1 00:00:03,900 --> 00:00:07,650 Michael Thompson: Australia is heading towards a recession according to market economists. 2 00:00:07,920 --> 00:00:11,880 Michael Thompson: The global bosses of PWC take over the Australian operations 3 00:00:11,880 --> 00:00:14,699 Michael Thompson: in an effort to stem the crisis engulfing the firm. 4 00:00:15,030 --> 00:00:19,200 Michael Thompson: And Vladimir Putin seriously weakened after an aborted coup over 5 00:00:19,200 --> 00:00:23,970 Michael Thompson: the weekend. It's Monday the 26th of June 2023. Welcome 6 00:00:23,970 --> 00:00:27,480 Michael Thompson: to Fear and Greed. Australia's most popular business podcast. I'm 7 00:00:27,480 --> 00:00:29,850 Michael Thompson: Michael Thompson, and good morning, Sean Aylmer. 8 00:00:30,300 --> 00:00:33,839 Sean Aylmer: Good morning, Michael. What a crazy weekend for news. 9 00:00:33,960 --> 00:00:36,149 Michael Thompson: Oh, it's been a massive couple of days, hasn't it? 10 00:00:36,150 --> 00:00:39,690 Michael Thompson: And it's just been, and international stories and local stories, 11 00:00:39,690 --> 00:00:40,890 Michael Thompson: it's just been unfolding. 12 00:00:41,010 --> 00:00:42,030 Sean Aylmer: So much going on. 13 00:00:42,390 --> 00:00:44,159 Michael Thompson: It is. And we've got an interview coming up after 14 00:00:44,159 --> 00:00:48,059 Michael Thompson: the show. One of our favorite guests, Elise Kennedy from Jarden. 15 00:00:48,360 --> 00:00:50,668 Sean Aylmer: Yes. We talked to Elise all about this tech stocks. 16 00:00:50,670 --> 00:00:53,789 Sean Aylmer: We start on Wall Street, companies like Nvidia, et cetera, 17 00:00:53,789 --> 00:00:57,000 Sean Aylmer: how they're going, but then we go pretty specific in 18 00:00:57,000 --> 00:01:00,000 Sean Aylmer: terms of what the company outlooks are like for in 19 00:01:00,000 --> 00:01:02,910 Sean Aylmer: Australian. These are Australian listed stocks, of course. So if 20 00:01:02,910 --> 00:01:06,029 Sean Aylmer: you're interested in investing, you certainly get your own advice, 21 00:01:06,030 --> 00:01:08,579 Sean Aylmer: but also listen to Elise and what she thinks about them. 22 00:01:08,789 --> 00:01:10,590 Michael Thompson: Yeah. It's always a good chat with Elise, because she 23 00:01:10,590 --> 00:01:12,929 Michael Thompson: just goes through so many different companies and it's well 24 00:01:12,959 --> 00:01:15,330 Michael Thompson: worth a listen if you're an investor. The main story 25 00:01:15,330 --> 00:01:18,150 Michael Thompson: this morning though, Sean, the Australian economy is facing a 26 00:01:18,150 --> 00:01:21,149 Michael Thompson: recession with the ongoing hikes in interest rates and the 27 00:01:21,150 --> 00:01:24,450 Michael Thompson: potential for more, likely to stop the economy from growing. 28 00:01:24,870 --> 00:01:27,839 Sean Aylmer: That's according to several market economists who are now calling 29 00:01:27,839 --> 00:01:30,389 Sean Aylmer: on the Reserve Bank to stop lifting rates. One of 30 00:01:30,389 --> 00:01:33,840 Sean Aylmer: the most vocal is AMP's Shane Oliver, who says the 31 00:01:33,840 --> 00:01:37,140 Sean Aylmer: risk of recession in Australia is now very high. He 32 00:01:37,140 --> 00:01:39,179 Sean Aylmer: says the Reserve Bank has already done enough to slow 33 00:01:39,179 --> 00:01:42,329 Sean Aylmer: the economy and bring inflation back to target, and we 34 00:01:42,330 --> 00:01:45,360 Sean Aylmer: are seeing clear evidence of slowing demand in terms of 35 00:01:45,360 --> 00:01:50,460 Sean Aylmer: falling retail sales, falling building approvals, slowing plans for growth 36 00:01:50,460 --> 00:01:54,840 Sean Aylmer: in business investment, slowing economic growth, and early indications of 37 00:01:54,840 --> 00:01:57,479 Sean Aylmer: a slowing jobs market. He wants the Central Bank to 38 00:01:57,480 --> 00:02:00,690 Sean Aylmer: stay on hold for a few months to judge what's 39 00:02:00,690 --> 00:02:02,910 Sean Aylmer: going on, but he isn't confident that they'll do it. 40 00:02:03,420 --> 00:02:06,510 Sean Aylmer: Westpac's Bill Evans expects more rate hikes, because of the 41 00:02:06,510 --> 00:02:10,230 Sean Aylmer: resilience of the labor market. While he isn't quite forecasting 42 00:02:10,290 --> 00:02:13,230 Sean Aylmer: a recession yet, he says there's a high degree of 43 00:02:13,230 --> 00:02:16,469 Sean Aylmer: uncertainty around. Commonwealth Bank's Gareth Aird puts a chance of 44 00:02:16,469 --> 00:02:20,160 Sean Aylmer: recession at about 50%. National Australia Bank's Alan Oster has 45 00:02:20,160 --> 00:02:23,549 Sean Aylmer: warned two more rate risers and a heavy hit on 46 00:02:23,549 --> 00:02:27,180 Sean Aylmer: the economy. There's plenty more who now think that we 47 00:02:27,180 --> 00:02:28,260 Sean Aylmer: are heading for a recession. 48 00:02:28,680 --> 00:02:32,880 Michael Thompson: Sean, obviously the Reserve Bank is independent, but do these 49 00:02:33,030 --> 00:02:36,570 Michael Thompson: opinions, these external opinions, because these are heavyweights in terms 50 00:02:36,570 --> 00:02:40,500 Michael Thompson: of market economists. Does the Reserve Bank listen at all 51 00:02:40,500 --> 00:02:41,460 Michael Thompson: to what's being said? 52 00:02:41,820 --> 00:02:44,250 Sean Aylmer: For sure. They do their own analysis, and there is 53 00:02:44,250 --> 00:02:47,310 Sean Aylmer: no better machine in terms of analyzing the economy than 54 00:02:47,310 --> 00:02:50,429 Sean Aylmer: the Reserve Bank. They have dozens and dozens of economists, 55 00:02:50,429 --> 00:02:53,130 Sean Aylmer: and so guys like Bill Evans and Shane Oliver and 56 00:02:53,250 --> 00:02:54,990 Sean Aylmer: Alan Oster, they've been around for a long time, but 57 00:02:55,049 --> 00:02:58,079 Sean Aylmer: they're limited in terms of how many people they've got 58 00:02:58,079 --> 00:03:01,860 Sean Aylmer: working to predict the economy. They have great experience, of 59 00:03:01,860 --> 00:03:04,080 Sean Aylmer: course, and there is no doubt that the Reserve Bank 60 00:03:04,169 --> 00:03:06,360 Sean Aylmer: is interested in what these guys are saying, but at 61 00:03:06,360 --> 00:03:08,070 Sean Aylmer: the end of the day, the Reserve Bank is independent 62 00:03:08,070 --> 00:03:10,889 Sean Aylmer: and will make its own decision based on the work 63 00:03:10,889 --> 00:03:11,310 Sean Aylmer: it's done. 64 00:03:12,059 --> 00:03:15,270 Michael Thompson: All right. So when then is the recession likely to hit? 65 00:03:15,508 --> 00:03:18,538 Sean Aylmer: Well, it's a very good question. Economics isn't an exact 66 00:03:18,570 --> 00:03:20,640 Sean Aylmer: science. Michael, you might have worked that one out. 67 00:03:20,970 --> 00:03:22,799 Michael Thompson: I have gathered that now. Yes. 68 00:03:23,220 --> 00:03:27,540 Sean Aylmer: And recession sometimes actually happen in hindsight. So for example, 69 00:03:27,540 --> 00:03:31,650 Sean Aylmer: the most recent GDP figures suggest there was a per 70 00:03:31,650 --> 00:03:35,850 Sean Aylmer: capita contraction in the March quarter. So growth per person. 71 00:03:35,850 --> 00:03:38,040 Sean Aylmer: The only reason we didn't actually have a recession was 72 00:03:38,130 --> 00:03:40,440 Sean Aylmer: because we had lots of immigration. But if you look 73 00:03:40,440 --> 00:03:44,340 Sean Aylmer: at growth per person, we actually went backwards in March. 74 00:03:44,820 --> 00:03:47,490 Sean Aylmer: So if this happens this quarter, that would make two 75 00:03:47,490 --> 00:03:50,040 Sean Aylmer: in a row, and that's classed as a per capita 76 00:03:50,250 --> 00:03:55,920 Sean Aylmer: recession. Broadly though, economists think that people will truly feel 77 00:03:55,950 --> 00:03:58,950 Sean Aylmer: the slowdown in the second half of this year and 78 00:03:58,950 --> 00:04:02,190 Sean Aylmer: into next year into 2024 so much so that some 79 00:04:02,190 --> 00:04:05,910 Sean Aylmer: actually think interest rates could start falling next year as 80 00:04:05,910 --> 00:04:09,420 Sean Aylmer: the Reserve Bank tries to reverse what it's done to 81 00:04:09,420 --> 00:04:13,590 Sean Aylmer: boost the economy. So probably in the next six months 82 00:04:13,590 --> 00:04:14,850 Sean Aylmer: or so, if it does happen. 83 00:04:15,330 --> 00:04:18,390 Michael Thompson: All right. So recession looking more likely and really not 84 00:04:18,390 --> 00:04:20,128 Michael Thompson: starting the week off on good news, are we? 85 00:04:20,219 --> 00:04:21,059 Sean Aylmer: No. Sorry. 86 00:04:21,928 --> 00:04:21,929 Michael Thompson: That's all right. 87 00:04:21,929 --> 00:04:22,890 Sean Aylmer: A very bad start. 88 00:04:23,160 --> 00:04:25,799 Michael Thompson: Well, what about last week? How did the markets, local 89 00:04:25,799 --> 00:04:27,029 Michael Thompson: markets finish up on Friday? 90 00:04:27,480 --> 00:04:29,370 Sean Aylmer: Well, this doesn't improve the conversation either. 91 00:04:29,699 --> 00:04:30,089 Michael Thompson: Oh, great. 92 00:04:30,299 --> 00:04:32,549 Sean Aylmer: I mean the week started pretty well last week, but 93 00:04:32,550 --> 00:04:36,270 Sean Aylmer: it finished really poorly. The S&P, ASX 200 closed down 1. 3% 94 00:04:36,570 --> 00:04:40,558 Sean Aylmer: on Friday to just under 7100 points. For the week, 95 00:04:40,559 --> 00:04:43,230 Sean Aylmer: it was off a couple of percent. Fears of a recession 96 00:04:43,290 --> 00:04:45,570 Sean Aylmer: has pushed the oil and gas companies lower. This is 97 00:04:45,570 --> 00:04:48,480 Sean Aylmer: more of a global recession fears. Woodside fell nearly 5%, 98 00:04:48,870 --> 00:04:52,229 Sean Aylmer: Central dropped more than 4%. ANZ was off more than 2%. 99 00:04:52,529 --> 00:04:55,290 Sean Aylmer: Commonwealth Bank, Westpac, Macquarie Bank, National Australia Bank, they weren't 100 00:04:55,290 --> 00:04:59,490 Sean Aylmer: far behind. Other under performers included UK based Virgin Money, 101 00:04:59,490 --> 00:05:03,360 Sean Aylmer: which tumbled 4% after yet another rate rise in Britain. 102 00:05:03,660 --> 00:05:06,660 Sean Aylmer: And Gold Road Resources was off 5% following a production 103 00:05:06,660 --> 00:05:09,900 Sean Aylmer: downgrade earlier in the week. One just of interest was 104 00:05:09,900 --> 00:05:14,339 Sean Aylmer: Cochlear. Its share price fell more than 3% after British 105 00:05:14,339 --> 00:05:17,670 Sean Aylmer: regulator, the Competition and Markets Authority said the ear implant 106 00:05:17,730 --> 00:05:23,490 Sean Aylmer: groups $ 170 million acquisition of a Danish hearing business doesn't 107 00:05:23,549 --> 00:05:28,020 Sean Aylmer: raise competition concerns or good, but the regulator prohibited Cochlear 108 00:05:28,290 --> 00:05:31,020 Sean Aylmer: from buying part of that business, which is actually a 109 00:05:31,020 --> 00:05:35,669 Sean Aylmer: UK business. This UK bone conduction implants business, it'll have 110 00:05:35,670 --> 00:05:38,009 Sean Aylmer: to rid itself of that Cochlear if it wants to 111 00:05:38,009 --> 00:05:40,590 Sean Aylmer: buy the Danish business that's in its share price lower. 112 00:05:41,279 --> 00:05:43,349 Michael Thompson: All right. And what's happening on international markets? 113 00:05:43,680 --> 00:05:46,620 Sean Aylmer: Well, worth mentioning Bitcoin. It had one of its strongest 114 00:05:46,620 --> 00:05:49,860 Sean Aylmer: weeks of the year last year helped by speculation that 115 00:05:49,860 --> 00:05:54,000 Sean Aylmer: proposed exchange traded funds heralds a whole new source of 116 00:05:54,000 --> 00:05:57,239 Sean Aylmer: demand for the largest digital asset. The token was up 117 00:05:57,240 --> 00:06:00,449 Sean Aylmer: more than 25% last week. It's nearly doubled so far 118 00:06:00,450 --> 00:06:05,039 Sean Aylmer: this year. Smaller coins like XRP, Cardano and Solana have also 119 00:06:05,040 --> 00:06:08,790 Sean Aylmer: done much better. BlackRock last week said it's interested in 120 00:06:08,790 --> 00:06:13,439 Sean Aylmer: developing an ETF for Bitcoin. It put an application into 121 00:06:13,440 --> 00:06:15,690 Sean Aylmer: the Securities and Exchange Commission. It's just one of a 122 00:06:15,690 --> 00:06:19,169 Sean Aylmer: number of US applicants for that, hence, we're seeing some 123 00:06:19,199 --> 00:06:22,380 Sean Aylmer: support for cryptos. In equity markets, all three major Wall 124 00:06:22,380 --> 00:06:24,960 Sean Aylmer: Street indices finished lower over the weekend on the back 125 00:06:24,960 --> 00:06:27,808 Sean Aylmer: of lingering worries about a recession and comments from the 126 00:06:27,809 --> 00:06:31,320 Sean Aylmer: Federal Reserve chair, Jerome Powell, that rates may still have 127 00:06:31,320 --> 00:06:34,410 Sean Aylmer: to rise. The Dow Jones Industrial Average, the S& P 128 00:06:34,410 --> 00:06:37,229 Sean Aylmer: 500 and tech heavy Nasdaq all fell by around 2% 129 00:06:37,529 --> 00:06:40,770 Sean Aylmer: last week. The Aussie dollar fell further against US dollar 130 00:06:40,770 --> 00:06:44,220 Sean Aylmer: over the weekend. It's trading just under 67 US cents. 131 00:06:44,639 --> 00:06:46,830 Michael Thompson: There's plenty happening, Sean. I think the big question here, 132 00:06:46,830 --> 00:06:48,599 Michael Thompson: is my voice going to hold out- 133 00:06:48,870 --> 00:06:48,871 Sean Aylmer: Yes. 134 00:06:48,871 --> 00:06:51,029 Michael Thompson: ... until the end of the episode? I'm getting progressively 135 00:06:51,029 --> 00:06:51,840 Michael Thompson: worse, aren't I? 136 00:06:52,049 --> 00:06:54,089 Sean Aylmer: Well, you had a very big weekend with the book 137 00:06:54,089 --> 00:06:57,029 Sean Aylmer: launch on Friday night. You've got being launched in the 138 00:06:57,029 --> 00:07:00,990 Sean Aylmer: US on Wednesday, Look, I think it's all your fault 139 00:07:01,290 --> 00:07:04,049 Sean Aylmer: that you've losing your voice, Michael, to be perfectly honest. 140 00:07:04,410 --> 00:07:07,138 Michael Thompson: I have no one else to blame, but I have so much 141 00:07:07,139 --> 00:07:09,870 Michael Thompson: kind of tea and there's like all these home remedies, 142 00:07:10,020 --> 00:07:11,910 Michael Thompson: and when you work in radio for a while, you 143 00:07:12,150 --> 00:07:15,450 Michael Thompson: hear all of these remedies over time. And the one 144 00:07:15,450 --> 00:07:18,900 Michael Thompson: that kind of seems to work best is tea with 145 00:07:18,900 --> 00:07:19,620 Michael Thompson: lemon and honey. 146 00:07:20,190 --> 00:07:20,400 Sean Aylmer: Really? 147 00:07:20,400 --> 00:07:22,590 Michael Thompson: Which is actually very, very refreshing. And you put a 148 00:07:22,590 --> 00:07:24,510 Michael Thompson: little bit of ginger in there and it becomes very, 149 00:07:24,630 --> 00:07:25,470 Michael Thompson: very nice actually. 150 00:07:26,639 --> 00:07:28,830 Sean Aylmer: Lemon and ginger tea. There you go. Who would've thought? 151 00:07:29,340 --> 00:07:31,110 Michael Thompson: I'm starting to sound like you, aren't I? 152 00:07:31,110 --> 00:07:32,730 Sean Aylmer: Yeah. Sure. I'm so proud. So proud. 153 00:07:33,240 --> 00:07:34,710 Michael Thompson: Oh, goodness me. All right. We'll be back in a 154 00:07:34,710 --> 00:07:42,870 Michael Thompson: moment with the rest of the day's business news. Sean, 155 00:07:42,870 --> 00:07:46,529 Michael Thompson: the global leaders of PWC have taken control of the 156 00:07:46,529 --> 00:07:51,060 Michael Thompson: Australian business pushing aside the local CEO who's been acting 157 00:07:51,060 --> 00:07:52,620 Michael Thompson: in the position for just seven weeks. 158 00:07:53,010 --> 00:07:56,760 Sean Aylmer: In a demonstration of how worried the global partnership is 159 00:07:56,760 --> 00:08:00,389 Sean Aylmer: about what's happened in Australia, a Singaporean- based manager will 160 00:08:00,389 --> 00:08:05,159 Sean Aylmer: take the reigns locally. The firm's global chair, Bob Moritz said, " 161 00:08:05,160 --> 00:08:09,360 Sean Aylmer: PWC Australia had failed to meet the network's code of 162 00:08:09,360 --> 00:08:13,739 Sean Aylmer: conduct and uphold the network's professional standards and values. That 163 00:08:13,740 --> 00:08:16,319 Sean Aylmer: is under the previous leadership. Of course, he added its 164 00:08:16,320 --> 00:08:19,349 Sean Aylmer: past actions are not representative of the work and behaviors 165 00:08:19,349 --> 00:08:22,080 Sean Aylmer: of PWC around the world. And I'm deeply sorry to 166 00:08:22,080 --> 00:08:26,640 Sean Aylmer: our clients, our broader stakeholders and our people. PWC Australia 167 00:08:26,640 --> 00:08:29,670 Sean Aylmer: has significant work to do, and I'm confident that the 168 00:08:29,670 --> 00:08:32,309 Sean Aylmer: steps they're taking with the network support will result in 169 00:08:32,309 --> 00:08:35,730 Sean Aylmer: a stronger firms." It comes as the AFR reports that 170 00:08:35,730 --> 00:08:39,059 Sean Aylmer: the local PWC business is planning to sell off its 171 00:08:39,059 --> 00:08:42,000 Sean Aylmer: government consulting arm, which is where all the problems arose, 172 00:08:42,240 --> 00:08:45,840 Sean Aylmer: to a private equity investor, Allegro Funds, for the sum 173 00:08:45,840 --> 00:08:50,160 Sean Aylmer: of $ 1. This is happening while the firm is trying 174 00:08:50,160 --> 00:08:53,639 Sean Aylmer: to convince dozens of partners to move into retirement, and 175 00:08:53,639 --> 00:08:56,490 Sean Aylmer: it wants to retreat to core auditing management, consulting, and 176 00:08:56,490 --> 00:08:57,720 Sean Aylmer: tax compliance work. 177 00:08:58,320 --> 00:09:01,650 Michael Thompson: Sean, the PWC saga has really hit the whole industry 178 00:09:01,650 --> 00:09:04,228 Michael Thompson: now, hasn't it? Because the partnership structure of the big 179 00:09:04,230 --> 00:09:09,750 Michael Thompson: four consulting firms, Deloitte, EY, KPMG, and PWC, and how they operate 180 00:09:09,870 --> 00:09:12,598 Michael Thompson: is all becoming the subject of a parliamentary inquiry with 181 00:09:12,599 --> 00:09:15,060 Michael Thompson: the potential for new penalties for poor behavior. 182 00:09:15,420 --> 00:09:18,780 Sean Aylmer: So the PWC tax scandal, which of course listeners will 183 00:09:18,929 --> 00:09:21,900 Sean Aylmer: remind you once again, it's where the firm used information 184 00:09:21,900 --> 00:09:24,750 Sean Aylmer: gained from working with the government to help multinationals avoid 185 00:09:24,750 --> 00:09:28,620 Sean Aylmer: tax. That scandal has triggered the inquiry by the Parliamentary 186 00:09:28,620 --> 00:09:32,910 Sean Aylmer: Joint Committee on Corporations and Financial Services, Labor Senator Deborah 187 00:09:32,910 --> 00:09:35,549 Sean Aylmer: O'Neill chairs the committee. She said the big four are 188 00:09:35,549 --> 00:09:38,819 Sean Aylmer: no longer operating as envisaged. So a major review of 189 00:09:38,820 --> 00:09:41,850 Sean Aylmer: the sector is needed. Now the inquiry will consider partnership 190 00:09:41,850 --> 00:09:46,110 Sean Aylmer: structures, examine gaps in reporting obligations, inquire into fit and 191 00:09:46,110 --> 00:09:50,490 Sean Aylmer: proper person requirements and prevailing cultural practices, and also the 192 00:09:50,490 --> 00:09:53,130 Sean Aylmer: regulatory regime that partnerships currently operate under. 193 00:09:53,910 --> 00:09:57,300 Michael Thompson: All right. Now, Sean, the federal government is proposing new 194 00:09:57,300 --> 00:10:01,710 Michael Thompson: legislation, including penalties of close to $ 7 million for digital 195 00:10:01,710 --> 00:10:06,120 Michael Thompson: platforms failing to address systemic disinformation and misinformation. 196 00:10:06,480 --> 00:10:09,389 Sean Aylmer: Yes. This is getting quite a big run around the world in terms 197 00:10:09,389 --> 00:10:12,960 Sean Aylmer: of news, mostly because the government is trying to stop 198 00:10:13,230 --> 00:10:17,010 Sean Aylmer: this flood of disinformation on the social media platforms that 199 00:10:17,010 --> 00:10:19,860 Sean Aylmer: so many people use. So the government's released a draft 200 00:10:19,860 --> 00:10:23,789 Sean Aylmer: framework to empower the Australian Communications and Media Authority to 201 00:10:23,790 --> 00:10:28,049 Sean Aylmer: hold digital platforms responsible for misleading or deliberately deceptive information 202 00:10:28,049 --> 00:10:34,050 Sean Aylmer: online. Minister of Communications Michelle Rowland said the proposed legislation 203 00:10:34,260 --> 00:10:37,950 Sean Aylmer: was aimed at protecting Australians from the growing threat. For 204 00:10:37,950 --> 00:10:42,000 Sean Aylmer: the first time, ACMA will be empowered to access documents 205 00:10:42,000 --> 00:10:46,289 Sean Aylmer: from digital providers related to misinformation and disinformation on their 206 00:10:46,289 --> 00:10:49,679 Sean Aylmer: platforms. The proposed authority would not extend to the content 207 00:10:49,679 --> 00:10:52,740 Sean Aylmer: of private messages sent online, but it would in the 208 00:10:52,740 --> 00:10:55,650 Sean Aylmer: public sphere. So it'll be very interesting to watch this one. 209 00:10:56,070 --> 00:11:00,120 Michael Thompson: Now, Sean, Labor has watered down plans to force multinational 210 00:11:00,120 --> 00:11:05,578 Michael Thompson: companies to disclose an unprecedented level of tax information opting 211 00:11:05,580 --> 00:11:07,980 Michael Thompson: to follow less onerous international standards. 212 00:11:08,190 --> 00:11:09,840 Sean Aylmer: Yes. It's a bit of a win for big business. 213 00:11:09,840 --> 00:11:13,290 Sean Aylmer: This one global fund manages and Australian companies including medical 214 00:11:13,290 --> 00:11:17,160 Sean Aylmer: giants like Cochlear and CSL warned the Albanese government's proposed 215 00:11:17,460 --> 00:11:20,250 Sean Aylmer: country by country tax reporting rules that were supposed to 216 00:11:20,250 --> 00:11:25,079 Sean Aylmer: start next week. Those rules risk exposing sensitive commercial data 217 00:11:25,110 --> 00:11:30,150 Sean Aylmer: to competitors and undermining cooperation by international revenue authorities according 218 00:11:30,150 --> 00:11:34,020 Sean Aylmer: to the financial review. About 2500 multinational entities with Australian 219 00:11:34,020 --> 00:11:38,099 Sean Aylmer: activities would have been required to publicly disclose their approach 220 00:11:38,099 --> 00:11:40,950 Sean Aylmer: to tax compliance, their effective tax rate in each country, 221 00:11:41,250 --> 00:11:45,570 Sean Aylmer: where they do business, expenses from related party transactions, and 222 00:11:45,660 --> 00:11:49,319 Sean Aylmer: a list of intangible assets held by their operations. But 223 00:11:49,320 --> 00:11:53,280 Sean Aylmer: amended legislation introduced into Parliament last week basically winds that 224 00:11:53,280 --> 00:11:57,480 Sean Aylmer: back quite significantly. The government's also opted to delay application 225 00:11:57,480 --> 00:12:00,480 Sean Aylmer: of the new laws by 12 months. So certainly a 226 00:12:00,720 --> 00:12:02,520 Sean Aylmer: big win for big business. 227 00:12:02,700 --> 00:12:04,439 Michael Thompson: And a very late change, isn't it? 228 00:12:05,160 --> 00:12:07,080 Sean Aylmer: Very late given they've only got a week to go. 229 00:12:07,230 --> 00:12:10,078 Michael Thompson: Yeah. I can understand delaying the application of the new 230 00:12:10,080 --> 00:12:12,119 Michael Thompson: laws by 12 months. (inaudible) , " We just need some 231 00:12:12,120 --> 00:12:13,290 Michael Thompson: time to work through this." 232 00:12:13,410 --> 00:12:14,250 Sean Aylmer: Yeah. Absolutely. 233 00:12:14,849 --> 00:12:17,070 Michael Thompson: Now, Sean, last one before we get to international news. 234 00:12:17,070 --> 00:12:19,500 Michael Thompson: The corporate regulator has had a crack at the major 235 00:12:19,500 --> 00:12:24,750 Michael Thompson: insurers saying they had probably ripped off customers with pricing, 236 00:12:24,750 --> 00:12:26,850 Michael Thompson: but made no effort to refund them. 237 00:12:27,690 --> 00:12:30,270 Sean Aylmer: The review into why insurers have failed to pass on 238 00:12:30,270 --> 00:12:34,529 Sean Aylmer: at least $ 815 million in promised discounts or awards since 239 00:12:34,529 --> 00:12:38,010 Sean Aylmer: 2018 was published on Friday. And while insurers are now 240 00:12:38,010 --> 00:12:43,350 Sean Aylmer: repaying customers, ASIC has a warning. The industry is potentially 241 00:12:43,350 --> 00:12:48,270 Sean Aylmer: making misleading, " misleading" being the operative word here, representations by 242 00:12:48,270 --> 00:12:51,838 Sean Aylmer: charging some customers more because they know they won't shop 243 00:12:51,870 --> 00:12:56,429 Sean Aylmer: around, while also promising a loyalty discount. The report says 244 00:12:56,429 --> 00:13:00,210 Sean Aylmer: that pricing failure since 2018 were most at IAG and valued 245 00:13:00,210 --> 00:13:06,150 Sean Aylmer: at $ 447 million. Then, RACQ insurance valued at $ 222 million, 246 00:13:06,750 --> 00:13:10,230 Sean Aylmer: and QBE valued at $ 90 million. Mostly the failures were 247 00:13:10,230 --> 00:13:14,010 Sean Aylmer: inaccurate discount descriptions in documents and errors in the pricing system. 248 00:13:14,610 --> 00:13:17,880 Michael Thompson: All right. International news now. Big story developing over the 249 00:13:17,880 --> 00:13:21,390 Michael Thompson: weekend, Sean. Russian leader, Vladimir Putin's hold on his country 250 00:13:21,630 --> 00:13:25,080 Michael Thompson: has been badly damaged by the aborted coup against him 251 00:13:25,500 --> 00:13:28,949 Michael Thompson: with the path ahead over the next few months. Well, 252 00:13:28,949 --> 00:13:30,360 Michael Thompson: really very uncertain, isn't it? 253 00:13:30,720 --> 00:13:34,500 Sean Aylmer: Sure is. The head of the Wagner Group, Yevgeny Prigozhin 254 00:13:34,590 --> 00:13:37,468 Sean Aylmer: said he had called off the advance of troops on 255 00:13:37,470 --> 00:13:41,880 Sean Aylmer: the Russian capital to avoid bloodshed. Kind of ironic, really, 256 00:13:41,940 --> 00:13:44,069 Sean Aylmer: because the group is a bunch of mercenaries that kill 257 00:13:44,070 --> 00:13:46,468 Sean Aylmer: for a living. Anyway, that was the reason he gave. 258 00:13:46,859 --> 00:13:50,670 Sean Aylmer: Fighters had reached within 120 miles of Moscow. The capital's 259 00:13:50,670 --> 00:13:53,880 Sean Aylmer: mayor told Russian residents to remain at home. He gave 260 00:13:53,880 --> 00:13:56,400 Sean Aylmer: them a day off as they braced for the arrival 261 00:13:56,400 --> 00:13:59,490 Sean Aylmer: of these troops. Now, back on Friday, Prigozhin calls for 262 00:13:59,490 --> 00:14:02,969 Sean Aylmer: an uprising against military leaders. He said he had 25,000 263 00:14:02,969 --> 00:14:05,578 Sean Aylmer: fighters ready to battle the Russian Army and called on 264 00:14:05,580 --> 00:14:08,850 Sean Aylmer: regular Russian soldiers, including the National Guard to join his 265 00:14:08,850 --> 00:14:13,920 Sean Aylmer: coup attempt. A truce was apparently brokered by the Belarusian 266 00:14:13,920 --> 00:14:18,300 Sean Aylmer: president. Putin called it treason over the weekend, but then 267 00:14:18,300 --> 00:14:21,900 Sean Aylmer: backed down. He allowed Prigozhin to be exiled to Belarus 268 00:14:22,559 --> 00:14:25,950 Sean Aylmer: as part of that truce. The general consensus this morning, 269 00:14:25,950 --> 00:14:28,980 Sean Aylmer: Michael, seems to be that the coup has demonstrated the 270 00:14:28,980 --> 00:14:34,440 Sean Aylmer: deep cracks within Russian politics, but particularly within the military, 271 00:14:35,040 --> 00:14:38,250 Sean Aylmer: and put that next to the failed invasion of Ukraine, 272 00:14:38,580 --> 00:14:43,740 Sean Aylmer: Vladimir Putin's position has been severely weakened. He's now under 273 00:14:43,740 --> 00:14:46,980 Sean Aylmer: threat as far as some people are saying. I suppose 274 00:14:46,980 --> 00:14:50,010 Sean Aylmer: it makes for a very, very volatile few months ahead, 275 00:14:50,190 --> 00:14:51,270 Sean Aylmer: which is quite scary. 276 00:14:51,450 --> 00:14:56,010 Michael Thompson: Yeah. Certainly is. Sean, Facebook and Instagram users in Canada 277 00:14:56,040 --> 00:15:00,570 Michael Thompson: will be blocked from viewing Canadian news according to Facebook's 278 00:15:00,570 --> 00:15:04,290 Michael Thompson: parent company, Meta. This is after Ottawa passed a bill 279 00:15:04,290 --> 00:15:07,020 Michael Thompson: requiring digital giants to pay for such content. 280 00:15:07,530 --> 00:15:11,129 Sean Aylmer: Yes. Google, another critic of Canada's online News Act has 281 00:15:11,130 --> 00:15:14,549 Sean Aylmer: previously said it's considering a similar move to what Meta's 282 00:15:14,549 --> 00:15:17,369 Sean Aylmer: doing. The two tech giants have pushed back against the 283 00:15:17,369 --> 00:15:20,850 Sean Aylmer: bill, which aims to support a struggling Canadian news sector 284 00:15:21,120 --> 00:15:23,580 Sean Aylmer: that has seen hundreds of publications closed in the last 285 00:15:23,580 --> 00:15:27,059 Sean Aylmer: decade. Sounds very familiar. In recent days, the bill has 286 00:15:27,059 --> 00:15:29,609 Sean Aylmer: passed the final hurdle in the Senate in Canada. It 287 00:15:29,610 --> 00:15:32,669 Sean Aylmer: will become law. Canadian government officials have met with Facebook 288 00:15:32,670 --> 00:15:35,730 Sean Aylmer: and Google. They say they're looking forward to further discussions 289 00:15:35,730 --> 00:15:39,270 Sean Aylmer: about the new law, but Facebook's parent, Meta and Google 290 00:15:39,270 --> 00:15:43,680 Sean Aylmer: are taking pretty drastic action by stopping news being viewed. 291 00:15:44,880 --> 00:15:47,609 Michael Thompson: Sean, for a few days now, people have been talking 292 00:15:47,610 --> 00:15:50,880 Michael Thompson: about the most livable cities, the rankings that were released 293 00:15:50,880 --> 00:15:53,759 Michael Thompson: with Vienna at number one. And you are big on 294 00:15:53,760 --> 00:15:57,780 Michael Thompson: pronunciations. Do you say Copenhagen or Copenhagen? I say Copenhagen. 295 00:15:58,200 --> 00:16:00,420 Sean Aylmer: I would've said Hagen, but I'm happy to go with Hagen. 296 00:16:00,540 --> 00:16:05,219 Michael Thompson: Oh, deep divisions existing within Fear and Greed. Copenhagen, that 297 00:16:05,219 --> 00:16:07,530 Michael Thompson: came in at number two, and then you had Sydney 298 00:16:07,530 --> 00:16:10,830 Michael Thompson: and Melbourne at three and four. But what about the 299 00:16:10,830 --> 00:16:12,750 Michael Thompson: other end? What about the least livable cities? 300 00:16:13,230 --> 00:16:18,600 Sean Aylmer: Oh, excellent question. So the Economist Intelligence Units Global Livability 301 00:16:18,600 --> 00:16:20,820 Sean Aylmer: Index 2023 came out late last week. 302 00:16:21,090 --> 00:16:22,440 Michael Thompson: That's a ridiculous name, isn't it? 303 00:16:22,440 --> 00:16:23,610 Sean Aylmer: It just goes off the tongue. 304 00:16:23,730 --> 00:16:25,650 Michael Thompson: Come on, guys, tighten it up a little bit. Come 305 00:16:25,650 --> 00:16:28,260 Michael Thompson: on. Good places to live. There you go. 306 00:16:29,760 --> 00:16:31,560 Sean Aylmer: So it came out late last week and post- COVID 307 00:16:31,560 --> 00:16:33,630 Sean Aylmer: Sydney and Melbourne have jumped up the list. Done very 308 00:16:33,630 --> 00:16:37,560 Sean Aylmer: well. Vancouver was number five, then Zurich, Calgary, and Canada, 309 00:16:37,950 --> 00:16:40,769 Sean Aylmer: Geneva, Toronto, Osaka, and Auckland came in at number 10. 310 00:16:41,219 --> 00:16:46,199 Sean Aylmer: The rankings consider stability, healthcare, culture and environment, education and 311 00:16:46,199 --> 00:16:49,050 Sean Aylmer: infrastructure. Now some of the big losers, I reckon this 312 00:16:49,050 --> 00:16:51,600 Sean Aylmer: is where it gets more interesting. So the British cities 313 00:16:51,600 --> 00:16:55,680 Sean Aylmer: of Edinburgh, Manchester and London went backwards, so too Los 314 00:16:55,680 --> 00:16:58,409 Sean Aylmer: Angeles and San Diego. But let's have a look at 315 00:16:58,410 --> 00:17:04,230 Sean Aylmer: the very bottom end. Coming in last at 173 is... 316 00:17:04,740 --> 00:17:05,400 Sean Aylmer: Any thoughts? 317 00:17:07,109 --> 00:17:09,090 Michael Thompson: Somewhere where there's conflict? 318 00:17:09,720 --> 00:17:11,700 Sean Aylmer: So Damascus, capital of Syria. 319 00:17:12,420 --> 00:17:13,500 Michael Thompson: Oh, that would make sense. 320 00:17:14,220 --> 00:17:20,369 Sean Aylmer: Tripoli was 172. Algiers in Algeria was 171. Port Moresby in 321 00:17:20,369 --> 00:17:22,379 Sean Aylmer: Papua New Guinea was 168. 322 00:17:23,699 --> 00:17:23,729 Michael Thompson: Oh. 323 00:17:23,730 --> 00:17:26,488 Sean Aylmer: Way down there. All these cities were actually worse than 324 00:17:26,490 --> 00:17:31,560 Sean Aylmer: Kyiv in the Ukraine, that came in at 164. So, yeah. 325 00:17:32,849 --> 00:17:35,370 Michael Thompson: So they're still worse than an active kind of war zone. 326 00:17:35,638 --> 00:17:38,669 Sean Aylmer: Yeah. So I mean it worries me, Port Moresby, that's 327 00:17:38,670 --> 00:17:39,000 Sean Aylmer: I mean- 328 00:17:39,030 --> 00:17:40,440 Michael Thompson: That's pretty confronting because that's- 329 00:17:40,440 --> 00:17:41,549 Sean Aylmer: That's our neighbor. 330 00:17:41,670 --> 00:17:41,940 Michael Thompson: Yeah. 331 00:17:42,388 --> 00:17:46,230 Sean Aylmer: Anyway, that's the livability index or the lack of livability 332 00:17:46,320 --> 00:17:47,070 Sean Aylmer: or something like that. 333 00:17:47,250 --> 00:17:50,250 Michael Thompson: Yes, indeed. All right. Interesting story. Now, Sean, up next 334 00:17:50,250 --> 00:17:52,410 Michael Thompson: is the Fear and Greed daily interview. You are speaking 335 00:17:52,410 --> 00:17:53,910 Michael Thompson: with Elise Kennedy from Jarden. 336 00:17:54,330 --> 00:17:56,909 Sean Aylmer: All about tech stocks, in particular, tech stocks on the 337 00:17:56,910 --> 00:18:00,239 Sean Aylmer: ASX, what she likes, what she doesn't. Well, worth a 338 00:18:00,270 --> 00:18:02,580 Sean Aylmer: listen if you're an investor. I mean more generally, it's 339 00:18:02,580 --> 00:18:04,860 Sean Aylmer: well worth a listen, but especially if you're an investor. 340 00:18:05,070 --> 00:18:06,629 Michael Thompson: Yeah. It is a really good chat. It's coming up 341 00:18:06,630 --> 00:18:09,059 Michael Thompson: next in the Fear Greed playlist on your podcast platform 342 00:18:09,059 --> 00:18:12,540 Michael Thompson: or at fearandgreed.com.au. And Sean, considering our lead story today 343 00:18:12,540 --> 00:18:15,178 Michael Thompson: was all about what economists think is going to happen 344 00:18:15,509 --> 00:18:17,879 Michael Thompson: to the Australian economy, it's also worth listening to Fear 345 00:18:17,879 --> 00:18:19,948 Michael Thompson: and Greed the week ahead with Stephen Koukoulas. 346 00:18:20,130 --> 00:18:23,700 Sean Aylmer: Sure is very big week this week. Nothing more important 347 00:18:23,700 --> 00:18:27,960 Sean Aylmer: than the monthly inflation numbers out this week. If they 348 00:18:27,990 --> 00:18:31,770 Sean Aylmer: fall sharply, that will probably influence the Reserve Bank according 349 00:18:31,770 --> 00:18:34,799 Sean Aylmer: to Stephen. He gives us his view on all that 350 00:18:34,799 --> 00:18:37,080 Sean Aylmer: sort of thing in that show, well worth a listen. 351 00:18:37,650 --> 00:18:39,208 Michael Thompson: Yeah. It's a great one. Thank you very much, Sean. 352 00:18:39,450 --> 00:18:40,080 Sean Aylmer: Thank you, Michael. 353 00:18:40,290 --> 00:18:44,190 Michael Thompson: It's Monday, the 26th of June 2023. Make sure you're 354 00:18:44,190 --> 00:18:48,599 Michael Thompson: following the podcast. Join us online on Instagram and LinkedIn and Twitter 355 00:18:48,599 --> 00:18:50,579 Michael Thompson: and Facebook. I'm so close to the end. I'm going 356 00:18:50,580 --> 00:18:52,589 Michael Thompson: to make it. Make sure you stay up to date 357 00:18:52,590 --> 00:18:54,840 Michael Thompson: on all the business news with Alexa and your Amazon 358 00:18:54,840 --> 00:18:58,050 Michael Thompson: Echo Smart speaker. Simply say, Alexa, play the Fear and 359 00:18:58,050 --> 00:19:01,680 Michael Thompson: Greed podcast at catch latest episode. Grab yours now@ amazon. com. 360 00:19:02,280 --> 00:19:04,710 Michael Thompson: au. I'm Michael Thompson and that was Fear and Greed. 361 00:19:04,980 --> 00:19:05,699 Michael Thompson: Have a great day.