws according to accepted international standards, adopting corporate governance codes, reducing tariffs and trade barriers, and implementing structural changes.

Similarly, Jafar Hassan spoke to the Jordanian focus on the development of Palestinian infrastructure in order to help broker peace in the Middle East. According to Hassan, Jordan′s focus on Palestine is centered on two priorities: the upcoming Palestinian elections in July and Israeli disengagement. Hassan believes the new Palestinian Authority will support infrastructure development in Palestine, which in turn will lead to loans to the Palestinian state to develop infrastructure such as water management, electricity and housing.

On the other hand, Abraham Sofaer suggested that while an economic roadmap presented more tangible outcomes than any previous political roadmap to peace had, in order to achieve any real progress on an economic plan, it would remain essential that the governments of both Israel and Palestine support the reforms and agree to not only peace, but to a collaborative approach at economic development within the region. Beyond government support and cooperation, Hassan added that it was essential that the people of the region believe economic development will lead to sustainable peace within the region.

Moderators
Glenn Yago, Director, Capital Studies, Milken Institute
Speakers
Jafar Hassan, Deputy Chief of Mission, Embassy of Jordan
Abraham Sofaer, George P. Shultz Senior Fellow, Foreign Policy and National Security Affairs, Hoover Institution
Moshe Tery, Chairman, Israel Securities Authority
3:25 pm - 4:30 pm
Hilary Rosen condensed the theme of the session into one sentence when she remarked "You can′t stop piracy." It seems the pessimistic and realistic views of media piracy have combined to form one outlook that implies a future of uncertainty for the entertainment business. Rapidly evolving technology and consumer taste for content have led to piracy increasing at an exponential rate. The question posed to the panel: how will the entertainment industry react?

Moderator Dennis Kneale laid the foundation of the session in technology. With groundbreaking developments in I2, IPTV and bandwidth only a few years away, the entertainment business′ current inability to combat media piracy suggests industry turmoil in the near future. Barry Meyer pointed out that pirated DVDs of Harry Potter were being sold in front of the theatre at the China premiere; the industry was unable to protect the print before it even premiered. Furthermore, Robert Kotick pointed out that any success in this field is only a, "brief reprieve until we master massive data transfers," at which point media will have a pirated debut worldwide over the Internet.

Kneale and Rosen agreed that part of the piracy problem was attributable to current media content. File sharing programs like Napster and Kazaa have gained popularity among users interested in downloading an album′s one or two hit songs instead of buying the entire CD with an additional 10 songs of filler. Rosen asserted, "Our customers wouldn′t get mad if we were serving them well." Meyer and Michael Lynton disagreed, subscribing to the traditional view of intellectual property piracy being wrong regardless. They suggested that content was irrelevant and harsh repercussions would solve the problem. Kneale played devil′s advocate and countered, "Why don′t you bust a few kids in Singapore and cane them as well?"

All of the panelists agreed that the evolution of piracy has redefined the significance of ownership of intellectual property: if it can′t be enforced, it simply becomes a titular formality. Whether the solution to the problem lies in content, punishment or a combination of the two, panelists all believed that failure to curb the growing threat would cripple the entertainment industry as we know it.

Moderators
Dennis Kneale, Managing Editor, Forbes magazine
Speakers
Peter Chernin, President and Chief Operating Officer, News Corporation; Chairman and CEO, Fox Group
Robert Kotick, Chairman and CEO, Activision, Inc
Michael Lynton, Chairman and CEO, Sony Pictures Entertainment
Barry Meyer, Chairman & CEO, Warner Bros. Entertainment Inc.
Hilary Rosen, Consultant; former Chairman and CEO, Recording Industry Association of America (RIAA)
4:30 pm - 5:30 pm
4:30 pm - 5:30 pm