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Speaker 1: This is what the Flux.

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Speaker 2: I'm Brett and I'm Justin and it's Wednesday, the nineteenth

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Speaker 2: of February.

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Speaker 1: Boy, we knew about the proposed match made in the

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Speaker 1: Heavenly Skies between Virgin Australia and Qatar Airways, but this

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Speaker 1: was subject to a Triple C approval, and although the

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Speaker 1: A Triple C hasn't given the all clear one goal

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Speaker 1: just yet, they've again hinted that this deal could be

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Speaker 1: good for consumers and Virgin and Guitar are licking their lips.

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Speaker 2: European fliers also licking their lips. B Man, fus Man.

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Speaker 2: You have most certainly probably heard about the RBA's cash

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Speaker 2: rate update from yesterday, and if you have, we have

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Speaker 2: it all covered in the Flux out what happened, why

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Speaker 2: it happened, and what you should be doing right now

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Speaker 2: given the RBA's big decisions. Make sure to download the

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Speaker 2: Flux app to check it all out and win it money.

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Speaker 1: Three impactful stories today, Juzzy boy, let's do it for

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Speaker 1: our first, the Reserve Bank of Australia has cut the

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Speaker 1: cash rate for the first time since twenty twenty.

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Speaker 2: This is big news for Ossie homeowners and kind of

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Speaker 2: picked the banks as well, be man, So tell me

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Speaker 2: what's going on here.

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Speaker 1: Well, we know that the rb has been sitting on

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Speaker 1: its hands for a very long time. Yeah, thirteen of

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Speaker 1: the last fourteen meetings have seen eight bars on the

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Speaker 1: cash rates. In fact, the last time we saw a

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Speaker 1: rate cut was in November twenty twenty, back when Wap

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Speaker 1: by Cardi B was the hottest track on the radio.

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Speaker 2: And the Wap Dance was the hottest and most inappropriate

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Speaker 2: trend on TikTok.

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Speaker 1: But does wait. With inflation figures trending in the right direction,

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Speaker 1: the RBA has decided to cut the cash rate by

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Speaker 1: zero point two five percent, and.

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Speaker 2: That means the cash rate is now sitting pretty at

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Speaker 2: four point one percent.

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Speaker 1: And the big news is that the big four banks

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Speaker 1: all agreed to pass on the cash rate to their customers.

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Speaker 2: Watching the BN man Michelle Bullock, who's the RBA governor,

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Speaker 2: wants Ozzie to cool their jets.

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Speaker 1: Yep, she reckons the cash rate was a line ball decision,

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Speaker 1: so don't go expecting big cuts over the next few months.

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Speaker 1: What is the key learning here?

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Speaker 2: The RBA is walking a financial tightrope and one wrong

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Speaker 2: step can cause inflation chaos all over again.

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Speaker 1: On the one hand, the RBA wants to provide financial

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Speaker 1: relief to borrow is by cutting the cash rate.

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Speaker 2: On the other hand, it needs to ensure the stability

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Speaker 2: of the Australian economy.

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Speaker 1: Largely by ensuring inflation remains in Chair and b Man.

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Speaker 2: While the inflation number is trending in the right way,

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Speaker 2: there are still a number of concerning factors. We've got

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Speaker 2: a tight labor market, We've seen retail spending increase for

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Speaker 2: the first time in two years. There is uncertainty around

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Speaker 2: Donnie T's tariffs as well or which could lead to

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Speaker 2: higher inflation.

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Speaker 1: So jazzy boy. This is why the RBA governor expressed

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Speaker 1: pretty directly that we are unlikely to see another cut soon.

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Speaker 2: But be man, that ain't stopping the big four banks

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Speaker 2: from predicting more rate cuts in the future.

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Speaker 1: That is true. A and Z reckons will see one

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Speaker 1: more this year. CommBank reckons we'll see two more rate

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Speaker 1: cuts this year. And NAB and Westback are excited. They

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Speaker 1: reckon we'll see three more rate cuts this year.

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Speaker 2: In total, down a whole one percent.

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Speaker 1: For our second story, Bendigo and Adelaide Bank has seen

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Speaker 1: at share price drop by more than fifteen percent if

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Speaker 1: you don't mind. And that's just for this week after

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Speaker 1: it ran out of cheap money invests.

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Speaker 2: Unanngry be Man. They're just disappointed and let me tell

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Speaker 2: you that stings a lot more so tell me what

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Speaker 2: happened here.

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Speaker 1: Well a bit of boutground. Bendigo and Adelaide Bank is

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Speaker 1: the sixth biggest bank in Australia based on market value,

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Speaker 1: and Bendio Bank has.

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Speaker 2: Been around the bush literally.

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Speaker 1: Yeah, it's been around since eighteen fifty eight and specialized

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Speaker 1: in being the biggest quote community bank as it calls itself.

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Speaker 1: Now b Man Bendigo Bank merge with Adelaide Bank in

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Speaker 1: two thousand and seven when it became Bendigo and Adelaide Bank.

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Speaker 1: It's quite huge and it also happens to be the

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Speaker 1: owner of UP after fully acquiring UP in twenty twenty one.

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Speaker 2: But now be Man Bendigo and Adelaide Bank has announced

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Speaker 2: that its deposits group over five percent in the last half.

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Speaker 2: That's good. It's residential lending also increased over five percent

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Speaker 2: in the last half.

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Speaker 1: Very good.

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Speaker 2: But before you're too excited, Bendigo and Adelaide Bank, so

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Speaker 2: it's net interest margin dropped by point six percent.

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Speaker 1: Wow. So what does this all mean, Juzzi boy.

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Speaker 2: Well, it received too much demand for loans, which meant

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Speaker 2: it needed to use expensive wholesale funding.

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Speaker 1: But investors were not happy with this and its share

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Speaker 1: price dropped by more than fifteen percent.

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Speaker 2: So what is the key learning here?

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Speaker 1: Too much demand for loan is a bad thing when

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Speaker 1: you don't have enough cheap money lying around.

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Speaker 2: You see, b Man banks typically fund their home loans

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Speaker 2: in two ways.

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Speaker 1: Firstly, they fund it through deposits from their retail customers.

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Speaker 2: For example, when you put money in a savings account,

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Speaker 2: the bank will lend a portion of your funds to someone.

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Speaker 1: Else and does it wait. Retail deposits are generally the

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Speaker 1: best source of funding.

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Speaker 2: The bank may give you four percent interest and lend

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Speaker 2: out your money at six percent.

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Speaker 1: The other way that banks fund their home loans is

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Speaker 1: through wholesale funding.

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Speaker 2: That's money borrow from big investors, from superfunds and other

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Speaker 2: financial institution.

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Speaker 1: Which is often more expensive for a bank.

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Speaker 2: So when banks don't have enough retail deposits to fund loans,

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Speaker 2: they have to turn to wholesale funding.

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Speaker 1: Now, for Bendigo, this became a problem because loan demand

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Speaker 1: grew beyond what its deposits could handle.

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Speaker 2: Which meant they had to rely on wholesale funding, which

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Speaker 2: increased its costs.

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Speaker 1: And squeezed margins.

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Speaker 2: And next minute, it's cash profits fell ten percent lower

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Speaker 2: than the previous half out for our third.

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Speaker 1: And final story, The New York Times has given the

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Speaker 1: all clear one goal for its staff to use AI

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Speaker 1: tools to write social copy and even editorial ideas.

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Speaker 2: Interesting update from The New York Times. B Man never

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Speaker 2: one eighty. I'm sniffing around, so tell me more.

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Speaker 1: Well. The New York Times is an American daily newspaper

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Speaker 1: that was founded in eighteen fifty one, and since then

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Speaker 1: it's become the most read newspaper in the whole world,

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Speaker 1: with more than eleven million subscribers. We'd be talking latest news,

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Speaker 1: opinion pieces, games, Hello wordle podka, Hello the Daily Now

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Speaker 1: does it wait?

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Speaker 2: Back?

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Speaker 1: In December twenty twenty three, The New York Times sued

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Speaker 1: open ai and Microsoft for copyright infringement.

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Speaker 2: They claimed that open ai was using its stories to

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Speaker 2: train its chatbots, and it.

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Speaker 1: Was stealing billions of dollars worth of work that was

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Speaker 1: done by hard working journalists.

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Speaker 2: And this is a major lawsuit taking a stand for

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Speaker 2: traditional media.

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Speaker 1: But now the same New York Times has given its

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Speaker 1: editors and staff the all clear to use its new

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Speaker 1: AI tool named Echo.

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Speaker 2: They're allowed to use this AI tool to develop editorial ideas,

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Speaker 2: brainstorm interview questions, or even help with research. So what

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Speaker 2: is the key learning here?

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Speaker 1: If you can't beat them, sue them and then join them.

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Speaker 2: Media companies are stuck in a love hate relationship with

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Speaker 2: AI yep.

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Speaker 1: On the one hand, from a business perspective, they understand

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Speaker 1: the value of AI.

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Speaker 2: It can help with ideation of articles, research, even summarizing

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Speaker 2: long end the jazz Boy.

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Speaker 1: On the other hand, the New York Times has built

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Speaker 1: its empire on quality and integrity.

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Speaker 2: So I've got a question for you, b Man, How

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Speaker 2: does The New York Times maintain that while giving AI

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Speaker 2: a key to the news room.

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Speaker 1: Well, having thought about that Jazzy Boy, we know that

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Speaker 1: a number of other media outlets have already made deals

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Speaker 1: with AI companies. For example, NewsCorp has encouraged its staff

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Speaker 1: to use AI and even has AI journalist producing more

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Speaker 1: than three thousand articles a week wow in its local papers.

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Speaker 1: So b Man, time will tell whether the New York

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Speaker 1: times will lean further into AI while also sewing open

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Speaker 1: AI for everything they've got flex am. If you're a

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Speaker 1: homeowner app, you might be very excited.

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Speaker 2: By the RBA's cash right cast, but what does it

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Speaker 2: actually mean for you and what should you be doing

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Speaker 2: right now? Well, in the Flux app, we've got a

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Speaker 2: whole list of things you should be looking at right

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Speaker 2: now if you want to capitalize on the ray casts.

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Speaker 2: So make sure to check out the Flex app to

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Speaker 2: learn some of the steps that homeowners can take during

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Speaker 2: a raate cut.

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Speaker 1: Thanks for listening, and we'll see you on Friday.