1 00:00:04,019 --> 00:00:06,689 Michael Thompson: The Reserve Bank lifts the official cash rate for the 2 00:00:06,690 --> 00:00:09,840 Michael Thompson: 12th time in 14 months, and warns there could still 3 00:00:09,840 --> 00:00:12,809 Michael Thompson: be more on the way. The boom times for Australian 4 00:00:12,809 --> 00:00:15,989 Michael Thompson: crop growers look to be coming to an end, and 5 00:00:15,990 --> 00:00:19,770 Michael Thompson: TikTok usurps Snapchat as the third most popular app in 6 00:00:19,770 --> 00:00:23,850 Michael Thompson: Australia after Facebook and Instagram. It's Wednesday the 7th of 7 00:00:23,850 --> 00:00:27,719 Michael Thompson: June 2023. Welcome to Fear and Greed, Australia's most popular 8 00:00:27,719 --> 00:00:31,470 Michael Thompson: business podcast. I'm Michael Thompson, and good morning, Sean Aylmer. 9 00:00:31,679 --> 00:00:32,970 Sean Aylmer: Ah, good morning, Michael. 10 00:00:33,269 --> 00:00:36,089 Michael Thompson: Sean, after the show your interview today is with Elinor 11 00:00:36,240 --> 00:00:39,810 Michael Thompson: Kasapidis, who is the senior manager of tax policy at 12 00:00:39,810 --> 00:00:41,010 Michael Thompson: CPA Australia. 13 00:00:41,370 --> 00:00:45,269 Sean Aylmer: All about what investors should be thinking about now ahead 14 00:00:45,269 --> 00:00:48,629 Sean Aylmer: of tax time, and then once 30 June ticks over 15 00:00:48,630 --> 00:00:50,519 Sean Aylmer: and we've all got to fill in our tax returns, 16 00:00:50,700 --> 00:00:55,290 Sean Aylmer: what they can and can't claim. So certainly an interview 17 00:00:55,290 --> 00:00:56,070 Sean Aylmer: for investors. 18 00:00:56,280 --> 00:00:57,660 Michael Thompson: Yeah, it's a really good one. It's brought to you 19 00:00:57,660 --> 00:01:00,150 Michael Thompson: today by Stake, one of our supporters here at Fear 20 00:01:00,150 --> 00:01:03,360 Michael Thompson: and Greed. The main story this morning, Sean, the Reserve 21 00:01:03,360 --> 00:01:07,410 Michael Thompson: Bank lifted the official cash rate yesterday by 25 basis 22 00:01:07,410 --> 00:01:12,390 Michael Thompson: points saying that inflation, at 7%, is just too high. 23 00:01:13,110 --> 00:01:16,199 Sean Aylmer: That's it. The Central Bank said the hike yesterday will 24 00:01:16,200 --> 00:01:20,220 Sean Aylmer: provide greater confidence that inflation will return to its target 25 00:01:20,220 --> 00:01:23,940 Sean Aylmer: of two to 3% within a reasonable timeframe. In a 26 00:01:23,940 --> 00:01:27,779 Sean Aylmer: statement after the decision, Governor Philip Lowe said, " High inflation 27 00:01:27,780 --> 00:01:31,530 Sean Aylmer: makes life difficult for people and damages the functioning of 28 00:01:31,530 --> 00:01:35,220 Sean Aylmer: the economy. It erodes the value of savings, hurts family 29 00:01:35,220 --> 00:01:39,360 Sean Aylmer: budgets, makes it harder for businesses to plan and invest, 30 00:01:39,660 --> 00:01:43,679 Sean Aylmer: and worsens income inequality. If it becomes entrenched, it will 31 00:01:43,679 --> 00:01:47,129 Sean Aylmer: lead to even higher rates and a larger rise in 32 00:01:47,129 --> 00:01:51,330 Sean Aylmer: unemployment." After last week's big jump in award wages, Phil 33 00:01:51,330 --> 00:01:54,480 Sean Aylmer: Lowe, the governor, said that, " Unit labor costs are rising 34 00:01:54,840 --> 00:01:59,759 Sean Aylmer: briskly," was his word, briskly, with productivity growth being subdued. 35 00:01:59,759 --> 00:02:03,989 Sean Aylmer: He said, " As long as productivity improves, wages growth in 36 00:02:03,990 --> 00:02:05,489 Sean Aylmer: the system is okay." 37 00:02:06,870 --> 00:02:09,540 Michael Thompson: What do you take from that? Is this the last 38 00:02:09,540 --> 00:02:10,290 Michael Thompson: rate rise? 39 00:02:11,190 --> 00:02:14,700 Sean Aylmer: Hard to say. Lowe said, " The path to achieving a so- 40 00:02:14,700 --> 00:02:18,090 Sean Aylmer: called soft landing remains a narrow one, mostly because it's 41 00:02:18,090 --> 00:02:21,750 Sean Aylmer: not clear whether the household consumption will hold up." There's 42 00:02:21,750 --> 00:02:25,980 Sean Aylmer: a real risk now, as Commonwealth Bank economists noted yesterday, 43 00:02:26,340 --> 00:02:29,490 Sean Aylmer: that the Australian economy could go into recession as a 44 00:02:29,490 --> 00:02:33,690 Sean Aylmer: result of ongoing rate rises. The governor said some further 45 00:02:33,690 --> 00:02:38,008 Sean Aylmer: tightening might be required, but it depends on what happens 46 00:02:38,008 --> 00:02:41,820 Sean Aylmer: from here. Financial markets think there will be another rate 47 00:02:41,820 --> 00:02:44,639 Sean Aylmer: rise. I think it's fair to say that previously, the 48 00:02:44,639 --> 00:02:48,899 Sean Aylmer: Reserve Bank was determined to lift interest rates, whereas now 49 00:02:48,900 --> 00:02:52,530 Sean Aylmer: the board's not so sure, but it certainly isn't off 50 00:02:52,530 --> 00:02:53,190 Sean Aylmer: the agenda. 51 00:02:54,120 --> 00:02:56,910 Michael Thompson: How long does it take for this to filter through, 52 00:02:57,330 --> 00:03:00,329 Michael Thompson: then? Because it feels almost, from what you're saying, that 53 00:03:00,329 --> 00:03:02,490 Michael Thompson: it might be a little bit of a, almost a wait 54 00:03:02,490 --> 00:03:04,679 Michael Thompson: and see approach. How long will they need to wait? 55 00:03:05,610 --> 00:03:08,160 Sean Aylmer: Well, it takes 12 to 18 months or that's what I learned 56 00:03:08,520 --> 00:03:11,639 Sean Aylmer: when I did economics at university. 12 to 18 months for an 57 00:03:11,639 --> 00:03:14,910 Sean Aylmer: interest rate to fully flow through the economy and impact 58 00:03:14,910 --> 00:03:17,819 Sean Aylmer: the economy. Now, the first one we had was 14 59 00:03:18,210 --> 00:03:21,750 Sean Aylmer: months ago. We've had 12 since then. That first one 60 00:03:21,750 --> 00:03:26,340 Sean Aylmer: hasn't fully filtered through to the economy theoretically. What it 61 00:03:26,340 --> 00:03:29,880 Sean Aylmer: means, we're seeing now with West Farmers last week, we 62 00:03:29,880 --> 00:03:32,580 Sean Aylmer: had Bubs Australia yesterday, a bunch of companies coming out 63 00:03:32,580 --> 00:03:36,479 Sean Aylmer: and saying, " Things are slowing down." The reserve Bank highlighted 64 00:03:36,660 --> 00:03:40,950 Sean Aylmer: consumption yesterday as being a real concern for it. People 65 00:03:40,950 --> 00:03:43,890 Sean Aylmer: just aren't spending as much. Consumption, of course, is the 66 00:03:43,890 --> 00:03:46,710 Sean Aylmer: biggest part of the economy. Therefore, that could slow the 67 00:03:46,710 --> 00:03:48,809 Sean Aylmer: economy, and the Reserve Bank is worried that the full 68 00:03:48,809 --> 00:03:52,199 Sean Aylmer: impact of these rate rises will start to hit in 69 00:03:52,199 --> 00:03:55,440 Sean Aylmer: the next three, six, 12 months and the economy will 70 00:03:55,440 --> 00:03:56,280 Sean Aylmer: end up in recession. 71 00:03:56,940 --> 00:03:59,190 Michael Thompson: Okay, and so then in the, I suppose, the short 72 00:03:59,190 --> 00:04:02,280 Michael Thompson: term, what's it mean for us mere mortgage holders? 73 00:04:02,910 --> 00:04:05,459 Sean Aylmer: Yes, we mere mortgage holders. Well, we've had 12 rate 74 00:04:05,460 --> 00:04:08,429 Sean Aylmer: hikes since the beginning of May last year, and the 75 00:04:08,429 --> 00:04:11,129 Sean Aylmer: cash rate, which is used to set other interest rates, 76 00:04:11,129 --> 00:04:16,890 Sean Aylmer: is now at its highest level since 2012. That's 4.1%. There are about 3. 77 00:04:17,190 --> 00:04:20,849 Sean Aylmer: 3 million Australians with a mortgage, Michael. The standard variable 78 00:04:20,849 --> 00:04:22,589 Sean Aylmer: rate at the moment is now in the mid to 79 00:04:22,589 --> 00:04:26,250 Sean Aylmer: high sixes. The latest rise will add $ 114 to the 80 00:04:26,250 --> 00:04:31,350 Sean Aylmer: monthly repayments on a $ 750,000 variable rate home loan. That 81 00:04:31,350 --> 00:04:34,740 Sean Aylmer: takes the total increase in monthly repayments since the beginning 82 00:04:34,740 --> 00:04:39,210 Sean Aylmer: of last year to more than $1, 800. Alongside the cost 83 00:04:39,210 --> 00:04:41,818 Sean Aylmer: of living, or the increases in the cost of living, 84 00:04:42,210 --> 00:04:45,928 Sean Aylmer: that rise will definitely dent consumer spending. It already is, 85 00:04:45,928 --> 00:04:48,539 Sean Aylmer: and that's why the Reserve Bank and market economists are 86 00:04:48,540 --> 00:04:49,620 Sean Aylmer: worried about a recession. 87 00:04:50,190 --> 00:04:52,740 Michael Thompson: All right. How did local markets respond to this yesterday, Sean? 88 00:04:53,010 --> 00:04:55,710 Sean Aylmer: Well, the Aussie dollar jumped immediately after the announcement to 89 00:04:55,710 --> 00:04:58,710 Sean Aylmer: above 66 and a half US cents. That's because people are 90 00:04:58,710 --> 00:05:02,340 Sean Aylmer: taking a punt that interest rates in Australia will rise. 91 00:05:02,700 --> 00:05:06,539 Sean Aylmer: Bond yields rose, suggesting that professional investors think following yesterday's 92 00:05:06,539 --> 00:05:09,359 Sean Aylmer: statement, there is more chance of a rate rise. That's 93 00:05:09,360 --> 00:05:11,610 Sean Aylmer: a further rate rise, I mean, and the share market 94 00:05:11,610 --> 00:05:15,599 Sean Aylmer: fell almost 1% in the minutes after the 2: 30 PM announcement, 95 00:05:15,839 --> 00:05:18,570 Sean Aylmer: before rebounding somewhat. Then in the final minutes of trading, 96 00:05:18,570 --> 00:05:20,069 Sean Aylmer: it tumbled again. By the end of the day, it 97 00:05:20,070 --> 00:05:25,020 Sean Aylmer: was down 1. 2% to close at 7, 130 points. Consumer 98 00:05:25,020 --> 00:05:28,110 Sean Aylmer: discretionary stocks were hit hardest. Now they're the companies which 99 00:05:28,110 --> 00:05:30,900 Sean Aylmer: will really feel the effect of higher interest rates on 100 00:05:30,990 --> 00:05:35,698 Sean Aylmer: consumers. Discretionary, as in discretionary income. Of course, if people 101 00:05:35,700 --> 00:05:39,089 Sean Aylmer: have less discretionary income, those companies aren't going to sell 102 00:05:39,089 --> 00:05:42,419 Sean Aylmer: as much. Industrials fell as well, so too financials, healthcare, 103 00:05:42,420 --> 00:05:44,880 Sean Aylmer: and telcos. In fact, 19 of the top 20 stocks 104 00:05:45,150 --> 00:05:47,640 Sean Aylmer: ended lower yesterday, the only one in the black was 105 00:05:47,640 --> 00:05:48,570 Sean Aylmer: Fortescue Metals. 106 00:05:49,020 --> 00:05:50,940 Michael Thompson: What about international markets? What's happening there? 107 00:05:51,420 --> 00:05:53,730 Sean Aylmer: Well, global equity... In Australia, we haven't had a good 108 00:05:53,730 --> 00:05:56,549 Sean Aylmer: run, but global equity markets have done pretty well recently 109 00:05:56,549 --> 00:06:01,109 Sean Aylmer: with the S&P 500 on Wall Street trading around yearlong highs. The 110 00:06:01,110 --> 00:06:04,080 Sean Aylmer: Euro STOXX 50 is also close to record territory, and 111 00:06:04,080 --> 00:06:07,710 Sean Aylmer: Japan's Nikkei hit a new multi- decade high yesterday. It's 112 00:06:07,710 --> 00:06:12,090 Sean Aylmer: up 23% this year. Now, that compares to about 3% for the ASX 200. 113 00:06:12,360 --> 00:06:15,540 Sean Aylmer: Few key reasons. The market definitely was undervalued at the 114 00:06:15,540 --> 00:06:18,000 Sean Aylmer: beginning of the year and some economic reforms out of 115 00:06:18,120 --> 00:06:21,630 Sean Aylmer: Tokyo have been well supported, and then Warren Buffett's Berkshire 116 00:06:21,630 --> 00:06:26,550 Sean Aylmer: Hathaway, in April, very publicly bought into five Japanese stocks. 117 00:06:26,820 --> 00:06:30,749 Sean Aylmer: Now, these are the big conglomerates, Mitsui, Sumitomo, et cetera. 118 00:06:30,750 --> 00:06:33,750 Sean Aylmer: Mitsubishi was another one he bought into. They have a 119 00:06:33,750 --> 00:06:37,470 Sean Aylmer: broad range of interests, real estate, tech, healthcare, retail, financial 120 00:06:37,470 --> 00:06:41,460 Sean Aylmer: services. The speculated theory is that after 30 years of 121 00:06:41,460 --> 00:06:46,169 Sean Aylmer: deflation, because Japan has had deflation for many decades, buffet 122 00:06:46,170 --> 00:06:51,240 Sean Aylmer: realized that Japanese companies were undervalued, particularly in an inflationary 123 00:06:51,330 --> 00:06:54,990 Sean Aylmer: environment. Suddenly the Nikkei is trading around its highest level 124 00:06:54,990 --> 00:06:59,430 Sean Aylmer: since 1990. A very interesting market to watch, Japan. Quite 125 00:06:59,430 --> 00:07:01,080 Sean Aylmer: a serious start to the day, Michael. 126 00:07:01,200 --> 00:07:03,510 Michael Thompson: It was. It was, actually, and I feel like we 127 00:07:03,510 --> 00:07:05,729 Michael Thompson: need to lighten it up, but I'm just thinking ahead. 128 00:07:05,730 --> 00:07:09,059 Michael Thompson: It's been a big news in the last 24 hours 129 00:07:09,059 --> 00:07:11,069 Michael Thompson: or so, and I can't see too much light coming up. 130 00:07:11,129 --> 00:07:12,780 Sean Aylmer: Oh, there's some good ones. Don't you worry. 131 00:07:12,870 --> 00:07:14,220 Michael Thompson: All right, I look forward to that. We'll be back 132 00:07:14,220 --> 00:07:16,200 Michael Thompson: in a moment with the rest of the day's business news. 133 00:07:22,230 --> 00:07:26,759 Michael Thompson: Sean, the head of the ACTU Sally McManus says Qantas 134 00:07:26,820 --> 00:07:31,470 Michael Thompson: is, quote, " Gaming the system," by using loopholes in industrial 135 00:07:31,470 --> 00:07:35,400 Michael Thompson: relations laws that allow companies to pay staff on labor 136 00:07:35,400 --> 00:07:39,060 Michael Thompson: hire contracts less than those that they directly recruit. 137 00:07:39,570 --> 00:07:43,229 Sean Aylmer: Research conducted by the ACTU, which of course is the peak 138 00:07:43,320 --> 00:07:47,340 Sean Aylmer: union body, found Qantas has split its cabin crew workforce 139 00:07:47,340 --> 00:07:51,180 Sean Aylmer: across 14 companies and contractors, which the union group says 140 00:07:51,180 --> 00:07:55,140 Sean Aylmer: drives down wages and conditions for workers. McManus said, " Qantas 141 00:07:55,140 --> 00:07:58,080 Sean Aylmer: is the poster child for gaming the system to meet 142 00:07:58,080 --> 00:08:02,429 Sean Aylmer: the KPIs of executives." Qantas rejected the claims that its 143 00:08:02,429 --> 00:08:04,740 Sean Aylmer: use of labor hire is part of the concerted effort 144 00:08:04,740 --> 00:08:08,070 Sean Aylmer: to drive down wages and conditions. The national carrier said 145 00:08:08,070 --> 00:08:12,060 Sean Aylmer: that it has different cabin crew arrangements across Qantas, Jetstar, 146 00:08:12,060 --> 00:08:16,410 Sean Aylmer: and QantasLink for both domestic and international cabin crew, who 147 00:08:16,410 --> 00:08:19,170 Sean Aylmer: live and work in places all around the world, particularly 148 00:08:19,170 --> 00:08:21,809 Sean Aylmer: in places it flies to, like New Zealand and the 149 00:08:21,809 --> 00:08:22,499 Sean Aylmer: United Kingdom. 150 00:08:22,949 --> 00:08:25,560 Michael Thompson: Sean, is this in response to the big push by 151 00:08:25,560 --> 00:08:29,520 Michael Thompson: businesses to scuttle the federal government's same job, same pay 152 00:08:29,520 --> 00:08:33,150 Michael Thompson: legislation that's expected in parliament this year? There's been a 153 00:08:33,150 --> 00:08:34,139 Michael Thompson: lot about that lately. 154 00:08:34,260 --> 00:08:37,170 Sean Aylmer: Yeah, we're going to hear plenty more as well. Eight 155 00:08:37,259 --> 00:08:41,458 Sean Aylmer: peak organizations have launched a multi- million dollar campaign against 156 00:08:41,458 --> 00:08:45,270 Sean Aylmer: the proposed laws. Labor's proposal aims to stop companies paying 157 00:08:45,270 --> 00:08:48,870 Sean Aylmer: workers on labor hire contracts less than those who are 158 00:08:48,870 --> 00:08:52,800 Sean Aylmer: employed to do the same job on enterprise bargaining agreements. 159 00:08:53,040 --> 00:08:57,299 Sean Aylmer: That's exactly what McManus was talking about at Qantas. Yesterday, 160 00:08:57,299 --> 00:09:01,860 Sean Aylmer: employment minister Tony Burke told ABC Radio that business's passionate 161 00:09:01,980 --> 00:09:07,260 Sean Aylmer: campaign against the government's policy was misguided. As you said, 162 00:09:07,380 --> 00:09:08,760 Sean Aylmer: we're going to hear plenty about it. 163 00:09:09,480 --> 00:09:12,869 Michael Thompson: Now, Sean, the share price of ASX, that's the company, 164 00:09:12,870 --> 00:09:17,010 Michael Thompson: that is, that tumbled 11% yesterday after the group said 165 00:09:17,010 --> 00:09:20,700 Michael Thompson: it faced much higher capital spending as it tries to 166 00:09:20,700 --> 00:09:23,040 Michael Thompson: upgrade its clearing and settlement infrastructure. 167 00:09:23,400 --> 00:09:25,320 Sean Aylmer: Yes. If you think of what the ASX does, it's 168 00:09:25,320 --> 00:09:30,419 Sean Aylmer: clearing and settlements infrastructure is its heart. Now, the company 169 00:09:30,420 --> 00:09:35,339 Sean Aylmer: yesterday outlined its five year strategy, including near term situational 170 00:09:35,340 --> 00:09:39,000 Sean Aylmer: challenges, is how they put it. Chief Executive Helen Lofthouse, 171 00:09:39,000 --> 00:09:42,330 Sean Aylmer: who hasn't been in the job very long, said those 172 00:09:42,330 --> 00:09:46,708 Sean Aylmer: challenges include much needed technology upgrades. It will keep its 173 00:09:46,710 --> 00:09:50,160 Sean Aylmer: nearly three decade old CHESS trading system running until 2032, 174 00:09:51,509 --> 00:09:54,929 Sean Aylmer: because it's struggling to find a replacement. Now, ASX spent 175 00:09:54,929 --> 00:09:58,530 Sean Aylmer: seven years building an alternative to CHESS, it was meant 176 00:09:58,530 --> 00:10:01,170 Sean Aylmer: to start in 2020, so it started 10 years ago 177 00:10:01,170 --> 00:10:04,769 Sean Aylmer: building a replacement. It never got off the ground, that 178 00:10:04,770 --> 00:10:06,929 Sean Aylmer: was abandoned. Now they're saying it's going to be there 179 00:10:06,929 --> 00:10:09,569 Sean Aylmer: for another 10 years. That saga resulted in the Reserve 180 00:10:09,570 --> 00:10:13,050 Sean Aylmer: Bank and ASIC criticizing the company. Because it's going to 181 00:10:13,080 --> 00:10:15,449 Sean Aylmer: have to spend so much on systems in coming years, 182 00:10:15,510 --> 00:10:19,050 Sean Aylmer: ASX is going to lower its payout ratio next financial 183 00:10:19,050 --> 00:10:22,078 Sean Aylmer: year. The bottom line, ASX needs to spend hundreds of 184 00:10:22,080 --> 00:10:24,598 Sean Aylmer: millions of dollars in coming years to get itself back 185 00:10:24,660 --> 00:10:25,530 Sean Aylmer: on track. 186 00:10:26,099 --> 00:10:28,500 Michael Thompson: How about this one, Sean. The boss of Incitec Pivot 187 00:10:28,679 --> 00:10:32,338 Michael Thompson: has stepped down amid tensions over plans to split the 188 00:10:32,340 --> 00:10:35,070 Michael Thompson: company's explosives and fertilizers division. 189 00:10:35,580 --> 00:10:38,099 Sean Aylmer: Jean Johns has led the grip for five years and 190 00:10:38,099 --> 00:10:41,820 Sean Aylmer: has been pushing the de- merger plan. Now, she's left 191 00:10:41,940 --> 00:10:45,420 Sean Aylmer: the business. The company first floated plans to split its 192 00:10:45,420 --> 00:10:49,530 Sean Aylmer: explosives and fertilizers business back in 2019, but called off 193 00:10:49,530 --> 00:10:53,968 Sean Aylmer: the idea in 2020 after a strategic review. Suddenly it 194 00:10:53,970 --> 00:10:57,179 Sean Aylmer: had been revived again in 2022 with Incitec saying it 195 00:10:57,179 --> 00:10:59,848 Sean Aylmer: wanted to spin off its fertilizer business into a separate 196 00:10:59,849 --> 00:11:03,539 Sean Aylmer: listed company, arguing it would help realize the full market 197 00:11:03,540 --> 00:11:06,150 Sean Aylmer: valuation of both sides of the company. But the plan 198 00:11:06,150 --> 00:11:09,300 Sean Aylmer: has never really had the full support of major shareholders, 199 00:11:09,300 --> 00:11:12,030 Sean Aylmer: or not all the major shareholders, and the most recent 200 00:11:12,030 --> 00:11:16,289 Sean Aylmer: half year earnings disappointed. Now, the CEO who has been 201 00:11:16,290 --> 00:11:20,070 Sean Aylmer: pushing the plan has left. Incitec Pivot's share price is 202 00:11:20,070 --> 00:11:22,260 Sean Aylmer: down nearly 20% so far this year. 203 00:11:22,889 --> 00:11:26,760 Michael Thompson: Can you imagine her farewell speech? I reckon it'd be 204 00:11:26,760 --> 00:11:29,520 Michael Thompson: something like, ladies and gentlemen, it's been a blast. 205 00:11:32,220 --> 00:11:33,540 Sean Aylmer: Smelly, but a blast. 206 00:11:33,540 --> 00:11:33,838 Michael Thompson: Yeah. 207 00:11:34,170 --> 00:11:34,439 Sean Aylmer: Yeah. 208 00:11:34,679 --> 00:11:37,770 Michael Thompson: You got to say, running a fertilizer's company, it's fertile 209 00:11:37,770 --> 00:11:38,881 Michael Thompson: ground for puns, isn't it? 210 00:11:38,881 --> 00:11:41,248 Sean Aylmer: Yeah. Yeah. 211 00:11:41,458 --> 00:11:42,269 Michael Thompson: That was pretty good. 212 00:11:42,510 --> 00:11:44,490 Sean Aylmer: And look, it wasn't bad actually. I mean, I liked 213 00:11:44,490 --> 00:11:46,020 Sean Aylmer: the blast, actually. I thought that was pretty good. 214 00:11:46,170 --> 00:11:48,630 Michael Thompson: Oh, thank you. I feel like I've taken it as 215 00:11:48,630 --> 00:11:50,699 Michael Thompson: a personal challenge now that we need to lighten this 216 00:11:50,700 --> 00:11:52,230 Michael Thompson: show up a little bit. Because you promised it was 217 00:11:52,230 --> 00:11:53,309 Michael Thompson: going to get a little bit lighter and so far- 218 00:11:53,309 --> 00:11:56,609 Sean Aylmer: Okay, from here on in, I promise it does get lighter. 219 00:11:56,790 --> 00:12:00,239 Michael Thompson: Okay. Well, it's been a great run, Sean, for growers 220 00:12:00,270 --> 00:12:03,780 Michael Thompson: the past couple of years with high rainfall, but, this 221 00:12:03,780 --> 00:12:07,679 Michael Thompson: doesn't sound much lighter, a looming El Nino, where much 222 00:12:07,710 --> 00:12:11,339 Michael Thompson: of the continent will experience drier conditions, is set to 223 00:12:11,340 --> 00:12:13,620 Michael Thompson: cut wheat production by one third. 224 00:12:13,860 --> 00:12:17,879 Sean Aylmer: Farm exports are expected to drop by 17% to $65 billion next 225 00:12:17,879 --> 00:12:21,270 Sean Aylmer: financial year. That's according to the Australian Bureau of Agricultural 226 00:12:21,270 --> 00:12:26,098 Sean Aylmer: and Resource Economics and Sciences, ABARES for short. 227 00:12:26,400 --> 00:12:27,420 Michael Thompson: It's a catchy name, isn't it? 228 00:12:28,020 --> 00:12:33,360 Sean Aylmer: I lost my breath doing that. Anyway, over the past 229 00:12:33,360 --> 00:12:36,600 Sean Aylmer: three years, the La Nina phenomenon has boosted crops, and 230 00:12:36,600 --> 00:12:40,260 Sean Aylmer: even a forecast drop in exports next financial year to 231 00:12:40,260 --> 00:12:44,340 Sean Aylmer: nearly 45 million tons will actually be a historically strong 232 00:12:44,340 --> 00:12:47,010 Sean Aylmer: result. What it's really showing is just how good a 233 00:12:47,010 --> 00:12:50,280 Sean Aylmer: couple of seasons farmers have had. Almost 60% of the 234 00:12:50,280 --> 00:12:54,059 Sean Aylmer: winter crop production will be wheat, 22% barley and 11% 235 00:12:54,059 --> 00:12:59,250 Sean Aylmer: granola. ABARES noted that farm input costs, including fertilizer and 236 00:12:59,250 --> 00:13:02,639 Sean Aylmer: fuel, were falling from the peaks of last year. That 237 00:13:02,639 --> 00:13:05,639 Sean Aylmer: will help the farmers, putting them in a strong position 238 00:13:05,639 --> 00:13:07,919 Sean Aylmer: despite the softening in some commodity prices. 239 00:13:08,490 --> 00:13:10,050 Michael Thompson: Now, I mentioned this one, Sean, at the top of the 240 00:13:10,170 --> 00:13:15,690 Michael Thompson: show, TikTok Australia has now overtaken rival platform Snapchat, saying 241 00:13:15,690 --> 00:13:19,890 Michael Thompson: it has eight and a half million local customers. Eight 242 00:13:19,890 --> 00:13:22,170 Michael Thompson: and a half million. That is huge. 243 00:13:22,260 --> 00:13:23,040 Sean Aylmer: Are you on TikTok? 244 00:13:23,969 --> 00:13:25,440 Michael Thompson: Yes. Loosely. 245 00:13:25,889 --> 00:13:27,420 Sean Aylmer: Yes. Well, I mean you have an account. 246 00:13:27,660 --> 00:13:30,690 Michael Thompson: Yes. Yeah, it's Michael Thompson Author, if anyone wants to 247 00:13:30,719 --> 00:13:33,540 Michael Thompson: follow me. Sorry, I just thought I'd- 248 00:13:33,540 --> 00:13:34,260 Sean Aylmer: Shameless. 249 00:13:34,590 --> 00:13:34,800 Michael Thompson: Yeah. 250 00:13:34,800 --> 00:13:35,370 Sean Aylmer: Shameless. 251 00:13:35,400 --> 00:13:39,540 Michael Thompson: I have never pretended to have any dignity, Sean. 252 00:13:39,540 --> 00:13:43,679 Sean Aylmer: Oh dear. Do you post to it? 253 00:13:44,219 --> 00:13:44,969 Michael Thompson: Occasionally. 254 00:13:45,660 --> 00:13:48,479 Sean Aylmer: I might follow you. So TikTok, which of course is 255 00:13:48,480 --> 00:13:52,470 Sean Aylmer: the Chinese social media app, yesterday announced the milestone, the 8. 256 00:13:52,650 --> 00:13:56,760 Sean Aylmer: 5 million local customers, that's regular users, as well as 257 00:13:56,760 --> 00:14:01,710 Sean Aylmer: now having 350,000 local businesses using the platform. TikTok has 258 00:14:01,710 --> 00:14:05,969 Sean Aylmer: about one million more users than Snapchat, which in April 259 00:14:05,969 --> 00:14:08,880 Sean Aylmer: confirmed it had a pool of about 7. 5 million 260 00:14:08,880 --> 00:14:13,020 Sean Aylmer: local users. The announcement comes a month after TikTok was 261 00:14:13,020 --> 00:14:16,530 Sean Aylmer: banned on government devices. The company has also launched a 262 00:14:16,530 --> 00:14:18,570 Sean Aylmer: TV app, don't know whether you've caught that one yet. 263 00:14:18,780 --> 00:14:21,869 Sean Aylmer: Now, Facebook remains the most used social media platform in 264 00:14:21,870 --> 00:14:27,120 Sean Aylmer: Australia. About 74% of people who use social media use 265 00:14:27,210 --> 00:14:32,070 Sean Aylmer: Facebook. That's according to Meltwater. Next is Facebook Messenger, then 266 00:14:32,070 --> 00:14:36,179 Sean Aylmer: Instagram, then TikTok. And just as an aside on this 267 00:14:36,179 --> 00:14:40,650 Sean Aylmer: story, yesterday, Michael, Victorian premier Daniel Andrew said that the 268 00:14:40,650 --> 00:14:44,490 Sean Aylmer: Victorian government will scrap advertising in the printed newspapers of 269 00:14:44,490 --> 00:14:48,000 Sean Aylmer: Nine and News Corp, and pivot to online ads and 270 00:14:48,000 --> 00:14:50,490 Sean Aylmer: social media. Quite a change, Michael. 271 00:14:50,760 --> 00:14:54,690 Michael Thompson: Yes, it certainly is. That's a very significant change. And 272 00:14:54,690 --> 00:14:57,389 Michael Thompson: I'm also on Instagram at Michael Thompson Author as well. 273 00:14:57,900 --> 00:15:01,140 Sean Aylmer: Oh, shut up, Michael. Just finally a couple of sports 274 00:15:01,140 --> 00:15:03,930 Sean Aylmer: stories. We don't do anything normally. Rugby Australia has a 275 00:15:03,930 --> 00:15:06,900 Sean Aylmer: new boss, Phil Waugh. He played for the Wallabies 79 276 00:15:06,900 --> 00:15:10,920 Sean Aylmer: times, got the top job yesterday, and former Socceroos coach 277 00:15:10,920 --> 00:15:15,929 Sean Aylmer: and current Celtic manager in Scotland. Ange Postecoglou is reportedly 278 00:15:15,929 --> 00:15:20,010 Sean Aylmer: taking over as manager of British football giant Tottenham Hot 279 00:15:20,010 --> 00:15:23,850 Sean Aylmer: Spurs. He's gone from Melbourne victory to Tottenham Hot Spurs, 280 00:15:23,850 --> 00:15:27,719 Sean Aylmer: that is quite a rise. Good luck to both Phil 281 00:15:27,719 --> 00:15:29,100 Sean Aylmer: Waugh and Ange. 282 00:15:29,429 --> 00:15:31,770 Michael Thompson: Yeah. And anyone who's watched Ted Lasso now has an 283 00:15:31,770 --> 00:15:36,179 Michael Thompson: appreciation for what a manager of a British football team does. 284 00:15:36,360 --> 00:15:38,580 Sean Aylmer: I disagree with that. I think anyone that's watched Ted 285 00:15:38,580 --> 00:15:40,920 Sean Aylmer: Lasso has no idea what a football manager has to do. 286 00:15:40,920 --> 00:15:43,260 Michael Thompson: That's probably a very good point. I don't think Ted Lasso 287 00:15:43,260 --> 00:15:47,460 Michael Thompson: knows. In international news, Sean, the US Securities and Exchange 288 00:15:47,460 --> 00:15:52,410 Michael Thompson: Commission has accused Binance, the world's largest cryptocurrency exchange, of 289 00:15:52,410 --> 00:15:56,040 Michael Thompson: mishandling customer funds, as well as lying to regulators and 290 00:15:56,040 --> 00:15:59,910 Michael Thompson: investors about its operations, in a case filed in federal court. 291 00:16:00,300 --> 00:16:04,110 Sean Aylmer: The Wall Street Regulator claimed Binance had been mixing billions 292 00:16:04,110 --> 00:16:07,889 Sean Aylmer: of dollars in customer funds and secretly sending them to 293 00:16:07,889 --> 00:16:12,270 Sean Aylmer: a separate company called Merit Peak Limited, which is controlled 294 00:16:12,270 --> 00:16:17,310 Sean Aylmer: by Binance's founder Changpeng Zhao. Regulators said in the lawsuit 295 00:16:17,310 --> 00:16:20,790 Sean Aylmer: filed in the US District Court in Washington that Binance and 296 00:16:20,790 --> 00:16:25,289 Sean Aylmer: Zhao enriched themselves by billions of US dollars while placing 297 00:16:25,290 --> 00:16:29,399 Sean Aylmer: investors' assets at significant risk. In its court filing, the 298 00:16:29,399 --> 00:16:34,830 Sean Aylmer: SEC cited a 2018 email from Binance's chief compliance officer, saying, quote, " 299 00:16:35,190 --> 00:16:39,479 Sean Aylmer: We do not want binance. com to be regulated ever." 300 00:16:39,599 --> 00:16:41,760 Sean Aylmer: That's according to a report in The New York Times. 301 00:16:42,000 --> 00:16:44,609 Sean Aylmer: The charges against the big crypto exchange are the latest 302 00:16:44,610 --> 00:16:48,059 Sean Aylmer: actions by US regulators trying to reign in crypto trading. 303 00:16:48,840 --> 00:16:52,950 Michael Thompson: Sean, big news in the tech space, Apple has unveiled 304 00:16:52,950 --> 00:16:57,270 Michael Thompson: its long awaited mixed reality headset after more than seven 305 00:16:57,270 --> 00:17:00,450 Michael Thompson: years of development. And it vaults the company into a 306 00:17:00,450 --> 00:17:03,630 Michael Thompson: market that could someday transform computing. 307 00:17:03,960 --> 00:17:07,200 Sean Aylmer: The device, called Apple Vision Pro, was introduced at the 308 00:17:07,200 --> 00:17:12,658 Sean Aylmer: annual Worldwide Developers Conference in California. The headset, according to 309 00:17:12,660 --> 00:17:15,869 Sean Aylmer: Apple, is the next big thing for the company. The 310 00:17:15,869 --> 00:17:20,309 Sean Aylmer: wearable device mixes both virtual and augmented reality, meaning it 311 00:17:20,309 --> 00:17:22,979 Sean Aylmer: can fully engross the user in content with high resolution 312 00:17:22,980 --> 00:17:26,280 Sean Aylmer: displays, ideal for video watching. It also overlays apps on 313 00:17:26,280 --> 00:17:29,220 Sean Aylmer: top of the wearers' fields of view, letting messages and 314 00:17:29,220 --> 00:17:32,668 Sean Aylmer: notifications pop up. Plenty of other announcements as well. One 315 00:17:32,670 --> 00:17:35,070 Sean Aylmer: of the ones I really liked is that iPhone users 316 00:17:35,070 --> 00:17:38,129 Sean Aylmer: will be able to swap their contact details simply by 317 00:17:38,130 --> 00:17:41,580 Sean Aylmer: waving their phones next to each other, as part of 318 00:17:41,580 --> 00:17:43,980 Sean Aylmer: a major update to the phone software coming out in 319 00:17:44,070 --> 00:17:48,570 Sean Aylmer: September. That one is known as Name Drop. Anyway, back 320 00:17:48,570 --> 00:17:51,990 Sean Aylmer: to Apple Vision Pro, it's basically the company's first push 321 00:17:52,020 --> 00:17:54,929 Sean Aylmer: into a major new category since the Apple Watch was 322 00:17:54,929 --> 00:17:59,369 Sean Aylmer: launched back in 2015. Apple demonstrated the features and spotlighted 323 00:17:59,369 --> 00:18:02,820 Sean Aylmer: content planned for the product, which looks like high tech 324 00:18:02,820 --> 00:18:06,658 Sean Aylmer: ski goggles. It'll include games, interactive video from Walt Disney 325 00:18:06,660 --> 00:18:09,119 Sean Aylmer: Co. The price, Michael, will be about three and a 326 00:18:09,119 --> 00:18:12,780 Sean Aylmer: half thousand US dollars, that's about 5, 000 Aussie, higher than 327 00:18:12,780 --> 00:18:16,888 Sean Aylmer: most rival devices. It's expected to arrive in early 2024. 328 00:18:17,369 --> 00:18:19,408 Michael Thompson: That's pretty pricey, but still, I kind of want to 329 00:18:19,410 --> 00:18:20,250 Michael Thompson: have a go, don't you? 330 00:18:20,460 --> 00:18:21,900 Sean Aylmer: Ah, totally. Yeah, it'd be very cool. 331 00:18:22,140 --> 00:18:23,970 Michael Thompson: I think Fear and Greed needs to invest. 332 00:18:25,350 --> 00:18:27,420 Sean Aylmer: We'll have to ask Adam Lang whether he'll allow us to. 333 00:18:27,510 --> 00:18:29,550 Michael Thompson: Oh, good luck. I don't know whether we'll have much 334 00:18:29,550 --> 00:18:32,549 Michael Thompson: luck convincing Adam to let us buy a virtual reality 335 00:18:32,549 --> 00:18:36,089 Michael Thompson: headset and then claim it as a tax deduction. All 336 00:18:36,090 --> 00:18:39,270 Michael Thompson: right, finally, Sean, you did promise us a light story 337 00:18:39,270 --> 00:18:41,940 Michael Thompson: to finish on. This is a cracker. A wealthy driver 338 00:18:42,180 --> 00:18:48,418 Michael Thompson: has been fined 121, 000 euros, or nearly the equivalent of $ 200, 339 00:18:48,630 --> 00:18:54,480 Michael Thompson: 000, for speeding in Finland where penalties are apparently calculated 340 00:18:54,480 --> 00:18:56,280 Michael Thompson: on the basis of an offender's income. 341 00:18:56,280 --> 00:19:01,290 Sean Aylmer: I love this story. So the guy's name, Anders Wiklof, 342 00:19:02,429 --> 00:19:06,540 Sean Aylmer: is quoted in local media saying, " I really regret the matter." 343 00:19:07,349 --> 00:19:08,459 Michael Thompson: Yeah, I bet you do. 344 00:19:09,089 --> 00:19:12,929 Sean Aylmer: I bet he does. So Wiklof was driving 82 kilometers in 345 00:19:12,930 --> 00:19:16,020 Sean Aylmer: a 50 kilometer zone. It's not like he was doing 346 00:19:16,020 --> 00:19:18,720 Sean Aylmer: triple the speed limit here. He was doing 82 in a 50 kilometer 347 00:19:18,720 --> 00:19:22,198 Sean Aylmer: zone when police stopped and booked him over the weekend. 348 00:19:22,500 --> 00:19:25,320 Sean Aylmer: Along with a fine, he's had his driver's license suspended 349 00:19:25,320 --> 00:19:27,420 Sean Aylmer: for 10 days. I mean, the moral of this is 350 00:19:27,420 --> 00:19:30,329 Sean Aylmer: don't be too rich driving fast in Finland, clearly. 351 00:19:30,720 --> 00:19:32,130 Michael Thompson: Well, maybe he'll learn his lesson. 352 00:19:32,520 --> 00:19:34,438 Sean Aylmer: Well, he does have a bit of a track record, 353 00:19:34,440 --> 00:19:38,940 Sean Aylmer: because apparently back in 2018 he was fined about 64, 000 euros, 354 00:19:39,210 --> 00:19:43,678 Sean Aylmer: and five years earlier, about 95, 000 euros for more traffic 355 00:19:43,859 --> 00:19:48,270 Sean Aylmer: misdemeanors. He's chair of a holding company that includes businesses 356 00:19:48,270 --> 00:19:52,230 Sean Aylmer: in logistics, helicopter services, real estate trade, and tourism sectors. 357 00:19:52,500 --> 00:19:56,130 Sean Aylmer: So he's obviously very wealthy, but just his quote, at 358 00:19:56,130 --> 00:19:58,408 Sean Aylmer: the end of it, " I really regret the matter." 359 00:19:58,440 --> 00:20:00,840 Michael Thompson: Yeah, pretty simple solution. Slow down. 360 00:20:00,869 --> 00:20:01,050 Sean Aylmer: Yeah. 361 00:20:01,500 --> 00:20:04,080 Michael Thompson: All right. Up next is the Fear and Greed daily 362 00:20:04,080 --> 00:20:08,070 Michael Thompson: interview. You're speaking today with Elinor Kasapidis, the senior manager 363 00:20:08,070 --> 00:20:10,140 Michael Thompson: of tax policy at CPA Australia. 364 00:20:10,590 --> 00:20:12,840 Sean Aylmer: Yes. That's all about what you should be doing to 365 00:20:12,840 --> 00:20:14,490 Sean Aylmer: prepare for tax time when you're an investor. 366 00:20:14,880 --> 00:20:16,410 Michael Thompson: Yeah, it's a really good one. It's coming up next 367 00:20:16,410 --> 00:20:18,540 Michael Thompson: in the Fear and Greed playlist on your podcast platform 368 00:20:18,540 --> 00:20:20,609 Michael Thompson: or at fearandgreed. com. au, and is brought to you 369 00:20:20,609 --> 00:20:23,160 Michael Thompson: today by Stake, one of our supporters here at Fear 370 00:20:23,160 --> 00:20:23,579 Michael Thompson: and Greed. 371 00:20:23,879 --> 00:20:25,408 Sean Aylmer: Now Michael, it's a Wednesday. 372 00:20:26,160 --> 00:20:28,379 Michael Thompson: It is, which means one thing. 373 00:20:28,560 --> 00:20:32,190 Sean Aylmer: You have been plugging yourself nonstop all show. Keep going. 374 00:20:33,030 --> 00:20:35,969 Michael Thompson: Well, I mean, thank you for the opportunity, Sean. There 375 00:20:35,969 --> 00:20:39,000 Michael Thompson: is another podcast that comes out today, which is How 376 00:20:39,000 --> 00:20:42,449 Michael Thompson: Do They Afford That, our sister podcast, which features Canna 377 00:20:42,449 --> 00:20:45,270 Michael Thompson: Campbell, the founder of Sugar Mama TV, and of course 378 00:20:45,270 --> 00:20:49,260 Michael Thompson: me as well. And funnily enough, the episode today, it's 379 00:20:49,260 --> 00:20:51,388 Michael Thompson: almost as though we timed this and planned this, it's 380 00:20:51,388 --> 00:20:54,180 Michael Thompson: all about tax time is on its way. And so 381 00:20:54,359 --> 00:20:58,888 Michael Thompson: it's less focusing specifically on for investors and shares, and 382 00:20:58,888 --> 00:21:02,040 Michael Thompson: more broadly on things that you can be doing just 383 00:21:02,040 --> 00:21:05,550 Michael Thompson: to get ready, just to make sure you're maximizing the 384 00:21:05,550 --> 00:21:08,010 Michael Thompson: opportunities here. So you can find that, How Do They 385 00:21:08,010 --> 00:21:10,859 Michael Thompson: Afford That, wherever you listen to podcasts. And we'll also 386 00:21:10,859 --> 00:21:12,989 Michael Thompson: put a link in today's show notes. There we go 387 00:21:12,990 --> 00:21:14,248 Michael Thompson: Sean, thank you very much. 388 00:21:14,520 --> 00:21:15,329 Sean Aylmer: Thank you, Michael. 389 00:21:15,388 --> 00:21:18,418 Michael Thompson: It's Wednesday, the 7th of June 2023. Make sure you're 390 00:21:18,420 --> 00:21:22,140 Michael Thompson: following the podcast, and join us online on LinkedIn, Instagram, Twitter, 391 00:21:22,140 --> 00:21:24,119 Michael Thompson: and Facebook. And stay up to date on all the 392 00:21:24,119 --> 00:21:27,090 Michael Thompson: business news with Alexa and your Amazon Echo Smart speaker. 393 00:21:27,090 --> 00:21:29,460 Michael Thompson: Simply say, " Alexa, play the Fear and Greed podcast," to 394 00:21:29,460 --> 00:21:32,310 Michael Thompson: catch the latest episode. Get yours now at amazon. com. 395 00:21:32,880 --> 00:21:35,218 Michael Thompson: au. I'm Michael Thompson, and that was Fear and Greed. 396 00:21:35,520 --> 00:21:36,060 Michael Thompson: Have a great day.