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Speaker 1: Today on Fear and Greed. House prices in Sydney, Melbourne,

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Speaker 1: Canberra and Darwin fall the competition watchdogs Sue's optus over

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Speaker 1: at selling techniques to people, including those with intellectual disabilities,

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Speaker 1: and Starbucks decides that an order of a Venti vanilla

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Speaker 1: bean frappuccino with two pumps of peppermint, one pump of

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Speaker 1: white mocker, and two scoops of Java chips using heavy

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Speaker 1: cream isn't good for business. All this plus news on

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Speaker 1: retail sales, soaring gold prices and much more. Welcome to

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Speaker 1: Fear and Greed. Daily business news for people who make

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Speaker 1: their own decisions. It is Friday, the first of November

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Speaker 1: twenty twenty four. Are Michael Thompson and Good Morning, Sean Aylmer.

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Speaker 2: Good morning, Michael. Well said that frappuccino order you did well.

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Speaker 1: The order, quite the order, quite the mouthful. And we'll

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Speaker 1: get to that story in a little bit, Shawn. The

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Speaker 1: main story though this morning, house prices across the nation

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Speaker 1: rose by on average zero point three percent during October. Sydney, Melbourne,

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Speaker 1: Canberra and Darwin all went backwards.

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Speaker 2: In Sydney, the dropping home values was the first month

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Speaker 2: on month decline since January twenty twenty three, and the

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Speaker 2: downturn was driven by weaker conditions in more expensive suburbs

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Speaker 2: according to core Logic. In Melbourne, the decline continues to trend,

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Speaker 2: which has seen house prices drop two percent over the

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Speaker 2: past year. The mid tier capitals, Wow, they're still performing

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Speaker 2: pretty well. In October, Brisbane was up zero point seven percent,

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Speaker 2: Adelaide one point one percent, and Perth one point four percent.

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Speaker 2: That means Brisbane is up thirteen percent annually, Adelaide fifteen

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Speaker 2: percent and Perth twenty three percent. However, they are losing momentum.

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Speaker 1: Twenty three percent though for fees that is that is staggering, right,

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Speaker 1: is that is a next level performance?

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Speaker 2: Yeah, and one point four percent for the month is

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Speaker 2: next level performance as well. But if you twelve times

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Speaker 2: one point four which is too hard for me to do,

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Speaker 2: but I'm guessing it's going to be coming around sixteen

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Speaker 2: seventeen percent, that's actually lower than the twenty three percent,

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Speaker 2: So the momentum is actually coming out of the market.

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Speaker 2: There's a consistent theme across the cities, whether they're going

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Speaker 2: up or down. More affordable areas are doing best. The

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Speaker 2: more expensive areas are doing worst now. The reason for

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Speaker 2: that in those more affordable areas there are more first

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Speaker 2: time buyers in the market. I reckon that's a good thing.

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Speaker 2: There are more investors in the market. This slowdown in

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Speaker 2: price growth has been accompanied by a jump in supply

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Speaker 2: that takes a lot of pressure off prices. This isn't

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Speaker 2: a disaster, right. Sydney house prices over the last year

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Speaker 2: are up nearly four percent. Melbourne I mentioned, they're actually

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Speaker 2: down about two percent. Nationally they're up about six percent

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Speaker 2: now if you could have I don't know, it's three

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Speaker 2: four five percent house growth over the long term. That's

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Speaker 2: probably about what the economy is growing, maybe a bit

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Speaker 2: more in fact, so that's actually not too bad, i'd say,

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Speaker 2: But these numbers, certainly the four cities you mentioned at

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Speaker 2: the top Sydney, Melbourne, Canberra, Darwen house price growth has ended.

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Speaker 1: Sean staying in the housing industry. There are some signs

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Speaker 1: of life in the home building sector, with approvals jumping

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Speaker 1: in September.

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Speaker 2: Yes, so building approvals are up four point four percent.

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Speaker 2: It reversed a for the previous month. There was a

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Speaker 2: big jump in apartments. Basically, I think it's fair to

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Speaker 2: say there's life in the building sector again. Approvals are

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Speaker 2: up about thirteen percent on their low point about seven

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Speaker 2: months ago. They're running at about one hundred and seventy thousand

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Speaker 2: a month, and that's below the two hundred and forty

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Speaker 2: thousand needed to meet the government's housing accord. But it

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Speaker 2: is better than where we are where we were. The

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Speaker 2: long term key to solving housing crisis is more houses,

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Speaker 2: so these numbers are certainly welcome. One thing just to

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Speaker 2: keep an eye on. Completions are lower than approval, so

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Speaker 2: when you go with the process, you get the approval

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Speaker 2: from council. We count that as one. Completions were not

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Speaker 2: actually a one for one at the moment. However, having

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Speaker 2: been worried about building construction since about twenty twenty two,

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Speaker 2: there are finally some good news and good news in

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Speaker 2: that sector.

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Speaker 1: And Sean, let's finish this part of the show with

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Speaker 1: more economics.

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Speaker 2: Which never too much economics. Michael I thought.

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Speaker 1: About to say, talking dirty to me away I am

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Speaker 1: for an economist, this would be very very enticing. Retail

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Speaker 1: trade figures for September were flat following a boom August.

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Speaker 1: I didn't need to say boom that way, did I?

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Speaker 1: I've committed the first go back on it. Now it's

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Speaker 1: all according to the Australian Bureau of Statistics.

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Speaker 2: So remember a month ago we were talking about unseasonably

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Speaker 2: warm weather helping retailers. That spending has held up. It

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Speaker 2: hasn't grown well in retail sales for the month of

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Speaker 2: September up to zero point one percent, but at least

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Speaker 2: it hasn't fallen back, so things are going okay. Cafes,

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Speaker 2: restaurants and takeaway food services actually was the only sector

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Speaker 2: to rise in September sharply anyway, Department stores were the worst.

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Speaker 2: I think what's more interesting is now we have the

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Speaker 2: three months of the September quarter. If you look at that,

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Speaker 2: it's interesting because July one, we've got the tax cuts,

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Speaker 2: We've got that energy bill relief seventy five dollars a quarter.

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Speaker 2: That was wasn't it, Yes, three hundred dollars a year,

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Speaker 2: seventy five dollars a quarter, So that kicked in volume.

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Speaker 2: Over the three months, sales volumes were up, but revenue

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Speaker 2: was flat. In fact, spending per person fell for the

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Speaker 2: ninth straight quarter we had migration kind of explains the

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Speaker 2: difference between the two. Spending per person is now at

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Speaker 2: its lowest level in three years. The point there, people

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Speaker 2: didn't go and take those tax cuts and the energy

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Speaker 2: rebates and splurge on other stuff. And that's actually good

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Speaker 2: in terms of keeping inflation under control because that was

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Speaker 2: always a concern the tax cuts, people would spend them,

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Speaker 2: more pressure on inflation. Doesn't seem to have happened.

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Speaker 1: Does that mean then, in the case of the tax cuts,

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Speaker 1: that they are saving that money then, Sean, or or

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Speaker 1: they're just not rushing out and spending it in large

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Speaker 1: enough numbers to have a material impact.

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Speaker 2: So I think with the energy rebates, it's money that

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Speaker 2: you don't have to spend, so it's not like you're

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Speaker 2: getting extra money with the tax cuts. It was actually

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Speaker 2: extra money you received in your pay packet. So if

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Speaker 2: you think of it that way, it's probably the tax

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Speaker 2: cuts are more likely to be spent. But that hasn't happened.

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Speaker 1: Okay, all right, Sean, we have a fair bit to

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Speaker 1: get through. There's a big show coming up. We'll be

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Speaker 1: back in a moment with the rest of the day's

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Speaker 1: business news. Sean Optus is being sued by the Competition

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Speaker 1: watchdog after allegedly putting undue pressure on consumers, including people

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Speaker 1: with intellectual disabilities, to buy phones and mobile plans. This

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Speaker 1: is really pretty disturbing.

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Speaker 2: It is, The Australian Competition and Consumer Commission Chair Gena

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Speaker 2: Cass Gottlieb said, and I quote this case concerns allegations

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Speaker 2: of very serious conduct as our case is that OPTAs

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Speaker 2: sold goods to consumers experiencing vulnerability which they did not need,

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Speaker 2: did not want, and could not afford. Now the watchdog

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Speaker 2: claims Optus acted with unconscionable conduct that included pursuing debts

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Speaker 2: continuing after management became aware of weaknesses in its systems

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Speaker 2: exploited by sales staff. This is according to report in

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Speaker 2: the finn Review. The case in the Federal Court also

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Speaker 2: alleges Optus put undue pressure on people to buy phones

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Speaker 2: and communications services, even though some could not use the

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Speaker 2: service at home because there was no Optus coverage where

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Speaker 2: they live. Now, Interim CEO Michael Ventor came out yesterday.

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Speaker 2: He apologized. He said the Telko has sacked several staff.

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Speaker 2: This still has to be tried in court, of course,

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Speaker 2: but he said that the standards of service were it

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Speaker 2: up to speed, so.

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Speaker 1: Very quick response wasn't it from Optus yesterday? In relation

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Speaker 1: to this, When you consider some of the challenges that

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Speaker 1: Optus has had in the past about responding to major,

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Speaker 1: major issues very very quickly, it appears maybe some of

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Speaker 1: those lessons might have been learned, at least in terms

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Speaker 1: of the PR response.

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Speaker 2: Maybe it's a legal case, so it's very difficult to

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Speaker 2: say anything when it's illegal. There are any allegations, we

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Speaker 2: don't know whether they're right or wrong. Optus, though, as

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Speaker 2: you just alluded to, has had a very rough couple

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Speaker 2: of years and so they're trying to get on the

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Speaker 2: front foot in a PR sense. When naturalc comes out

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Speaker 2: and sort of claims these things, really hard to fight

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Speaker 2: that one.

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Speaker 1: Oh yeah yeah. Indeed, now shown the flight upgrade saga.

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Speaker 1: It just keeps going. Every day there is something else,

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Speaker 1: and now we've got Opposition leader Peter Dutton conceding that

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Speaker 1: his office asked Gina Reinhart's office to use her company's

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Speaker 1: private jet to travel from Queensland to Sydney to attend

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Speaker 1: a Barley bombing service.

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Speaker 2: So Peter Dutton said he couldn't get a Marshall fly

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Speaker 2: and he said the government refused his request for an

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Speaker 2: af plane. They costed a private charter forty thousand dollars unreasonable,

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Speaker 2: so they gave Gina a call. The opposition Transports spokesperson

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Speaker 2: Bridget mackenzie, she's been leading the attacks against the government. Well,

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Speaker 2: she now conceded that she's checking with her lines just

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Speaker 2: in case she received upgrades, because she did find herself

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Speaker 2: in business class at times, and so she's just checking

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Speaker 2: on that. This of course, all flows from the book

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Speaker 2: on Quantus by Joe Aston, which was released this week.

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Speaker 2: In it, it infers that Anthony Albernizi rang Alan Joyce

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Speaker 2: then to then CEO of Quantus and asked for upgrades

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Speaker 2: when he was Transport Minister. The travel was personal. Now

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Speaker 2: the Prime Minister's office yesterday came out and said mister

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Speaker 2: Albernezi had never rung mister Joyce, had never text him

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Speaker 2: or emailed him asking for an upgrade. Maybe, but it's

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Speaker 2: about four days for that to come out, and I

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Speaker 2: think that really is the point end of this story.

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Speaker 2: This has opened a Pandora's box around transparency on the

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Speaker 2: perks that politicians receive, and I think we're going to

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Speaker 2: hear a lot more about this one.

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Speaker 1: Michael Sewan do you know what it's reminding me of now.

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Speaker 1: Remember would have been six or seven years ago now,

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Speaker 1: the dual citizenship situation with MPs, where all of a

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Speaker 1: sudden you've had all of these MPs going. You know what,

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Speaker 1: I'm just going to go and double check right now

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Speaker 1: to make sure I don't accidentally have dual citizenship. It

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Speaker 1: feels like that now with Bridget McKenzie saying, look, you

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Speaker 1: know what, I'm just going to go and double check

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Speaker 1: now to see if I have received any upgrades, because

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Speaker 1: I just know that if this happens, it is going

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Speaker 1: to come out eventually and cause a major major problem

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Speaker 1: for them.

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Speaker 2: Yeah, there's a liberal backbench that came out yesterday and

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Speaker 2: she upgraded her pekinary interests register. I don't know whether

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Speaker 2: that's a register, but certainly the register of what and

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Speaker 2: you know said she'd been upgraded a couple of times.

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Speaker 2: I think there are a lot of policy decisions at

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Speaker 2: the moment. Just checking to see that fight they took.

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Speaker 2: How can I end up in business class.

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Speaker 1: Just by accident? I just sat down and they didn't

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Speaker 1: ask me to move. Sean, moving on, moving on from politics,

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Speaker 1: We's farmers held ats AGM yesterday and chair Michael Cheney

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Speaker 1: said contributions of companies like West Farmers have been underappreciated

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Speaker 1: in Canberra. So we're not really moving away from politics

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Speaker 1: that much here, are we.

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Speaker 2: Well, not really. He basically said some changes to employment laws,

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Speaker 2: payroll taxes, environmental laws work against productivity improvements. He said

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Speaker 2: that there seems to be this view that profits a

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Speaker 2: dirty word, and profit isn't a dirty word. One hundred

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Speaker 2: percent correct, Profit is not a dirty word. He really

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Speaker 2: did have a bit of a spray at the government. Otherwise,

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Speaker 2: on the market yesterday, the S and PA six two hundred,

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Speaker 2: it fell a quarter of percent to eighty one hundred

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Speaker 2: and sixty points. A couple of interesting ones there. JB

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Speaker 2: High five shares jumped five percent. Sales figures beat expectations.

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Speaker 2: The banks were a mixed bunch, some BHP Felm fairly sharply.

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Speaker 2: Wi Stick Global did pretty well. Canvas Worth a mention

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Speaker 2: not listed, but it did a share sale. That Canva,

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Speaker 2: of course, is the software where we do our wonderful

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Speaker 2: social media posts.

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Speaker 1: Michael, just a little bit of context here. If you

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Speaker 1: haven't followed fear and greed on LinkedIn, head along to

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Speaker 1: our LinkedIn page and follow us on there and see

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Speaker 1: the creation of a couple of days ago. That really

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Speaker 1: just demonstrated the fact that you, Sean and me and

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Speaker 1: certainly Adam Lang our colleague, and Luke we really we

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Speaker 1: really don't know what we're doing with Canvas, do we?

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Speaker 1: And this was your effort was pretty good.

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Speaker 2: Yeah, yeah, Look, cans Canvas not listed, but it sold

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Speaker 2: some shares yesterday. Said as a result, you get evaluation

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Speaker 2: of it. It's up about twenty three percent since its

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Speaker 2: previous valuation, which is only April this year. It's got

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Speaker 2: a valuation now of about fifty billion dollars. If that

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Speaker 2: was listed on the AX, it'd be the eleventh largest company,

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Speaker 2: ahead of Telstra, head of Woollies, head of Weisteck Global.

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Speaker 2: Quite remarkable.

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Speaker 1: That really is plenty going on as well in international markets,

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Speaker 1: with data out of the US showing a strong labor

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Speaker 1: market and decent growth in the world's biggest economy, and.

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Speaker 2: That hit financial markets. Bond markets trimmed bets of the

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Speaker 2: size of rate cuts in the US in coming months.

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Speaker 2: The Fed meets next week, expected to cut rates by

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Speaker 2: twenty five basis points, but no more. Now. All that

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Speaker 2: information pushed the Aussie dollar lower. It had been heading

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Speaker 2: towards sixty six US cents. Now it's about sixty five

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Speaker 2: and a half. Since gold Michael keeps shining brighter and brighter.

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Speaker 2: It hit a new record yesterday, just below twenty eight

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Speaker 2: hundred US dollars. An ounce plenty going on there. Mostly

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Speaker 2: it's about the fact that it's a safe haven ahead

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Speaker 2: of the US election, ahead of the potential for interest

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Speaker 2: rates to rise. People like gold when that happens. It's

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Speaker 2: up more than thirty percent this year. Quite a phenomenal run. Also,

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Speaker 2: go on figures from China. There's well this actually sounds

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Speaker 2: quite dull compared to gold, but I could.

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Speaker 1: Actually see I could see you just then go oh oh,

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Speaker 1: Do I finish I finished talking about gold? Or do

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Speaker 1: I just bring the tone of everything down? Go on,

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Speaker 1: you've started now you may want to bring us down further.

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Speaker 2: The factory, the factory flaws around China are busier as

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Speaker 2: a result of the stimulus that's been pumped into that

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Speaker 2: economy in recent weeks. That actually is good news for

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Speaker 2: Australia because when the factory is a busier, more like

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Speaker 2: to demand our exports.

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Speaker 1: That was important. I feel like you talked about down

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Speaker 1: too much.

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Speaker 2: Aah.

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Speaker 1: Sorry right, just quick mentioned after the show, Sean, you

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Speaker 1: got an interview coming up with Michael McCarthy from MUMU all.

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Speaker 2: About investing in ABC stocks. We talk about how hard

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Speaker 2: it used to be and how easy it is now

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Speaker 2: and why you should do it, and you need to

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Speaker 2: do it with your eyes open. You need to know

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Speaker 2: a bit about the stocks and the key reasons why

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Speaker 2: it can be beneficial for your portfolio.

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Speaker 1: It's coming up after the show. It's a good one,

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Speaker 1: so stick around for that one. Cole's Sean says that

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Speaker 1: sales of its home brands are booming, particularly the premium products,

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Speaker 1: but otherwise turnover is flat.

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Speaker 2: Yes, so it released its September quarter figures yesterday. Willis

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Speaker 2: did on Wednesday. Sales at Cole's supermarkets are up three

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Speaker 2: point five percent. Wool's actually reported three point eight percent growth.

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Speaker 2: Prices at Cole's rose just zero point one percent. Will

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Speaker 2: He's reported a slight fall. CEO of Cole's Lee Wikhart

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Speaker 2: said shoppers are now seeking out discounts more than they

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Speaker 2: have been recent years. Shoppers are looking at three or

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Speaker 2: four more retailers, three or four more. There you go,

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Speaker 2: three or more retailers every week to keep costs lower.

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Speaker 2: According to MS Workut strategy, rather than having lots of promotions,

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Speaker 2: they're actually having fewer, bigger promotions, so more half price promotions,

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Speaker 2: but on fewer items. She also mentioned, and it's a

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Speaker 2: really good point. The competition for Cole's isn't just Woolies

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Speaker 2: and Aldi and Costco and IgA nowadays, it's also Bunnings,

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Speaker 2: and it's Chemist Warehouse and all these other organizations. It's

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Speaker 2: a pretty tough environment for supermarkets, even without the government

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Speaker 2: pressure that's going on at the moment, what some analyst

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Speaker 2: said yesterday, because they're not seeing sales growth and people

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Speaker 2: are looking for cheaper products. The home brands, for example,

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Speaker 2: you could end up getting more discounting as they try

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Speaker 2: to win back customers. Gotta love competition, Michael, Yeah.

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Speaker 1: That is the moral of the story. And just very

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Speaker 1: very very quickly Sean got to mention this one. Australia's

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Speaker 1: richest person, Gina ryan Hunt, already received a mention earlier

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Speaker 1: in the show. Well, she's bought two onshore gas projects

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Speaker 1: from Underfire Mineral Resources for up to one point one

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Speaker 1: billion dollars and that sent the miners share price up

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Speaker 1: nine percent.

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Speaker 2: Yeah, got two exploration permits and a third one will

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Speaker 2: be a joint venture. Been a bit of a wild

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Speaker 2: ride for investors in the back of years. At the

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Speaker 2: founder of MinRes, Chris Ellison of Word at Tax for

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Speaker 2: a number of years, didn't tell he's brought about it.

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Speaker 2: The board of MinRes is expected handout its findings of

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Speaker 2: an investigation into all that on Monday.

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Speaker 1: Okay, turning to international news now, and some of the

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Speaker 1: big tech companies have reported September quarter earnings, and Microsoft

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Speaker 1: share price fell after at forecast slower cloud revenue growth.

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Speaker 2: I love this joy. Microsoft can't get enough data set

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Speaker 2: centers open because this huge demand for AI services. They

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Speaker 2: need data centers. Microsoft just can't get them online fast enough.

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Speaker 2: Otherwise it's ruining to report. Was pretty upbeat. Meta reported

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Speaker 2: as well, it's going to ramp up investments in AI

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Speaker 2: and the metaverse. Its share price was down three percent.

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Speaker 2: AMD Advanced micro Devices sells chips for AI that was

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Speaker 2: slower than anticipated. Its share price fell eleven percent.

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Speaker 1: The UK Sean has brought down one of the toughest

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Speaker 1: budgets in memory, with forty billion pounds in new taxes.

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Speaker 1: These are new taxes.

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Speaker 2: Yes, so the heart of the plan apparently is to

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Speaker 2: fix the country's broken finances and public services. Key Starmer's

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Speaker 2: government was only elected in the last couple of months,

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Speaker 2: so maybe you go really hard, really early. There's twenty

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Speaker 2: five billion dollars increase in national insurance on employers, although

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Speaker 2: that could just flow through to lower wages. There's increases

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Speaker 2: in capital gains tax and inheritance tax. Tax will be

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Speaker 2: thirty eight point two percent of GDP, which is an

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Speaker 2: absolute record. Inflation's forecast to increase put pressure on mortgages.

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Speaker 2: Growth is tipped to slow sharp increase in borrowing. Not

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Speaker 2: much good news in that budget.

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Speaker 1: No, No, there certainly isn't. Finally, Sean been waiting to

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Speaker 1: get to this story. Starbucks is experiencing a crisis. Sales

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Speaker 1: of the world's biggest coffee chain are down, Fewer people

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Speaker 1: are coming into the stores, and the group's share price

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Speaker 1: has hardly.

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Speaker 2: Moved this year. Yes, well, actually, the group's share price

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Speaker 2: is about where it was at the beginning of the year,

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Speaker 2: though it in May then recovered in September when they

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Speaker 2: got a new CEO. That new CEO is a guy

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Speaker 2: called Brian Nicol. He is what he has come and

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Speaker 2: said is that people's experience at Starbucks is now very transactional.

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Speaker 2: The menus that are overwhelming, the product is inconsistent, the

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Speaker 2: wait is too long, and the handoff hectic job.

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Speaker 1: Basically, there's nothing good about his business.

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Speaker 2: Is to say this guy, he actually came from one

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Speaker 2: of the other fast food groups and his package is

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Speaker 2: worth about one hundred million dollars, so he's really highly ranked.

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Speaker 2: There's also a few other I mean, he didn't mention these,

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Speaker 2: but analysts are saying, well, eight dollar lattes. That doesn't fly.

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Speaker 2: There's a bunch of other coffee shops now competing with Starbucks,

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Speaker 2: and the one I love, the eight ingredient drinks take

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Speaker 2: too long to make, so you know you'll go into

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Speaker 2: the shop. You're waiting for a long time for that

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Speaker 2: eid ingredient drink. The other things a third of the

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Speaker 2: orders and mobile orders, so people come in and pick

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Speaker 2: up their orders. But that means those who have come

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Speaker 2: and underline thing waiting too long. First steps, according to

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Speaker 2: the new CEO, Brian Nicol, don't charge for non dairy milk,

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Speaker 2: don't increase prices, and they've got a goal of serving

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Speaker 2: in four minutes there you go.

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Speaker 1: What I love about that story is that he's clearly

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Speaker 1: just gone into it with his eyes completely wide open, yep,

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Speaker 1: just to the challenges of the business and now has

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Speaker 1: a plan to fix it. I find that fascinating.

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Speaker 2: If you go to a Starbucks in the US, and

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Speaker 2: I haven't been in the US for the last twelve

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Speaker 2: months or so, but you go in and it just

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Speaker 2: takes forever. You go to a coffee shop here, They're friendly,

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Speaker 2: the service is good, even when they're busy. You still

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Speaker 2: seem to get your coffee in good time. And it's

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Speaker 2: also better and the coffee is so much better. Yes,

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Speaker 2: all right.

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Speaker 1: Up next is the Fear and Greed Daily Interview with

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Speaker 1: Michael McCarthy from MUMU. As we mentioned before, and also

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Speaker 1: keep an eye on your playlist at around midday a

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Speaker 1: new episode of Asks Fearing Read our bonus podcast where

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Speaker 1: we answer listen to questions are 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 dot a you thank you, Sewan, thank you, Michael.

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Speaker 1: It's Friday, the first of November twenty twenty four. Make

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Speaker 1: sure you 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.