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Speaker 1: Welcome to Fear and Greed business news you can use today.

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Speaker 1: China puts a temporary ban on BHP's iron ore exports,

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Speaker 1: triggering fears of shortfalls for the big Australian's earnings and

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Speaker 1: the federal budget. Australia's biggest car dealership pushes into Canada

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Speaker 1: and analysts tip rising house prices in coming months. Plus

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Speaker 1: the battle over seven Western Southern Cross media starts getting dirty,

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Speaker 1: and President Donald Trump and Defense Secretary Pete Hegsath lecture

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Speaker 1: the US Lecture The US is top military brass on

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Speaker 1: grooming and physical fitness. It is Thursday, the second of

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Speaker 1: October twenty twenty five. I'm Michael Thompson and good morning,

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Speaker 1: Sean Aylmer.

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Speaker 2: Good morning, Michael. That last story you mentioned it is

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Speaker 2: it is pretty remarkable. We'll get to it.

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Speaker 1: Yeah, we will get to that one a bit later.

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Speaker 1: On the main story this morning, Sean. China has put

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Speaker 1: a temporary ban on BHP's iron ore shipments into the

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Speaker 1: country after talks over the renewal of contracts broke down

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Speaker 1: and what's considered really an active brinksmanship by Beijing.

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Speaker 2: The embargo was imposed after discussions between the mining giant

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Speaker 2: and China Mineral Resources Group stalled, according to a Bloomberg report,

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Speaker 2: obviously bad news given that China buy more than one

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Speaker 2: hundred about one hundred and eight billion dollars worth of

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Speaker 2: iron ore from Australia every year. Prime Minister Anthony albany

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Speaker 2: is Easy yesterday got involved that he's worried about the

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Speaker 2: news and called for a quick resolution between BHP and China,

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Speaker 2: urging an end to hardball negotiations. Federal treasure Jim Chalmers

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Speaker 2: was expected to call BHP boss Mike Henry over the issue.

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Speaker 2: The dispute is seen as an attempt by CMRG, the

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Speaker 2: Chinese buyer, to gain leverage over BHP, and is thought

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Speaker 2: to revolve around the discount applied to medium grade or

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Speaker 2: sold by the Big Australian. It's unclear whether it's only

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Speaker 2: for spots sales of iron ore or currently contracted sales.

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Speaker 2: HP wasn't commenting yesterday. The refusal of shipments could result

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Speaker 2: in cargoes worth millions of dollars remaining unloaded, incurring hefty

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Speaker 2: shipping related expenses, and leaving BHP's mining operations in Western

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Speaker 2: Australia's Pilburgh region in Limbo. Bhpre's share price yesterday fell

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Speaker 2: two point five percent as a result.

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Speaker 1: Sean iron Ore is now really it's fundamental to Australia's economy.

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Speaker 1: It's our biggest export earner, not just for BHP but

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Speaker 1: for the federal government. Given the minor pays plenty of

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Speaker 1: money in taxes. China's our biggest buyer. Is this kind

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Speaker 1: of thing typical or should we be more worried about this? Look?

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Speaker 2: I think we should be a little bit more worried.

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Speaker 2: As I mentioned, Australia probably exported about one hundred and

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Speaker 2: eight billion dollars with mine or last year. What's happening

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Speaker 2: in China is part of the it's negotiating tactics, but

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Speaker 2: China is getting better at negotiating this group. The CMRG

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Speaker 2: was established three years ago to improve China's a bill

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Speaker 2: to deal with minus such as BHP and Brazil's Varalet,

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Speaker 2: which is actually the world's biggest producer iran Or. It

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Speaker 2: acts as both a trader and strategic reserve, so it

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Speaker 2: has stockpiles at more than a dozen ports across China.

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Speaker 2: It releases that stockpile when mills are struggling buyers aggressively

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Speaker 2: when prices dip. Since its creation, CMRG has grown into

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Speaker 2: the single most powerful buyer in the global market. It's

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Speaker 2: backed by the Chinese Communist government, represents more than half

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Speaker 2: of China's vast steel industry. Therefore, it is in a

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Speaker 2: much stronger negotiating position when it's dealing with BHP, Rio,

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Speaker 2: et cetera than ever before. So that's why we should

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Speaker 2: be a little bit more worried about it this time now. Rio. Yes,

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Speaker 2: they refuse to say whether it had also been dragged

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Speaker 2: into the dispute, while Pilbra minus Fortescue Metals and Handcock

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Speaker 2: iron Ore also declined to comment. Mineral Resources, a smaller

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Speaker 2: Pilber producers, that it wouldn't be affected by the dispute.

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Speaker 1: It seems a very good time to mention today's interview, Sean,

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Speaker 1: that you've got coming up after the show Fear and

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Speaker 1: Greed Q and A. Today it features Junebailu, who is

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Speaker 1: the co founder and lead portfolio manager at investment firm

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Speaker 1: ten Cap, and you begin by asking her about BHP.

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Speaker 2: Yeah, exactly right, we asked when I asked Jinbei about

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Speaker 2: BHP's prospects, also about other Chinese exposed companies like A

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Speaker 2: two Milk. Then we go into some of the local stocks,

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Speaker 2: from the high flyers, the Harvey Normans of the world

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Speaker 2: and the Life three sixties of the world through to

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Speaker 2: the not so high flyers like Domino's Pizza. We also

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Speaker 2: have a quick chat about Sigma Healthcare plenty in it.

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Speaker 1: Yeah, great one for investors. It is coming up after

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Speaker 1: the show, so stick around for that one shown. The

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Speaker 1: local market yesterday was dominated by China and all the miners,

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Speaker 1: not just BHP. Lithium stocks were sold off in early

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Speaker 1: trading following reports that Chinese authorities have approved increased production

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Speaker 1: from two major lithium producers in that country. As a result,

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Speaker 1: we had Liontown, Pilbrim Minerals, Mineral Resources, and Igo. They

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Speaker 1: all fell.

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Speaker 2: That's right. The flip side was the gold stocks. Gold

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Speaker 2: hit another record, extending a four day rally as traders

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Speaker 2: braced for a possible US government shut down that supports

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Speaker 2: demand for safe haven assets. Bullion touched three thousand, eight

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Speaker 2: hundred and seventy five dollars and fifty three cents US dollars.

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Speaker 2: Of course, announce that meant local stocks like Neumont, Northern Star,

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Speaker 2: Evolution Mining, Genesis Mining, they kind of outperformed West Gold

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Speaker 2: Resources announced plans to increase annual gold production from three

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Speaker 2: twenty six thousand ounces to more than four and seventy

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Speaker 2: thousand ounces. That's quite a jump when you've got a

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Speaker 2: goal price heading towards four thousand US dollars a ton.

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Speaker 2: Its share price jumped eleven percent by the close, though

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Speaker 2: the SPA six two hundred was pretty flat. Corporate news

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Speaker 2: a couple of interesting ones. Drone Shield jumped another twenty

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Speaker 2: three percent. It's reason about fifty percent this week. That's

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Speaker 2: a company that makes defense mechanisms. That the right word done,

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Speaker 2: defense stuff for drones, and everyone likes that at the moment,

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Speaker 2: given what's going on in the world. Brava's Solutions surged

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Speaker 2: nearly twenty percent after upgrading its earnings. Guidance and Nostile

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Speaker 2: Chairs jumped after it reached an agreement with the US

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Speaker 2: Navy its toeing selvage and rescue ship program.

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Speaker 1: How to you describe it as defense stuff?

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Speaker 2: I did? I did, like say, drone defense.

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Speaker 1: Yeah, I suppose it is. I mean, every day we

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Speaker 1: have this same discussion, there's this same kind of question

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Speaker 1: over how to act accurately describe what drone Shield does.

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Speaker 1: The clue is like, it's all in the name, right,

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Speaker 1: it is a shield.

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Speaker 2: But you can't say drone shield which produces shield against dranes.

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Speaker 1: No, because then we'll look like then we'll look like

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Speaker 1: a pair of geese sewn, and we wouldn't want that.

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Speaker 2: Geese probably are a good defense against drones.

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Speaker 1: Send up, Send up the flock. Anyway, let's take a

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Speaker 1: quick break back in a moment with the rest of

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Speaker 1: the day's business news sew in. Australia's biggest car dealership,

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Speaker 1: Eagers Automotive, will buy sixty five percent of North American

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Speaker 1: Network Canada One for one point one billion dollars.

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Speaker 2: Eggers is putting in one billion dollars in major shareholders.

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Speaker 2: Nick Politis is tipping in another one hundred and twenty

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Speaker 2: eight million dollars. Remaining thirty five percent of the business

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Speaker 2: will be held by the current owner and founder, a

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Speaker 2: guy called Pat Priestner, analyst said Canada's car market is

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Speaker 2: fifty percent bigger than Australia, much higher margins. That's why

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Speaker 2: Nick Politis and Egers is interested in getting into it.

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Speaker 2: Plytus owns thirty percent of eagas already, he's a director.

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Speaker 2: He's also chairman of Sydney Rooster's drugbia Legu Club. He

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Speaker 2: first bought a steak in Eagers in two thousand after

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Speaker 2: the death of majority shareholder Alan Piper, and has made

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Speaker 2: a lot of money from that company, particularly in recent months.

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Speaker 2: Eagers will pay six hundred and fifty eight million dollars

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Speaker 2: in cash for the steak, largely funded by equity raising.

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Speaker 2: The deal gives Capital Canada one an enterprise value of

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Speaker 2: two point seven billion dollars.

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Speaker 1: Property price is sewn in suburbs that are popular with

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Speaker 1: first home buyers will jump more than predicted by Treasury

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Speaker 1: modeling after the rollout of the government's new five percent

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Speaker 1: deposit scheme. This is according to economists and mortgage brokers.

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Speaker 2: Labour's election commitment took effect on Wednesday, expanding the first

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Speaker 2: Home guarantee so first buyers can avoid paying Linda's mortgage

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Speaker 2: insurance with deposits as low as five percent. The changes

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Speaker 2: also abolished income limits, which is a big part of it.

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Speaker 2: Treasury estimates it will make seventy thousand people eligible in

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Speaker 2: the first year from the start date, up from fifty

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Speaker 2: thousand people according to the AFR Now the mas SEAD

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Speaker 2: quotes a number of agents saying demand in the first

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Speaker 2: couple of days was unprecedented, so it has totally opened

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Speaker 2: up the market to first home buyers. That's good news

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Speaker 2: if you're a first home buyer, not so good if

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Speaker 2: you're not a first home buyer trying to get into

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Speaker 2: the market.

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Speaker 1: Jehan, I reckon most people listening to this show and

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Speaker 1: listening over the last couple of weeks wouldn't be able

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Speaker 1: to tell that you are working remotely, that you are broadcasting,

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Speaker 1: that you were recording this podcast from the other side

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Speaker 1: of the world in the south of France, until we

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Speaker 1: suddenly get to a story that shows just how much

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Speaker 1: your body clock is completely out of whack, as it

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Speaker 1: was just then when you referred to the first home

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Speaker 1: by a scheme coming into effect on Wednesday yesterday, and

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Speaker 1: you have no idea what time it is, what day

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Speaker 1: it is, or anything. You are working very strange hours right.

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Speaker 2: Now, very odd hours, I must say.

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Speaker 1: Anyway, that was a very long winded way of pointing

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Speaker 1: out that Wednesday was in fact yesterday, Sean. And that

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Speaker 1: information comes in a week in which data shows home

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Speaker 1: price growth in Australia it's accelerating, and after Reserve Bank

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Speaker 1: Governor Michelle Bullock said three rate cuts this year have

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Speaker 1: already flowed through to the housing market.

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Speaker 2: Is Michael, you ran in the strong auction results for

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Speaker 2: both cities and regions. Bottom line, I reckon In all,

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Speaker 2: this housing market looks pretty warm at the moment.

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Speaker 1: Indeed toasty now. The seven West Southern Cross Media deal,

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Speaker 1: which was announced on Tuesday, which was the day before yesterday, sean,

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Speaker 1: it's already getting ugly. It didn't take long, did it.

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Speaker 1: With a big shareholder in Southern Cross trying to scupper

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Speaker 1: the deal.

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Speaker 2: Sand And Capital, which owns more than eleven percent of

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Speaker 2: Southern Cross, sent the Border a quest to amend the

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Speaker 2: company's constitution on Tuesday night. As it stands, Southern Cross

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Speaker 2: shareholders don't get a vote on the merger. And Sander's

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Speaker 2: managing director, Gabriel Redsminski, who'd described the deal as diversification,

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Speaker 2: great word dwrsification diversification. Once it changed, Southern Cross Media's board,

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Speaker 2: said it's confident can stop any attempt to change its constitution.

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Speaker 2: The push to change the constitution cold is successful. Stuff

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Speaker 2: up the merger, that's if it does require shareholder approval.

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Speaker 2: Stay tuned for that one. The other media announcement yesterday, Michael,

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Speaker 2: would you'd be much more across? Is the regulators ruling

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Speaker 2: on what's going on with the kiss Kyl and Jackieasha?

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Speaker 1: Ah, Yes, yeah, the regulator ACMA did not take too kindly.

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Speaker 1: I think it was something like this is now that

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Speaker 1: the twelfth breach finding against the program. There were seven

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Speaker 1: new breaches within this about vulgar and sexually explicit content

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Speaker 1: and failure to handle audience complaints within the required time

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Speaker 1: as probably not going to help Kyl and Jackieo's push

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Speaker 1: to gain market share in Melbourne where it just hasn't

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Speaker 1: been able to really gain much ground at all over

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Speaker 1: the last eighteen months. But if we turn away now

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Speaker 1: from local media to an international story show returning to

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Speaker 1: international news now. The US government has officially shut down

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Speaker 1: after Republicans and Democrats failed to reach an agreement over

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Speaker 1: funding bills.

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Speaker 2: From midnight Tuesday US time or two pm yesterday Australian

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Speaker 2: Eastern Standard time. Hah, I'm getting my time worked out, Michael.

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Speaker 2: There you go. Hundreds of thousands of public service workers

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Speaker 2: will be put on forced holiday. It directly effects about

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Speaker 2: seven hundred and fifty thousand federal workers daily cost of

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Speaker 2: four hundred million UIST dollars. Essential workers will have to

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Speaker 2: work without pay. It's not a totally uncommon occurrence, and

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Speaker 2: last time Donald Trump was in power, there was a

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Speaker 2: thirty four day shutdown. On average, they last about eight days.

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Speaker 2: There have been fifteen shutdowns since nineteen eighty one. But

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Speaker 2: it basically means people just aren't getting paid.

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Speaker 1: And so a shutdown occurs when Congress fails to pass

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Speaker 1: annual bills at fund government operations. Curiously, if that happened

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Speaker 1: in Australia, it would be grounds for a double dissolution

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Speaker 1: election because essentially, a denying supply to the government, you

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Speaker 1: can't actually pay your bills and you can't kind of

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Speaker 1: pay everything that needs to be paid. But in the

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Speaker 1: US this case, it means that data releases like this

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Speaker 1: week's September employment report that won't be released, air travel

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Speaker 1: all that checks and things that are required to get

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Speaker 1: people onto planes that'll be hit, scientific research suspended, and

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Speaker 1: pay withheld from US public servants.

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Speaker 2: Exactly this time, the two sides seem to be a

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Speaker 2: long way away from each other. The Democrats want to

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Speaker 2: leverage the opportunity to find exert some influence over the

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Speaker 2: Trump administration. The president has He's just come out and

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Speaker 2: streatened to use to stand off to fire more federal workers.

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Speaker 1: So that's the spirit. Now. Speaking of the President, Donald

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Speaker 1: Trump and Defense Secretary Pete Hegsath have given speeches to

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Speaker 1: the country's top military brass on issues ranging from grooming

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Speaker 1: and fat troops to how much the current president dislikes

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Speaker 1: Joe Biden.

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Speaker 2: I'm laughing already the photos of these generals and important

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Speaker 2: people in the military. They were very stony faced. The

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Speaker 2: military leaders were called home for the meeting. Most sat

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Speaker 2: there listened to tirades from their bosses. Remember Trump and

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Speaker 2: Hexath are their bosses. Just looked like they had better

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Speaker 2: things to do now, given their day jobs are like

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Speaker 2: complex military operations such as the maintenance of nuclear subs,

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Speaker 2: management of America's global alliances, and development of orders such

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Speaker 2: as those used to do strikes on Iran's nuclear program

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Speaker 2: this year. I just reckon they felt that their time

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Speaker 2: wasn't being well used. Trump started the meeting. He bashed

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Speaker 2: his predecessor Joe Biden for the US's military coat withdrawal

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Speaker 2: and defeated in Afghanistan. I think it was the most

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Speaker 2: embarrassing day in the history of our country, and now

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Speaker 2: we're back, We're not going to have any of that

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Speaker 2: crap happened. I can tell you that was terrible, so terrible.

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Speaker 2: That's where we started.

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Speaker 1: And then Hexath was even more incredible, talking about beards

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Speaker 1: and physical fitness and pretty much having a crack at

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Speaker 1: the military for not being much good. I just don't

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Speaker 1: know if you picked his audience.

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Speaker 2: Sean No on grooming standards. Let me quote him now,

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Speaker 2: more beards, long hair, superficial individual. We're going to cut

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Speaker 2: our hair, shave, shave our beards, and adhere to standards.

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Speaker 2: End quote. On physical fitness start quote. Frankly, it's tiring

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Speaker 2: to look out at combat formations or really any formation

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Speaker 2: and see fat troops. Likewise, it's completely unacceptable to see

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Speaker 2: fat generals and admirals in the halls of the Pentagon.

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Speaker 2: He hex said standards have been lowered across the force

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Speaker 2: over the past decade to meet arbitrary racial and gender quotas.

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Speaker 2: Remember he's talking to people who've been running the military

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Speaker 2: over that period. He said, fixing the problems was the

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Speaker 2: first step towards repairing a military that, since World War Two,

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Speaker 2: had lost the ability to win wars. Oh my word,

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Speaker 2: talk about going down like a lead balloon.

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Speaker 1: Oh god, that would have been an uncomfortable room to

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Speaker 1: be in anyway, Sean up next to Spear and Greed

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Speaker 1: Q and A I mentioned before June Beilou from ten cap.

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Speaker 1: It is a great interview to listen if you are

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Speaker 1: an investor or just interested in what's going on in

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Speaker 1: the Lafe local market. It is coming up in the

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Speaker 1: Fear and Greed playlist on your podcast platform or at

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Speaker 1: Fearangreed dot com dodau, which is where you sign up

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Speaker 1: for the free daily newsletter. I'll put a link in

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Speaker 1: today's show notes as well. Thank you very much, Sean.

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Speaker 2: Thanks Michael.

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Speaker 1: It's Thursday, the second of October twenty twenty five. Make

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Speaker 1: sure you're following the podcast and please join us online

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Speaker 1: on LinkedIn, Instagram, x TikTok and Facebook. I'm Michael Thompson

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Speaker 1: and that was Fear and Greed. Have a great day.