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Michael Thompson: Today on Fear and Greed. Star Entertainment has reportedly been

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Michael Thompson: thrown a short term rescue package by one of its

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Michael Thompson: major shareholders, staving off administration for now. Cyclone Alfred continues

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Michael Thompson: its move towards southern Queensland and northern New South Wales,

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Michael Thompson: with landfall now expected early tomorrow morning and good news

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Michael Thompson: for local builders, plus milk prices set to rise, and

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Michael Thompson: how Elon Musk's political ambitions are harming Tesla sales. Welcome

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Michael Thompson: to Fear and Greed. Daily business news for people who

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Michael Thompson: make their own decisions. It is Friday, the seventh of

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Michael Thompson: March twenty twenty five. I'm Michael Thompson and good morning

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Michael Thompson: Sean Aylmer.

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Sean Aylmer: Good morning, Michael.

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Michael Thompson: Sean, the main story this morning, Star Entertainment appears to

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Michael Thompson: have found a saviour, with the gaming company set to

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Michael Thompson: offload its newly opened Brisbane casino and entertainment complex as

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Michael Thompson: part of its deal with its Hong Kong based shareholders.

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Sean Aylmer: The Financial Review is reporting that Chow Tai Fook Enterprises

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Sean Aylmer: and Far East Consortium are close to agreeing to an

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Sean Aylmer: injection of up to fifty million dollars as part of

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Sean Aylmer: a plan to save Star from administration. The two companies,

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Sean Aylmer: which are investors in Brisbane's Queen's Wharf precinct and major

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Sean Aylmer: shareholders in Star, will take control of the Queensland casino

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Sean Aylmer: under the plans. In terms of what we know officially,

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Sean Aylmer: Star has said it's days away from running out of

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Sean Aylmer: cash and it desperately needs short term funding. Well I

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Sean Aylmer: said desperately, they didn't say desperate. Star has debt of

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Sean Aylmer: around four hundred million dollars and its shares have not

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Sean Aylmer: traded since Monday because the group has not been able

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Sean Aylmer: to sign off on financial accounts. It should shortly be

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Sean Aylmer: able to access sixty million dollars from the sale of

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Sean Aylmer: its Sydney Events center that's in escrow at the moment.

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Sean Aylmer: That should come out of that in coming days. The

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Sean Aylmer: money the fifty million dollars from the Hong Kong investors

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Sean Aylmer: is a short term loan and CEO of Star, Steve McCann,

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Sean Aylmer: is still trying to secure long term funding.

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Michael Thompson: Now, Steve McCann didn't actually join that long ago and

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Michael Thompson: he has had a heck of a job to do

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Michael Thompson: to try and kind of pull staff through this. Just

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Michael Thompson: remind us of why Star is in so much trouble.

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Sean Aylmer: Three main factors. Huge cost blowouts at the Queen's Wharf facility. Two,

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Sean Aylmer: a potentially hefty fine for breaches of anti money laundering

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Sean Aylmer: and counter terrorism laws. We're waiting to see what they

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Sean Aylmer: will be. And, three, the broader financial market and the impact of strict

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Sean Aylmer: regulatory measures that have basically driven high rollers out of

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Sean Aylmer: the market. And that's really hurt Star because that's actually

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Sean Aylmer: where they made most of their money.

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Michael Thompson: Right now, Star isn't the only company that's doing it tough.

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Michael Thompson: It does seem like there is a bunch of companies

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Michael Thompson: struggling at the moment. We've talked about this, haven't we.

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Sean Aylmer: It's been incredible week. We've had Whyalla Steelworks coming out

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Sean Aylmer: saying it owes $1.35 billion dollars. We've had Australia's second

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Sean Aylmer: largest hospital group Healthscope, saying that well, it has failed

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Sean Aylmer: to pay rent on some of the buildings that house hospitals.

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Sean Aylmer: That's on top of the other stuff that we've known,

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Sean Aylmer: Regional Express, Rex, Moaic Brands. There's a bunch of companies

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Sean Aylmer: out there that are hurting right now, Michael.

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Michael Thompson: All Right now, moving away from this one, Sean, cyclone,

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Michael Thompson: Alfred has slowed considerably as it moves towards the Queensland coast,

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Michael Thompson: with the latest Bureau of Meteorology modeling suggesting it could

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Michael Thompson: make landfall early tomorrow morning, which is twenty four hours

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Michael Thompson: later than first expected.

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Sean Aylmer: At this stage, Alfred's center is most likely expected to

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Sean Aylmer: cross between Noosa Heads on the Sunshine Coast and Coolangatta

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Sean Aylmer: on the Gold Coast. The category two system is expected

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Sean Aylmer: to remain of similar intensity until its center starts to

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Sean Aylmer: interact with the coast. The Bureau said it's then likely

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Sean Aylmer: to go to a Category one storm. In northern New

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Sean Aylmer: South Wales and southern Queensland, flood evacuation warnings are current. Schools,

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Sean Aylmer: public transport, major roads and the airports are closed, although

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Sean Aylmer: emergency departments at hospitals remain open. Supermarkets have started closing.

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Sean Aylmer: We just wish for the best for everyone up there

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Sean Aylmer: involved in that crisis.

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Michael Thompson: Yeah, indeed, and even a Category one. I remember once

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Michael Thompson: we were in Fiji on holidays and on a tiny

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Michael Thompson: little island and a Category one cyclone came through. And

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Michael Thompson: when that hit they may say it's Category one on paper,

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Michael Thompson: but it feels like category five. It is extraordinary. The

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Michael Thompson: wind and the rain and just the intensity of that

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Michael Thompson: weather is quite extraordinary, So just thinking of everyone who

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Michael Thompson: is in those areas that are set to be affected

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Michael Thompson: over the next couple of days.

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Sean Aylmer: Absolutely.

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Michael Thompson: Now, Sean, after the show, you have an interview coming

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Michael Thompson: up today with Katrina Konstas from AfterPay.

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Sean Aylmer: Yeah, it's a great chat. She's head of the Australian operations.

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Sean Aylmer: She reports to Nick Molner, who reports to Jack Dorsey,

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Sean Aylmer: so she's at the very upper levels of that organisation.

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Sean Aylmer: We talked to her about how things have changed since

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Sean Aylmer: AfterPay was bought by Block. Block being the US based

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Sean Aylmer: organization of Jack Dorsey. How Buy Now Pay Later has evolved in Australia,

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Sean Aylmer: and then we talk about International Women's Day, of which

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Sean Aylmer: she's a very big part of, and why it matters.

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Sean Aylmer: It's a fantastic chat with Katrina.

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Michael Thompson: Yeah, it's a good one. It's coming up after the show.

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Michael Thompson: Stick Around. We're talking milk prices, we're talking why Elon

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Michael Thompson: Musk's relationship with Donald Trump could be harming Tesla sales,

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Michael Thompson: and plenty more. Sean, we'll be back in a moment

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Michael Thompson: with the rest of the day's business news.

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Michael Thompson: Sean, the total number of building approvals in January jumped

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Michael Thompson: more than six percent, adding to hopes that the beleagured

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Michael Thompson: sector is finally finally gaining some momentum.

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Sean Aylmer: I can't wait to talk to Stephen Koukoulas about this

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Sean Aylmer: on Monday because he's a bit of a fan of

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Sean Aylmer: the building sector and it has been in the dolldrums

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Sean Aylmer: for a long, long time. But those figures for January

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Sean Aylmer: the best monthly growth in half a year. In fact,

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Sean Aylmer: December's figures were revised up, January was up significantly. Total

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Sean Aylmer: approvals are now running at about a one hundred and

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Sean Aylmer: ninety thousand pace. They're up fourteen percent on a year ago,

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Sean Aylmer: more than twenty percent above the lows in the cycle.

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Sean Aylmer: It just looks like something's happening in the building sector. Finally!

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Sean Aylmer: What building approvals do points to more homes being built

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Sean Aylmer: in coming quarters. That's the good news. Also, migration flows slowing.

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Sean Aylmer: That should be some of the pressure on the housing markets.

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Sean Aylmer: They are on the supply side, more supply. Demand, reduced

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Sean Aylmer: demand takes some pressure off. It's still well below the

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Sean Aylmer: government's hope for run rate of two hundred and forty

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Sean Aylmer: thousand a year. There's still an under supply of homes,

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Sean Aylmer: which will keep a floor on house prices. They don't

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Sean Aylmer: expect house prices to fall much anytime soon. But builders, chippies, electricians, carpenters,

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Sean Aylmer: they're starting to find work again, or they should be

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Sean Aylmer: able to start finding work again, and that's really promising.

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Michael Thompson: Indeed. Now bad news, Sean, from the dairy sector, unless,

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Michael Thompson: of course, you happen to be a dairy farmer, in which

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Michael Thompson: case it is a different story altogether. But prices are

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Michael Thompson: forecast to remain high this year, potentially pushing up consumer prices.

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Michael Thompson: So we're going to be paying more for milk.

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Sean Aylmer: Yes, so demand is expected to grow and production will

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Sean Aylmer: struggle to keep up. According to a report from agribusiness experts Rabobank,

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Sean Aylmer: milk production in the big seven dairy export regions, the EU,

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Sean Aylmer: the US, New Zealand, Brazil, Argentina and Australia is expected

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Sean Aylmer: to expand by nearly one percent for twenty twenty five,

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Sean Aylmer: similar gain early next year. Now, for Australia, the report said,

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Sean Aylmer: dairy farm margins are set to benefit from improving farm

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Sean Aylmer: gate prices through twenty twenty five, high commodity returns and

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Sean Aylmer: a softer currency. What's interesting about milk is it's not

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Sean Aylmer: really a global market because it doesn't travel very well,

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Sean Aylmer: but because it can be used for powdered milk and

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Sean Aylmer: things like that. It's kind of a semi global market,

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Sean Aylmer: so whatever happens on the global market prices does actually

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Sean Aylmer: affect us here. Also playing out in Australia, we had

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Sean Aylmer: such cheap milk prices, remember the two bucks for two litres,

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Sean Aylmer: three dollars for three litres that Woolies and Coles were offering. We

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Sean Aylmer: don't have that anymore, and there's catch up going on

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Sean Aylmer: as dairy farmers ensure they're sustainable. The bottom line and

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Sean Aylmer: all this is that prices are rising and we consumers

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Sean Aylmer: will probably pay for that at the grocery store now.

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Michael Thompson: Sean, the Prudential Regulator is overhauling rules applying to the

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Michael Thompson: boards of financial services companies, forcing directors to step down

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Michael Thompson: after ten years.

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Sean Aylmer: The Australian Prudential Regulation Authority looks after banks, insurers and

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Sean Aylmer: superannuation funds. Basically wants a much greater say in succession planning.

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Sean Aylmer: So six years after the Hain Royal Commission into Banking,

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Sean Aylmer: the APRA chair John Lonsdale said he sees areas of

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Sean Aylmer: weakness in the sector and the quote goes along the

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Sean Aylmer: lines of entities treating compliance with some requirements as a

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Sean Aylmer: box ticking exercise. Not something that you want to regulators

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Sean Aylmer: to think. The new rules would introduce a ten year

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Sean Aylmer: limit on directorships, meaning, for example, National Australia Bank chair

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Sean Aylmer: Phil Chronican would have to step down next year. APRA

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Sean Aylmer: also wants to be informed on succession planning. Now there's

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Sean Aylmer: been a lot of controversy around Cbus, the Superannuation Fund

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Sean Aylmer: and who has been running that business. And this in

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Sean Aylmer: a sense, not that the Cbus was mentioned specifically, but

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Sean Aylmer: this in a sense sounds as if APRA is trying

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Sean Aylmer: to address those sorts of issues.

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Michael Thompson: Okay, all right, how does ten years sound to you?

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Michael Thompson: Is that too long? Not long enough? Like something to

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Michael Thompson: be said for having kind of someone with long tenure

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Michael Thompson: in terms of experience on that board.

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Sean Aylmer: Yes, that's true. What you find. So I think Phil

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Sean Aylmer: Chronicle might be an example of this. You can have

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Sean Aylmer: a director for eight or nine years and then they

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Sean Aylmer: become chair and they're only chair for one year. That's

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Sean Aylmer: not so good. Like you do want your chair to

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Sean Aylmer: have good longevity in that role. So that's a bit tricky. Yeah,

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Sean Aylmer: you can't say I'm an expert on bank boards though, Michael.

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Michael Thompson: That's all right, that's fine. There's a question without notice. Sure, no,

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Michael Thompson: that's fair enough now. Amcor's share price fell one and

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Michael Thompson: a half percent yesterday after it unveiled plans to reorganize

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Michael Thompson: its business following it's thirteen billion dollar purchase of US

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Michael Thompson: based Berry Global.

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Sean Aylmer: Great name, Berry Global.

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Michael Thompson: It is good, isn't it?

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Sean Aylmer: Both Berrry Global. In fact, I'm going to call it Berry Global now

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Sean Aylmer: not Berry. Berry Global and Amcor got shareholders support for the deal earlier in

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Sean Aylmer: the week. The new business will have two parts, Global

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Sean Aylmer: Flexibles and Global Closures and Containers. Now, again, I don't

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Sean Aylmer: know a lot about Amcor, but I like the idea

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Sean Aylmer: of the flexibles versus closures and containers. So flexible is

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Sean Aylmer: presumably you know ziploc bags, do you think? And your

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Sean Aylmer: global closures and containers are more your Tupperware?

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Michael Thompson: Oh yeah, probably right.

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Sean Aylmer: Yeah, but who said packaging wasn't exciting Michael?

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Michael Thompson: Can you imagine the competition between those divisions?

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Sean Aylmer: Yes, and in fact, Amcor actually (made) quite an interesting statement yesterday.

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Sean Aylmer: It came out and said we're on the hunt for

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Sean Aylmer: new leaders of those two divisions. So I'm sure they

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Sean Aylmer: wanted to be competitive people the flexibles versus containers. They

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Sean Aylmer: also want a new CFO. Big business now, after this merger,

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Sean Aylmer: four hundred packaging plants around the world, seventy five thousand staff.

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Sean Aylmer: That's a lot of people doing packaging.

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Michael Thompson: That's a lot of plants. Thats a lot of kind of

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Michael Thompson: factories and warehouses. That's huge. Sean, gold companies are having

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Michael Thompson: a good time of it at the moment. And yesterday

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Michael Thompson: West African Resources share price jumped twelve percent after it

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Michael Thompson: said it was targeting much higher gold production over the

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Michael Thompson: next year.

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Sean Aylmer: So West African Resources is constructing a gold mine in Kiaka,

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Sean Aylmer: in Burkina Faso. Now it already has a gold processing

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Sean Aylmer: plant there which processes gold from a mine, but it's

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Sean Aylmer: West African is about to start production at a mine

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Sean Aylmer: in Kiaka, and it's forecasting production of four million ouncers

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Sean Aylmer: over the next ten years, or from twenty twenty four

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Sean Aylmer: to twenty thirty three. Of course, Michael, when you start

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Sean Aylmer: talking West African Resources Kiaka, Burkina Faso, you start going

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Sean Aylmer: down a rabbit hole because I can't just say the

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Sean Aylmer: words without quite knowing what it is. So Burkina Faso used

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Sean Aylmer: to be called Upper Volta. Now I knew a bit

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Sean Aylmer: about Upper Volta years ago, but I didn't realize it'd become Burkina Faso.

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Sean Aylmer: So there you go. It's a landlocked country south of

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Sean Aylmer: the Sahara and West African Resources, the aptly named West

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Sean Aylmer: African Resources has been there for quite a while. It's

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Sean Aylmer: got a couple of minds there. It's actually done really well.

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Sean Aylmer: It's share price has been rising on a high gold

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Sean Aylmer: prices twenty percent in the last week. In fact, doubled

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Sean Aylmer: in the last year. But it is a great example

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Sean Aylmer: of an Australian listed company headquartered in Subiaco in Western

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Sean Aylmer: Australia eating the way in an underdeveloped economy. Now, of

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Sean Aylmer: course we know that comes with challenges as well, but

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Sean Aylmer: I just think it's a cool story.

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Michael Thompson: Yeah, Burkina Faso capital city? Ouagadougou.

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Sean Aylmer: Yeah? I saw it. I couldn't pronounce it.

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Michael Thompson: And that was one that I learned in high school

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Michael Thompson: because it was the one that no one could ever remember.

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Michael Thompson: And so suddenly it sets you...

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Sean Aylmer: What is it? It's O U ga d o U

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Sean Aylmer: g O?

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Michael Thompson: Yeah. Ouagadougou. And it's sets you apart from everyone else in

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Michael Thompson: a trivia competition, like all of a sudden, whenever that

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Michael Thompson: kind of thing comes up, it's like a jackpot round

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Michael Thompson: kind of question.

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Sean Aylmer: Yeah yeah, yeah, yeah, yeah.

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Michael Thompson: There you go.

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Sean Aylmer: Interesting.

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Michael Thompson: After all the facts that you shared, I contributed one

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Michael Thompson: little nugget, but my nugget could win you five hundred

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Michael Thompson: dollars at pub trivia.

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Sean Aylmer: That's right.

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Michael Thompson: Okay, So we mentioned a couple of companies there. What

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Michael Thompson: else is going on in financial markets?

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Sean Aylmer: The local share market closed down a little over half percent.

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Sean Aylmer: There was a run of ex-dividend dates weighing on the bourse.

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Sean Aylmer: Oil prices have fallen to a three year low on

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Sean Aylmer: the back of the tariff war going on. That sent stocks like Woodside,

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Sean Aylmer: Santos and Ampol lower. Mesoblast is now back part of

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Sean Aylmer: the S&P/ASX200. That's the regenerative medicines developer. It's replaced Arcadian lithium,

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Sean Aylmer: which has been bought by Rio Tinto away from equities.

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Sean Aylmer: The hardline the Trump administration is taking on tariffs has

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Sean Aylmer: hit the green back, pushing the Aussie dollar back to

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Sean Aylmer: around sixty three and a half US cents.

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Michael Thompson: Speaking of the Trump administration, turning to international news, the

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Michael Thompson: rhetoric between China and the US is escalating, with US

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Michael Thompson: Defense Secretary Pete Hegseth hitting back at Beijing's Well, you'd

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Michael Thompson: really call it saber rattling, wouldn't you, Because there is

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Michael Thompson: a widening trade war between the superpowers, and neither of

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Michael Thompson: them are holding back in what they're saying.

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Sean Aylmer: No, so, mister Hegseth said the US was prepared to

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Sean Aylmer: engage in conventional battle with China, saying those who long

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Sean Aylmer: for peace must prepare for war. The comments follow posts

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Sean Aylmer: from China's Foreign Ministry saying the country was ready for

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Sean Aylmer: war with America as it raises defense spending and imposes

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Sean Aylmer: retaliatory tariffs on US imports. The quote from the Chinese

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Sean Aylmer: Foreign Ministry, if war is what the US wants, be

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Sean Aylmer: it a tariff war, a trade war, or any other

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Sean Aylmer: type of war, we are ready to fight until the end.

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Sean Aylmer: The US hit China this week with twenty percent tariffs

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Sean Aylmer: in response to what the White House says is a

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Sean Aylmer: lack of action over fentanyl movement. Beijing responded by boosting

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Sean Aylmer: defense spending and hitting the US with tariffs of up

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Sean Aylmer: to fifteen percent on some agricultural goods.

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Michael Thompson: Elon Musk's relationship with Donald Trump is hurting sales of

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Michael Thompson: Tesla's electric vehicles worldwide, from Europe right through to Australia.

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Sean Aylmer: So we found out this week that Tesla sales were

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Sean Aylmer: down more than seventy percent in Australia. Now figures from

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Sean Aylmer: Germany show sales around seventy six percent last month. That's

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Sean Aylmer: two months in a row of lower sales. Musk recently

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Sean Aylmer: aggressively promoted a far right wing party in Germany ahead

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Sean Aylmer: of the election. But they're down across Europe, so France

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Sean Aylmer: down about twenty six percent. There's also a spate of

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Sean Aylmer: Tesla vehicles and parking lots being set on fire as

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Sean Aylmer: demonstration about Elon Musk and his relationship with Donald Trump.

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Sean Aylmer: In Norway, Tesla sales nearly halved last month. That's a

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Sean Aylmer: country which is close to ending internal combustion engine car

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Sean Aylmer: sales at all. So that you know, of all the

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Sean Aylmer: major nations that is far down the track in terms

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Sean Aylmer: of EVS. Yet Tesla sales nearly halved, down about forty percent,

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Sean Aylmer: and Denmark forty two percent. In Sweden, the exception is

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Sean Aylmer: a UK, where sales are up twenty percent last month.

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Sean Aylmer: Though Tesla is actually losing EV market share, it's share price.

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Sean Aylmer: Tesla's share price is down thirty five percent since the

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Sean Aylmer: middle of January, just the head of the inauguration.

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Michael Thompson: And is BYD the big competitor in most cases, or

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Michael Thompson: is it the fact that so many other of the

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Michael Thompson: conventional car brands are bringing out hybrids as well that

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Michael Thompson: are competing more.

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Sean Aylmer: Yeah, the latter in Europe, in Australia, it's BYD. In

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Sean Aylmer: Europe though a lot of the carmakers there are bringing

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Sean Aylmer: out evs and hybrids.

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Michael Thompson: All right, Okay, plenty in this one today, Sean Up

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Michael Thompson: next is the Fear and Greed Daily Interview with Katrina

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Michael Thompson: Konstas from AfterPay. It's a great chat. It is coming

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Michael Thompson: up in the Fear and Greed playlist on your podcast

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Michael Thompson: platform or at Fearangreed dot com dot au. Thank you very much.

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Sean Aylmer: Thank you, Michael.

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Michael Thompson: It is Friday, the seventh of March twenty twenty five.

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Michael Thompson: Make sure you're following the podcast and please join us

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Michael Thompson: online on LinkedIn, Instagram, x TikTok and Facebook. Michael Thompson.

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Michael Thompson: That was Fear and Greed. Have a great day.