1 00:00:05,880 --> 00:00:07,600 Speaker 1: Stephen Cooculis Koogie. 2 00:00:07,600 --> 00:00:10,440 Speaker 2: Welcome mate, Mark Burris Cada. Great to be here and 3 00:00:10,520 --> 00:00:13,120 Speaker 2: what a time to be discussing the economy. 4 00:00:13,360 --> 00:00:16,640 Speaker 3: You vet you mate, So look, let's talk about the 5 00:00:16,640 --> 00:00:20,480 Speaker 3: elephant the room. So the last couple of days, the 6 00:00:20,520 --> 00:00:26,599 Speaker 3: current federal government, which is the Albanese government, whilst they're 7 00:00:26,640 --> 00:00:31,920 Speaker 3: in having a few dramas at the moment, but nonetheless 8 00:00:32,400 --> 00:00:37,839 Speaker 3: they commissioned an inquiry into the handling of the COVID period, 9 00:00:38,920 --> 00:00:42,480 Speaker 3: which of course was a period when the Liberal Party, 10 00:00:43,120 --> 00:00:46,199 Speaker 3: the Liberals and the Nationals were in government. So we 11 00:00:46,280 --> 00:00:53,200 Speaker 3: talk management twenty twenty two and one of the findings 12 00:00:53,240 --> 00:00:59,080 Speaker 3: of that inquiry was that the federal government's stimulants or 13 00:00:59,160 --> 00:01:02,320 Speaker 3: stimulation of the economy and leaving aside the RBA what 14 00:01:02,400 --> 00:01:07,000 Speaker 3: they did too, but was a large cause of inflation 15 00:01:07,120 --> 00:01:11,400 Speaker 3: in Australia today, which by the way, right now morgsholders 16 00:01:11,440 --> 00:01:13,720 Speaker 3: are paying for because you know, we had to bring 17 00:01:13,720 --> 00:01:18,600 Speaker 3: in a higher industrate to control inflation. And of course 18 00:01:18,920 --> 00:01:22,720 Speaker 3: doctor Jim Chalmers has made that point very clear because 19 00:01:22,760 --> 00:01:24,039 Speaker 3: he is the current Treasurer. 20 00:01:24,720 --> 00:01:25,600 Speaker 1: What do you think about that? 21 00:01:26,000 --> 00:01:30,840 Speaker 2: Yeah, couple a couple of things at the time, and 22 00:01:30,840 --> 00:01:35,640 Speaker 2: people sort of seemed to forget how bad conditions were, 23 00:01:35,680 --> 00:01:38,039 Speaker 2: not just socially. We're all sitting at home and fearing 24 00:01:38,080 --> 00:01:39,240 Speaker 2: we're getting COVID, all that sort of. 25 00:01:39,480 --> 00:01:40,720 Speaker 1: Give me a bit of it won't happen to me. 26 00:01:41,160 --> 00:01:43,000 Speaker 1: So let's say March. 27 00:01:42,840 --> 00:01:45,720 Speaker 2: March twenty twenty yep. And then beyond a few months 28 00:01:45,800 --> 00:01:48,560 Speaker 2: after that, we were fearing that this would be a 29 00:01:48,600 --> 00:01:51,840 Speaker 2: pandemic that would kill lots of people were getting information 30 00:01:51,880 --> 00:01:54,960 Speaker 2: out of Europe, Italy, there were people dying, the US, 31 00:01:55,160 --> 00:01:57,720 Speaker 2: other places. There were sort of huge numbers of people 32 00:01:57,800 --> 00:02:01,640 Speaker 2: dying catching this disease. It was horrible and apart from 33 00:02:01,680 --> 00:02:04,280 Speaker 2: the social and health effects which are obvious to all 34 00:02:04,280 --> 00:02:08,760 Speaker 2: of US, governments around the world, including our government here 35 00:02:08,760 --> 00:02:11,280 Speaker 2: in Australia, were worried about what would cause the economy. 36 00:02:11,280 --> 00:02:13,040 Speaker 2: If we were all seeing at home doing nothing, we 37 00:02:13,160 --> 00:02:15,960 Speaker 2: lost our jobs, we were getting paid, our businesses were 38 00:02:15,960 --> 00:02:19,760 Speaker 2: shutting down. It would be a catastrophe, of course, and 39 00:02:19,800 --> 00:02:22,320 Speaker 2: there were a lot of initial forecasts, including from the RBA, 40 00:02:22,400 --> 00:02:25,320 Speaker 2: including from Treasury at the time, that a sort of 41 00:02:25,440 --> 00:02:30,040 Speaker 2: do nothing approach would see unemployment hit fifteen percent at least, 42 00:02:30,639 --> 00:02:34,400 Speaker 2: have a depression, not a recession, a depression rivaling the 43 00:02:34,440 --> 00:02:41,000 Speaker 2: early nineteen thirties depression. So what was done and appropriate 44 00:02:41,040 --> 00:02:43,799 Speaker 2: in my view was, and this is around the world, 45 00:02:43,880 --> 00:02:46,480 Speaker 2: including here in Australia, that the Morrison government with Josh 46 00:02:46,600 --> 00:02:51,840 Speaker 2: Rodenberger's Treasurer, spent a lot of money. Job keeper and 47 00:02:51,919 --> 00:02:54,360 Speaker 2: job seeker were the two big ones. There was a 48 00:02:54,440 --> 00:02:58,320 Speaker 2: construction fund, there a whole lot of other measures to 49 00:02:58,680 --> 00:03:03,639 Speaker 2: ease lending restrictions and people going in solvent those sort 50 00:03:03,639 --> 00:03:05,440 Speaker 2: of things. There were conditions that were put on those things. 51 00:03:05,480 --> 00:03:07,600 Speaker 2: So there was everything thrown at the economy and in 52 00:03:07,600 --> 00:03:10,880 Speaker 2: my view that was correct because at the time we 53 00:03:10,880 --> 00:03:14,840 Speaker 2: were very scared, genuinely scared economically about what would happen. 54 00:03:14,960 --> 00:03:18,040 Speaker 2: And Australia wasn't the lone range. It happened everywhere. Now 55 00:03:18,760 --> 00:03:24,360 Speaker 2: that COVID inquiry which fuel inflation, The bottom line is 56 00:03:24,440 --> 00:03:28,440 Speaker 2: yes it did. That was the price we paid for 57 00:03:29,080 --> 00:03:33,200 Speaker 2: the Americans, the Europeans, us here in Australia, every country 58 00:03:33,240 --> 00:03:35,480 Speaker 2: under the sun pumping money into the economy. Yeah, we 59 00:03:35,480 --> 00:03:37,400 Speaker 2: had this discussion a couple of years ago when inflation 60 00:03:37,840 --> 00:03:40,360 Speaker 2: was going up. Why why Part of it was because 61 00:03:40,360 --> 00:03:42,360 Speaker 2: we had interstraights cceteria. So the Reserve boike played its 62 00:03:42,400 --> 00:03:47,520 Speaker 2: part two. But the fiscal policy, the budgetary policy measures, spending, 63 00:03:47,640 --> 00:03:51,480 Speaker 2: tax breaks, these sorts of things were huge. And so 64 00:03:51,520 --> 00:03:53,360 Speaker 2: when we look back about, well, why did inflation go 65 00:03:53,400 --> 00:03:55,560 Speaker 2: from two percent to eight percent, which it did by 66 00:03:55,560 --> 00:03:58,600 Speaker 2: the end of twenty twenty two, a lot of it 67 00:03:58,680 --> 00:04:01,600 Speaker 2: was due to that. Yes, so in a sense it's correct. 68 00:04:02,000 --> 00:04:05,280 Speaker 2: But would I have done anything different? Probably not, because 69 00:04:05,280 --> 00:04:07,360 Speaker 2: you throw the kitchen sink at it. And if you 70 00:04:07,440 --> 00:04:09,880 Speaker 2: spend too much, this is where the this is where 71 00:04:09,920 --> 00:04:14,120 Speaker 2: the debate becomes a little bit more sensitive. You pull 72 00:04:14,160 --> 00:04:16,000 Speaker 2: the money back out of the economy a little quicker 73 00:04:16,080 --> 00:04:20,560 Speaker 2: than perhaps they did the federal government without being labor 74 00:04:20,560 --> 00:04:21,400 Speaker 2: liberal or anything like that. 75 00:04:21,480 --> 00:04:22,320 Speaker 1: So don't extend it. 76 00:04:22,760 --> 00:04:25,240 Speaker 2: Don't extend it. And maybe, just maybe we should have 77 00:04:26,200 --> 00:04:30,320 Speaker 2: taken clawed back some of the job seek a job 78 00:04:30,400 --> 00:04:32,599 Speaker 2: keeper payments to companies that didn't really need it, because 79 00:04:32,640 --> 00:04:35,360 Speaker 2: some companies did did really well, because we all bought. 80 00:04:35,160 --> 00:04:38,599 Speaker 1: New TVs Connors, for example, got a lot of money. 81 00:04:38,680 --> 00:04:42,040 Speaker 2: Did I say they got billions at two billion? 82 00:04:42,320 --> 00:04:45,240 Speaker 3: As a fact, And I think, because someone asked me 83 00:04:45,320 --> 00:04:50,760 Speaker 3: this question this morning, do I think that the some 84 00:04:50,800 --> 00:04:56,800 Speaker 3: of these companies profited immensely from the job keeper payments. 85 00:04:57,640 --> 00:05:01,800 Speaker 3: The answer is yes. And but then why therefore did 86 00:05:01,839 --> 00:05:04,760 Speaker 3: this happen? Well, if I recall that it had to 87 00:05:04,760 --> 00:05:07,040 Speaker 3: happen in a hurry, and you know, it had to 88 00:05:07,080 --> 00:05:09,279 Speaker 3: be done through the ATO, it was done through the ATO, 89 00:05:09,320 --> 00:05:11,920 Speaker 3: if you recall, and the administration of something like this, 90 00:05:12,040 --> 00:05:14,720 Speaker 3: Whilst they could have sat down and sort of you know, 91 00:05:14,800 --> 00:05:17,320 Speaker 3: tightened it up really tight, it would have taken them 92 00:05:17,520 --> 00:05:19,920 Speaker 3: so much time that we would have lost the benefit 93 00:05:19,960 --> 00:05:21,760 Speaker 3: of actually releasing the money immediately because we had to 94 00:05:21,800 --> 00:05:24,160 Speaker 3: release the money immediately. So the game was let's just 95 00:05:24,200 --> 00:05:26,280 Speaker 3: get it out there and deal with the problem down 96 00:05:26,279 --> 00:05:26,600 Speaker 3: the track. 97 00:05:26,640 --> 00:05:29,400 Speaker 2: And by the way, mark, if I can say this, 98 00:05:30,000 --> 00:05:33,599 Speaker 2: it sort of worked. Yeah, because unemployment peaked at seven 99 00:05:33,680 --> 00:05:37,159 Speaker 2: and a half percent, not fifteen percent. Fantastic. That's a 100 00:05:37,160 --> 00:05:39,320 Speaker 2: couple of million jobs that were saved, a couple of 101 00:05:39,320 --> 00:05:44,919 Speaker 2: million people had an income that kept them afloat. 102 00:05:44,560 --> 00:05:47,159 Speaker 1: And businesses had small business kept. 103 00:05:46,960 --> 00:05:49,080 Speaker 2: The float during this period even though they weren't selling much, 104 00:05:49,120 --> 00:05:52,280 Speaker 2: if anything at all. So that was one thing. We 105 00:05:52,320 --> 00:05:54,520 Speaker 2: had one horrendous court of GDP. I think it was 106 00:05:54,600 --> 00:05:56,920 Speaker 2: minus seven percent in the Gyne quarter of twenty twenty 107 00:05:57,200 --> 00:05:58,880 Speaker 2: and then we had bits and pieces, and then we've 108 00:05:58,880 --> 00:06:03,520 Speaker 2: had the economic recovery since then. So it's one of 109 00:06:03,560 --> 00:06:06,840 Speaker 2: those things, an analogy I like to use. You've got, 110 00:06:07,760 --> 00:06:10,000 Speaker 2: you know, the art gallery burning down, You've got the 111 00:06:10,680 --> 00:06:12,640 Speaker 2: mono lease is about to burn it sort of just 112 00:06:12,640 --> 00:06:14,360 Speaker 2: in the room next door. What do you do, Oh, well, 113 00:06:14,360 --> 00:06:16,640 Speaker 2: we use more water or less water? Were now you 114 00:06:16,640 --> 00:06:18,640 Speaker 2: put out the bloody fire as quickly as you can 115 00:06:18,720 --> 00:06:21,039 Speaker 2: so you don't destroy everything, rather than say, oh, maybe 116 00:06:21,040 --> 00:06:25,320 Speaker 2: we could have used a little bit less water and 117 00:06:25,320 --> 00:06:26,880 Speaker 2: and sort of have a bit more water for the 118 00:06:26,920 --> 00:06:29,480 Speaker 2: next fire that comes along. No, you throw the kitchen 119 00:06:29,480 --> 00:06:33,479 Speaker 2: sink at it because it was a problem. The question again, 120 00:06:33,600 --> 00:06:35,760 Speaker 2: the question is what do you do when the COVID 121 00:06:35,880 --> 00:06:40,160 Speaker 2: pandemic ends and we have the lockdowns ending. Maybe you 122 00:06:40,279 --> 00:06:42,359 Speaker 2: withdraw And this is the interest rate question that doctor 123 00:06:42,400 --> 00:06:45,479 Speaker 2: Low had on the RBA. But also from a government perspective, 124 00:06:46,040 --> 00:06:50,240 Speaker 2: you get some of that stimulus, that cash out of 125 00:06:50,240 --> 00:06:53,600 Speaker 2: the economy to cool that inflation pressure. No government in 126 00:06:53,600 --> 00:06:56,440 Speaker 2: the world did it. So again Australia's we want the 127 00:06:56,480 --> 00:06:59,040 Speaker 2: lone rangers doing that. You look at the Americans now 128 00:06:59,080 --> 00:07:02,600 Speaker 2: look at their budget again, Europeans the problems they've got again, 129 00:07:02,839 --> 00:07:06,080 Speaker 2: the UK, they've all got horrendous budget positions. Our budget 130 00:07:06,120 --> 00:07:08,599 Speaker 2: actually a little bit better by the way, but you know, 131 00:07:08,640 --> 00:07:10,920 Speaker 2: you could have done a bit more. But that's harry hindsight. 132 00:07:11,160 --> 00:07:16,720 Speaker 3: And of course another argument in hindsight as to it 133 00:07:16,760 --> 00:07:19,040 Speaker 3: would have been better for our government not to have 134 00:07:19,080 --> 00:07:21,080 Speaker 3: spent as much money or thrown as much money at it, 135 00:07:21,160 --> 00:07:21,760 Speaker 3: or end or. 136 00:07:24,560 --> 00:07:25,800 Speaker 1: Stop throwing money. 137 00:07:25,640 --> 00:07:29,200 Speaker 3: At it at an earlier date is that our inflation 138 00:07:29,400 --> 00:07:32,400 Speaker 3: has endured for quite a while. But that's got nothing 139 00:07:32,400 --> 00:07:33,880 Speaker 3: to do with the fact that money was thrown at it. 140 00:07:33,880 --> 00:07:35,239 Speaker 3: That's got something to do with the way the reserve 141 00:07:35,280 --> 00:07:39,400 Speaker 3: banks decided to roll their interest rates out interest rate 142 00:07:39,520 --> 00:07:43,840 Speaker 3: increases out. Maybe another thing we could reflect on is 143 00:07:43,960 --> 00:07:46,600 Speaker 3: did the Reserve Bank go hard enough fast enough. 144 00:07:47,120 --> 00:07:50,200 Speaker 2: Yes, that's a different issue discussion, and we go back. 145 00:07:50,960 --> 00:07:53,000 Speaker 2: Tell me to bring up Phil Logan when he was governor. 146 00:07:53,040 --> 00:07:55,000 Speaker 2: But he did make a mistake. He acknowledges that now 147 00:07:55,040 --> 00:07:57,600 Speaker 2: that at the end of twenty twenty one, Yeah, when 148 00:07:57,600 --> 00:07:59,280 Speaker 2: he said, oh, we're going to keep interest rates zero 149 00:07:59,360 --> 00:08:02,920 Speaker 2: point one percent for three years, even though the inflation 150 00:08:03,040 --> 00:08:05,200 Speaker 2: was starting to pick up around the world, and other 151 00:08:05,560 --> 00:08:10,200 Speaker 2: central banks, the Kiwis, the Canadians, the Asericans were hiking interstates. 152 00:08:10,280 --> 00:08:13,360 Speaker 2: He said, oh no, no, we're different. Had he gone 153 00:08:13,520 --> 00:08:17,800 Speaker 2: earlier in hiking rates, and maybe a little bit more 154 00:08:17,800 --> 00:08:20,679 Speaker 2: aggressively in that early part of the rate hiking cycle 155 00:08:20,680 --> 00:08:23,120 Speaker 2: when rates started at zero point one, so it was 156 00:08:23,160 --> 00:08:25,720 Speaker 2: not coming from a very high base, indeed, that was 157 00:08:25,760 --> 00:08:28,360 Speaker 2: coming from an incredibly low base, maybe that would have 158 00:08:28,440 --> 00:08:30,440 Speaker 2: nipped a little bit of this inflation pressure. I don't 159 00:08:30,440 --> 00:08:32,439 Speaker 2: think would have beaten all the inflation pressures that came 160 00:08:32,440 --> 00:08:35,360 Speaker 2: through because some of them, also, we've got to remember, 161 00:08:35,400 --> 00:08:37,920 Speaker 2: were outside the control of government spending in interest rates, 162 00:08:37,920 --> 00:08:41,000 Speaker 2: so they were supply chain problems. Remember you couldn't buy 163 00:08:41,040 --> 00:08:42,480 Speaker 2: a car for a year because they weren't making them 164 00:08:42,520 --> 00:08:44,960 Speaker 2: because everyone who manufactured cars were sick with COVID in 165 00:08:45,760 --> 00:08:48,520 Speaker 2: career and throughout Europe, we couldn't buy them. There was 166 00:08:48,559 --> 00:08:50,800 Speaker 2: the supply chain problems. The shipping rates went up because 167 00:08:50,840 --> 00:08:53,320 Speaker 2: no one was able to man the ships that were 168 00:08:53,320 --> 00:08:55,800 Speaker 2: carrying these containers around the world. So some of these 169 00:08:55,800 --> 00:08:59,600 Speaker 2: things that caused inflation to pick up had very little 170 00:08:59,640 --> 00:09:03,560 Speaker 2: to do, nothing to do frankly with interest rates or 171 00:09:03,600 --> 00:09:06,760 Speaker 2: government spending. So that's one other thing that we've learned. 172 00:09:06,760 --> 00:09:10,920 Speaker 2: So you know, why did the price of a lot 173 00:09:10,960 --> 00:09:13,720 Speaker 2: of imported goods and cars go up? There weren't any available, 174 00:09:13,760 --> 00:09:15,520 Speaker 2: and people had a bit of cash. I want to 175 00:09:15,520 --> 00:09:16,880 Speaker 2: buy a new cart. There is month, so I'm going 176 00:09:16,920 --> 00:09:18,560 Speaker 2: to bid up the price car. So I put up 177 00:09:18,559 --> 00:09:20,440 Speaker 2: in prices and that came through, and that. 178 00:09:20,559 --> 00:09:21,959 Speaker 1: I had the cash a bit up too, because my 179 00:09:22,559 --> 00:09:24,040 Speaker 1: business been given job keeper. 180 00:09:23,920 --> 00:09:27,480 Speaker 2: Correct, And that's that. And so there are many there 181 00:09:27,480 --> 00:09:30,520 Speaker 2: are many drive Like most things in economics, it's really 182 00:09:30,720 --> 00:09:33,240 Speaker 2: one thing causes a good thing or a bad thing 183 00:09:33,240 --> 00:09:36,760 Speaker 2: to occur. There are many parents to this problem, and 184 00:09:37,040 --> 00:09:39,520 Speaker 2: some will supply chained. Some was interestrates, some of it 185 00:09:39,640 --> 00:09:43,839 Speaker 2: was government spending. But to blame one course and one 186 00:09:43,920 --> 00:09:47,600 Speaker 2: cause only is a bit too simplistic to be frank. 187 00:09:47,760 --> 00:09:50,160 Speaker 3: Yeah, right, And I think I think that because it 188 00:09:50,200 --> 00:09:52,960 Speaker 3: is important to get some context around that report. The 189 00:09:53,080 --> 00:09:55,000 Speaker 3: other thing that's come out in the last couple of 190 00:09:55,040 --> 00:09:58,680 Speaker 3: weeks was the and we've talked about this noise and 191 00:09:58,679 --> 00:10:00,680 Speaker 3: but we've got to talk about it again is the 192 00:10:00,840 --> 00:10:05,400 Speaker 3: unemployment number. The unemployment number for me disappointingly coming four 193 00:10:05,440 --> 00:10:10,199 Speaker 3: point one one again. Yeah, so we haven't four. It's 194 00:10:10,200 --> 00:10:12,320 Speaker 3: come four too, four one. That's sort of hanging. 195 00:10:12,640 --> 00:10:15,280 Speaker 2: Four point four point one four point two for the 196 00:10:15,320 --> 00:10:18,040 Speaker 2: best part of six months now. Now it has gone 197 00:10:18,080 --> 00:10:20,920 Speaker 2: up in the last six months, whereas late last year 198 00:10:20,960 --> 00:10:23,360 Speaker 2: and there's just been hovering at for ish. 199 00:10:23,000 --> 00:10:27,240 Speaker 3: Yeah, and so, and of all our neighbors around the 200 00:10:27,240 --> 00:10:31,000 Speaker 3: world in similar sort of situations to us, they're except 201 00:10:31,000 --> 00:10:33,280 Speaker 3: for the US, but it's a different situation. 202 00:10:33,520 --> 00:10:35,440 Speaker 1: To just be clear on this. US is different to us. 203 00:10:35,440 --> 00:10:37,920 Speaker 3: They've got a lower actually they've got a lower unemployment number, 204 00:10:37,920 --> 00:10:41,199 Speaker 3: but they have much better productivity. So when you look 205 00:10:41,240 --> 00:10:47,000 Speaker 3: at our terrible productivity number, terrible, I'm talking about productivity 206 00:10:47,040 --> 00:10:53,560 Speaker 3: per employed person, and our sort of moderate unemployment number 207 00:10:53,559 --> 00:10:59,840 Speaker 3: actually by historical numbers, quite a good unemployment number compared 208 00:10:59,880 --> 00:11:04,640 Speaker 3: to do our other neighbors outside of the USA, but Canada, Europe, UK, 209 00:11:05,240 --> 00:11:08,000 Speaker 3: and our friends in New Zealand their unemployment numbers that 210 00:11:08,000 --> 00:11:10,160 Speaker 3: are all got six in front of it, six and. 211 00:11:10,200 --> 00:11:12,640 Speaker 2: Six and even a couple of in Europe at a seven. 212 00:11:12,559 --> 00:11:15,360 Speaker 1: Yes, which sort of is And we're at four point one, 213 00:11:15,400 --> 00:11:17,400 Speaker 1: we're four w one. We're a long way off there. 214 00:11:17,880 --> 00:11:20,559 Speaker 3: And our RBA governor is looking at that number, because 215 00:11:20,559 --> 00:11:22,400 Speaker 3: when what we're here to talk about today is will 216 00:11:22,440 --> 00:11:25,040 Speaker 3: we get a rate reduction this year, she'd be looking 217 00:11:25,040 --> 00:11:27,400 Speaker 3: that number'd be saying, well, it's not where I wanted 218 00:11:27,400 --> 00:11:27,720 Speaker 3: to be. 219 00:11:28,120 --> 00:11:28,720 Speaker 1: What do you think? 220 00:11:29,040 --> 00:11:31,840 Speaker 2: Yes, Because one of the things that has bugged the 221 00:11:31,920 --> 00:11:35,040 Speaker 2: RBA this year and why they've kept break steady when 222 00:11:35,040 --> 00:11:38,920 Speaker 2: other central banks have been cutting, is the poor productivity 223 00:11:38,920 --> 00:11:41,120 Speaker 2: that you mentioned and the fact that we do have 224 00:11:42,160 --> 00:11:45,040 Speaker 2: what we might call a tight labor market. That is 225 00:11:46,280 --> 00:11:49,439 Speaker 2: that the labor market is so strong, the unemployment rate 226 00:11:49,520 --> 00:11:52,000 Speaker 2: is so low and four point one is historically low 227 00:11:53,160 --> 00:11:57,559 Speaker 2: that she fears and the RBA board fears that there 228 00:11:57,559 --> 00:12:01,319 Speaker 2: are some residual inflation wage pressures that are there. Now 229 00:12:01,600 --> 00:12:04,439 Speaker 2: the jury's out on that. We need one of the 230 00:12:04,480 --> 00:12:06,400 Speaker 2: economics I need to see the next couple of quarters. 231 00:12:06,520 --> 00:12:07,160 Speaker 1: I'm not convinced. 232 00:12:07,840 --> 00:12:09,920 Speaker 2: I'm not convinced either. In fact, I think we've actually 233 00:12:09,960 --> 00:12:14,640 Speaker 2: got a lower NAHRU than the RBA is thinking, And 234 00:12:15,880 --> 00:12:17,840 Speaker 2: the evidence of that's starting to come through because the 235 00:12:17,880 --> 00:12:21,960 Speaker 2: wager side of that equation. Because again, why I often 236 00:12:21,960 --> 00:12:23,840 Speaker 2: get to asked question, why don't we target unemployment at 237 00:12:23,880 --> 00:12:26,199 Speaker 2: one percent? 238 00:12:25,280 --> 00:12:26,439 Speaker 1: Per Yeah? 239 00:12:26,440 --> 00:12:28,000 Speaker 2: Why don't we try to get uneployed there because we 240 00:12:28,000 --> 00:12:30,319 Speaker 2: couldn't afford it. We'd be paying the wages shortage and 241 00:12:30,320 --> 00:12:32,959 Speaker 2: skill shortage. We chronic we can't do it. So it's 242 00:12:32,960 --> 00:12:35,120 Speaker 2: one of these things that a little bit of unemployment 243 00:12:35,960 --> 00:12:38,240 Speaker 2: is always going to be there. And it's a question 244 00:12:38,400 --> 00:12:42,480 Speaker 2: in the current analysis of our economy whether it's best 245 00:12:42,520 --> 00:12:44,080 Speaker 2: at three and a half, four, four and a half 246 00:12:44,160 --> 00:12:46,800 Speaker 2: or five. As we said a little bit about four, 247 00:12:47,360 --> 00:12:49,040 Speaker 2: and if we did this is the thing that I 248 00:12:49,080 --> 00:12:53,600 Speaker 2: think the RBA has misread this. In my view, if 249 00:12:53,640 --> 00:12:58,400 Speaker 2: we did have an overtight labor market, there were no 250 00:12:58,520 --> 00:13:00,520 Speaker 2: workers available, just. 251 00:13:00,440 --> 00:13:02,760 Speaker 1: Pockets of shorter they say three point two or something. 252 00:13:02,760 --> 00:13:04,440 Speaker 2: Something like that. If we had it that low, we'd 253 00:13:04,480 --> 00:13:09,280 Speaker 2: be seeing wages go up aggressively. The last three quarters 254 00:13:09,520 --> 00:13:13,679 Speaker 2: wage number one point two, one point zero, zero point eight. 255 00:13:13,679 --> 00:13:16,640 Speaker 2: It's coming down. And the other thing that's coming through 256 00:13:16,640 --> 00:13:19,080 Speaker 2: on the wages side. Seek to a really good survey 257 00:13:19,320 --> 00:13:24,000 Speaker 2: of the wages of jobs that're advertised on their website 258 00:13:24,240 --> 00:13:26,840 Speaker 2: and they call it the average asking wage, because you know, 259 00:13:26,880 --> 00:13:28,959 Speaker 2: I'm putting a job out on there, I'm going to 260 00:13:29,000 --> 00:13:31,280 Speaker 2: pay eighty thousand, one hundred thousand and sixty that whatever. 261 00:13:31,760 --> 00:13:34,559 Speaker 2: And they look at that, and that's turning down already 262 00:13:34,640 --> 00:13:37,679 Speaker 2: with an unemployment rate with just above four percent, so 263 00:13:37,800 --> 00:13:42,520 Speaker 2: it's curious to why is the actual wage numbers from 264 00:13:42,520 --> 00:13:45,000 Speaker 2: the Bureau of Statistics starting to tilt a little lower? 265 00:13:45,480 --> 00:13:49,720 Speaker 2: Why is the seek measure of asking wages from ads 266 00:13:49,760 --> 00:13:52,880 Speaker 2: on their internet site starting to tilt down? I think 267 00:13:52,920 --> 00:13:55,440 Speaker 2: it's because of a couple of things. That big inflow 268 00:13:55,480 --> 00:13:57,959 Speaker 2: of immigration has provided a lot of labor. Sure there's 269 00:13:58,000 --> 00:14:00,679 Speaker 2: other issues associated with it, but most those people want 270 00:14:00,679 --> 00:14:02,600 Speaker 2: a job and they're happy to work for whatever the 271 00:14:02,640 --> 00:14:05,520 Speaker 2: going wages. And I think the slow down in the 272 00:14:05,520 --> 00:14:07,920 Speaker 2: economy that is still there might not be showing up 273 00:14:07,920 --> 00:14:11,560 Speaker 2: in the official unemployment numbers, but it's showing up in 274 00:14:12,200 --> 00:14:15,160 Speaker 2: demand for labor, and I think that's the critical thing. 275 00:14:15,240 --> 00:14:17,839 Speaker 2: So we've got this debate that will probably take a 276 00:14:17,880 --> 00:14:23,520 Speaker 2: few more months to unfold, is whether we can accommodate 277 00:14:23,560 --> 00:14:26,440 Speaker 2: an unemployment rate in the low fours or whether we 278 00:14:26,600 --> 00:14:28,480 Speaker 2: have to go to the mid falls four and a half, 279 00:14:28,560 --> 00:14:30,280 Speaker 2: or whether we have to go towards five percent. And 280 00:14:30,320 --> 00:14:32,520 Speaker 2: the jury's out on that, but the RBA, if they 281 00:14:32,560 --> 00:14:36,000 Speaker 2: wait too long before trimming rates, might find out to 282 00:14:36,040 --> 00:14:39,320 Speaker 2: their peril that we get are sharp falling wages growth 283 00:14:39,360 --> 00:14:42,720 Speaker 2: when unemployment's approaching five percent, and that's don't get another 284 00:14:42,760 --> 00:14:45,240 Speaker 2: percentage point on unemployments. It's about another one hundred and 285 00:14:45,280 --> 00:14:46,160 Speaker 2: fifty thousand people. 286 00:14:46,440 --> 00:14:51,160 Speaker 3: Yeah, so it is a bit of a an experiment, 287 00:14:51,560 --> 00:14:54,920 Speaker 3: and we know who calls it the experiment, but it 288 00:14:54,960 --> 00:14:57,440 Speaker 3: is a bit of an experiment because and we do 289 00:14:57,600 --> 00:14:59,680 Speaker 3: know that the RBA now has to take into account 290 00:14:59,720 --> 00:15:02,560 Speaker 3: the employment and in a lot in a lot different 291 00:15:02,600 --> 00:15:04,760 Speaker 3: way to what they've done in the past. So unemployment 292 00:15:04,800 --> 00:15:08,040 Speaker 3: actually plays a far greater role in the decision around 293 00:15:08,240 --> 00:15:12,680 Speaker 3: interest rates up or down or leave. And in fact, 294 00:15:13,200 --> 00:15:16,720 Speaker 3: putting interest rates up would be a bit scary for 295 00:15:16,720 --> 00:15:18,640 Speaker 3: the RBA if they're trying to if they don't want 296 00:15:18,680 --> 00:15:22,160 Speaker 3: to see the unemployment number rise too far beyond For 297 00:15:22,320 --> 00:15:24,080 Speaker 3: mot On, we don't actually, we sort of do know 298 00:15:24,120 --> 00:15:26,080 Speaker 3: where they think it would be comfortable with a so 299 00:15:26,160 --> 00:15:30,080 Speaker 3: called NEHRU the non accelerating inflation rate of unemployment. They 300 00:15:30,160 --> 00:15:32,440 Speaker 3: it's around four and a half around I think it 301 00:15:32,480 --> 00:15:35,040 Speaker 3: might be slightly higher than that, but for six or something, 302 00:15:35,040 --> 00:15:35,640 Speaker 3: but it doesn't matter. 303 00:15:35,720 --> 00:15:38,560 Speaker 2: That's basically what they're forecasting in their latest statement nunitory 304 00:15:38,560 --> 00:15:40,920 Speaker 2: policy four and a half percent is the peak as 305 00:15:40,960 --> 00:15:43,840 Speaker 2: the peak, So that implies or tells us that four 306 00:15:43,840 --> 00:15:45,360 Speaker 2: and a half plus a minus a tent. 307 00:15:45,280 --> 00:15:48,680 Speaker 3: And that tells us that an interest rate still could 308 00:15:48,680 --> 00:15:53,240 Speaker 3: be on the cards. You know, remotely possible on the cards, 309 00:15:53,280 --> 00:15:55,160 Speaker 3: is what I mean by that, But it definitely says 310 00:15:55,160 --> 00:15:59,040 Speaker 3: to us also probably likely that an interest rate reduction 311 00:15:59,200 --> 00:16:01,320 Speaker 3: before the end of this come is not on the cards. 312 00:16:02,160 --> 00:16:03,920 Speaker 2: I think it's fair to say that, yes, the rate 313 00:16:04,040 --> 00:16:06,120 Speaker 2: hike is not on their agenda. And in fact, the 314 00:16:06,200 --> 00:16:09,200 Speaker 2: last meeting that they had, the governor came out when 315 00:16:09,200 --> 00:16:11,440 Speaker 2: she had her press conferences sort of said, did you 316 00:16:11,480 --> 00:16:13,480 Speaker 2: consider a rate hike at your meeting? Was a question 317 00:16:13,520 --> 00:16:15,960 Speaker 2: that she was asked, and she said no, all we 318 00:16:16,040 --> 00:16:17,840 Speaker 2: considered was rates on hold. But she did be the 319 00:16:18,000 --> 00:16:19,920 Speaker 2: meeting before the meeting, the two or three meetings before 320 00:16:19,960 --> 00:16:21,840 Speaker 2: they said yes we considered a hike, we didn't do it. 321 00:16:22,320 --> 00:16:24,800 Speaker 2: This one said no, we didn't, And we had our 322 00:16:24,880 --> 00:16:28,000 Speaker 2: board discussion, the board of the RBA going through scenarios. 323 00:16:28,040 --> 00:16:30,000 Speaker 2: And that's fair enough. You know what happens to housing, 324 00:16:30,040 --> 00:16:32,880 Speaker 2: what happens globally, what's happening to commodity prices? That what's 325 00:16:32,920 --> 00:16:36,200 Speaker 2: happening to unemployment. So they went through this whole smorgas 326 00:16:36,280 --> 00:16:38,720 Speaker 2: border ideas and that's great, you know, it's fantastic that 327 00:16:38,720 --> 00:16:41,000 Speaker 2: they're doing that now. But a raid hike's not on 328 00:16:41,040 --> 00:16:44,280 Speaker 2: the agenda now, whether we get a rate cut, it 329 00:16:44,280 --> 00:16:48,320 Speaker 2: all depends in a funny way, It's really simple. It 330 00:16:48,400 --> 00:16:51,520 Speaker 2: depends on what happens to inflation, depends what happens to unemployment. 331 00:16:52,040 --> 00:16:55,440 Speaker 2: That's it. You know, we can speculate about house prices 332 00:16:55,480 --> 00:16:57,880 Speaker 2: and speculate about you know, the Aussie dollar if it falls, 333 00:16:57,960 --> 00:16:59,920 Speaker 2: that means they're going to import inflation. There's a mini 334 00:17:00,200 --> 00:17:02,160 Speaker 2: things that people can come up with. But at the 335 00:17:02,240 --> 00:17:06,240 Speaker 2: end of the day, it's really simple, where's unemployment. If 336 00:17:06,240 --> 00:17:10,560 Speaker 2: it's trending higher, it goes against a hike and towards 337 00:17:10,560 --> 00:17:14,840 Speaker 2: a cut. If inflation continues to track lower and lower 338 00:17:14,880 --> 00:17:18,520 Speaker 2: still and it's comfortably within the target, and the RBA 339 00:17:18,600 --> 00:17:22,320 Speaker 2: is happy that it's within the target, they will sort 340 00:17:22,320 --> 00:17:25,160 Speaker 2: of say, look, we can afford to trim raids. So 341 00:17:25,520 --> 00:17:27,760 Speaker 2: that's the well question. 342 00:17:27,800 --> 00:17:31,280 Speaker 3: But I asked you just creaky because there's also about sustainability. 343 00:17:31,359 --> 00:17:34,479 Speaker 3: So if we've got to like a freak, we've got 344 00:17:34,520 --> 00:17:37,680 Speaker 3: a freak inflation number, freakishly good. 345 00:17:37,720 --> 00:17:40,160 Speaker 1: I'm talking about relative to a really nice low one 346 00:17:40,680 --> 00:17:42,560 Speaker 1: one percent frame. Do something stupid. 347 00:17:42,960 --> 00:17:49,320 Speaker 3: But let's say unemployment was still four point one. Will 348 00:17:49,440 --> 00:17:52,320 Speaker 3: she look at unemployment at four point one and say, 349 00:17:52,320 --> 00:17:55,439 Speaker 3: you know what, I don't believe the unemployment numbers at 350 00:17:55,480 --> 00:17:58,760 Speaker 3: the high enough level yet, or in other words, unemployment 351 00:17:58,800 --> 00:18:01,760 Speaker 3: is not high enough yet in order to meet for 352 00:18:01,800 --> 00:18:03,080 Speaker 3: me to be convinced. 353 00:18:02,680 --> 00:18:04,280 Speaker 1: That one percent is sustainable. 354 00:18:04,400 --> 00:18:09,240 Speaker 3: Yeah, I mean, what's the interactional or could she say, wow, 355 00:18:09,400 --> 00:18:14,080 Speaker 3: that's perfect. We've got inflation at one percent and too low. 356 00:18:14,680 --> 00:18:15,199 Speaker 1: It is too late. 357 00:18:15,240 --> 00:18:19,199 Speaker 3: We've done the job. It's one percent plus. We've got 358 00:18:19,240 --> 00:18:20,640 Speaker 3: to employment a perfect number. 359 00:18:20,400 --> 00:18:23,680 Speaker 2: For any good news at four point So they'll trim them. Look, 360 00:18:23,680 --> 00:18:26,560 Speaker 2: they wouldn't. They wouldn't have cut them aggressively. They would 361 00:18:26,560 --> 00:18:29,520 Speaker 2: probably go twenty five, Wait another meeting, twenty five, just 362 00:18:29,520 --> 00:18:32,439 Speaker 2: to see that it's confirmed. So sustainabilities, I think you 363 00:18:32,440 --> 00:18:34,919 Speaker 2: mentioned mark and that is spot on. Anyone can get 364 00:18:34,920 --> 00:18:37,359 Speaker 2: a one quarter down or up on inflation whatever. You've 365 00:18:37,359 --> 00:18:39,000 Speaker 2: got to sort of be a little bit careful with that. 366 00:18:39,000 --> 00:18:41,280 Speaker 1: Well, we had to in front of the last monthly. 367 00:18:41,920 --> 00:18:44,640 Speaker 2: So yeah, last month the August one did have a two. 368 00:18:44,560 --> 00:18:46,480 Speaker 1: In front of two point seven or something else because. 369 00:18:46,320 --> 00:18:49,320 Speaker 2: Some of these subsidies were coming through electricity and transport 370 00:18:49,320 --> 00:18:51,240 Speaker 2: fees and Queensland and a few other bits and bobs 371 00:18:51,280 --> 00:18:54,040 Speaker 2: that were coming through, and petrol was coming down, so 372 00:18:54,440 --> 00:18:56,640 Speaker 2: some of those sort of things were happening. But the 373 00:18:56,680 --> 00:18:59,680 Speaker 2: bottom line is that if we got a nice low 374 00:19:00,119 --> 00:19:05,240 Speaker 2: unemployment rate and inflation was really really low, they would 375 00:19:05,320 --> 00:19:07,680 Speaker 2: trim them. They wouldn't slash them. I know that's a 376 00:19:07,720 --> 00:19:11,760 Speaker 2: subtle difference, but you know, we'd be talking about this 377 00:19:11,800 --> 00:19:14,520 Speaker 2: is over a twelve month period, fifty to seventy five 378 00:19:14,560 --> 00:19:18,639 Speaker 2: points of cuts. Only if unemployment got towards four and 379 00:19:18,680 --> 00:19:20,760 Speaker 2: a half or five percent, we'd be talking one hundred 380 00:19:20,760 --> 00:19:22,760 Speaker 2: to one hundred and fifty pints of cuts. So there's 381 00:19:22,920 --> 00:19:26,119 Speaker 2: sort of matrix of unemployment, inflation, a little bit of 382 00:19:26,119 --> 00:19:28,440 Speaker 2: inflation and no unemployment. So there's all this sort of stuff, 383 00:19:28,480 --> 00:19:29,679 Speaker 2: and so it's. 384 00:19:29,520 --> 00:19:31,600 Speaker 1: Really really important as the politics of all this. 385 00:19:32,320 --> 00:19:35,640 Speaker 2: Election in May, labor would be desperate for a rate 386 00:19:35,680 --> 00:19:38,320 Speaker 2: cut to sort of say we bought it, We've helped 387 00:19:38,320 --> 00:19:40,960 Speaker 2: you with your electricity prices, now we've got inflation down. 388 00:19:41,000 --> 00:19:44,320 Speaker 2: We want a rate cut, so it's really important. By 389 00:19:44,320 --> 00:19:46,840 Speaker 2: the way, mark breaking news. Just by the way, we're 390 00:19:46,840 --> 00:19:49,040 Speaker 2: recording this on inflation day. 391 00:19:49,080 --> 00:19:51,160 Speaker 1: So I'm just going to CPI numbers coming out. 392 00:19:51,160 --> 00:19:52,600 Speaker 2: CPI numbers come out. I'm just going to go to 393 00:19:52,680 --> 00:19:57,560 Speaker 2: the ABS website on the phone and see what they 394 00:19:57,560 --> 00:19:59,399 Speaker 2: have done for the September quarter. Just bear with me, 395 00:19:59,400 --> 00:20:05,120 Speaker 2: because we've got years coming through refreshing my page. Oh 396 00:20:05,160 --> 00:20:08,360 Speaker 2: my god, quarterly two point eight. 397 00:20:08,840 --> 00:20:10,720 Speaker 1: Wow, so that's the September quarter. 398 00:20:11,040 --> 00:20:14,960 Speaker 2: September quarter rows by two percent, but sorry, point two 399 00:20:14,960 --> 00:20:18,159 Speaker 2: percent annual two point eight. I'm just going to go 400 00:20:18,200 --> 00:20:21,880 Speaker 2: to these trimmed mean measures. So let me scroll down 401 00:20:21,920 --> 00:20:23,159 Speaker 2: the page. 402 00:20:24,160 --> 00:20:26,640 Speaker 1: I'll be over three trimmed mean. 403 00:20:27,680 --> 00:20:32,480 Speaker 2: Was point eight three point five annual, And just by 404 00:20:32,520 --> 00:20:35,040 Speaker 2: the way, I'll have a little look at the monthly 405 00:20:35,840 --> 00:20:40,879 Speaker 2: figure for September. Bear with me because I love the 406 00:20:40,880 --> 00:20:45,760 Speaker 2: monthly data because right up to date. My god, I'm 407 00:20:45,760 --> 00:20:50,439 Speaker 2: glad you're sitting down two point one what in the 408 00:20:50,520 --> 00:20:55,360 Speaker 2: year to september monthly data? Two point one percent annual inflation, 409 00:20:55,560 --> 00:20:57,679 Speaker 2: So that'll start feeding into the December quarter. So I'm 410 00:20:57,680 --> 00:21:02,119 Speaker 2: sitting here right now really excited. Yeah, pardon me, who 411 00:21:02,240 --> 00:21:04,159 Speaker 2: fucking ray, we've got inflation. I won't say we've got 412 00:21:04,160 --> 00:21:07,200 Speaker 2: it under control, but this is such an encouraging indicator 413 00:21:07,240 --> 00:21:10,840 Speaker 2: again as we're having so two point one annual inflation, 414 00:21:11,920 --> 00:21:14,560 Speaker 2: just looking at where the hell it came it was in. Yeah, 415 00:21:15,080 --> 00:21:17,679 Speaker 2: electricity prices are down twenty four percent through the year. 416 00:21:17,720 --> 00:21:19,920 Speaker 2: Government subsidedes. It's fair enough, so she's already said she's 417 00:21:19,920 --> 00:21:22,440 Speaker 2: not going to like transport were minus three point eight, 418 00:21:22,480 --> 00:21:24,160 Speaker 2: communications minus point eight. 419 00:21:25,440 --> 00:21:28,080 Speaker 1: Where are we any other big reductions? 420 00:21:28,480 --> 00:21:31,240 Speaker 2: Well, things like meat and seaford were only point nine, 421 00:21:31,800 --> 00:21:36,399 Speaker 2: dairy minus point two. But see things like cigarettes are 422 00:21:36,480 --> 00:21:39,800 Speaker 2: up twelve percent. That's all bloody tap out. Yeap Housing 423 00:21:39,880 --> 00:21:42,120 Speaker 2: was one point six and that's dwelling rent was still 424 00:21:42,160 --> 00:21:45,520 Speaker 2: high six point six percent, so dwelling rent's still high. 425 00:21:45,880 --> 00:21:49,000 Speaker 2: Services health was four point eight, so it's a health servicing. 426 00:21:49,080 --> 00:21:52,520 Speaker 2: Holiday travel two and a half right on target. So 427 00:21:52,600 --> 00:21:58,240 Speaker 2: we've got this wow. Two point one for the monthly indicator, 428 00:21:58,480 --> 00:22:01,280 Speaker 2: two point eight for the headline figure. Of course, the 429 00:22:01,320 --> 00:22:04,399 Speaker 2: trim raine is high because they exclude things like this 430 00:22:04,520 --> 00:22:08,080 Speaker 2: electricity subsidy. And if you're the RBA, now I reckon, look, 431 00:22:08,119 --> 00:22:11,280 Speaker 2: they wouldn't be cracking the champagne, but they'd be saying 432 00:22:11,840 --> 00:22:13,879 Speaker 2: that's a really good result. We are happy with that. 433 00:22:13,960 --> 00:22:18,159 Speaker 2: And yes there are distortions from government tax policy, but 434 00:22:18,280 --> 00:22:22,199 Speaker 2: it feeds into inflation expectations because you and me and 435 00:22:22,240 --> 00:22:25,480 Speaker 2: everybody listening and everybody out there is getting that lower 436 00:22:25,480 --> 00:22:27,800 Speaker 2: electricity cost, they're paying a bit less for the moment 437 00:22:27,840 --> 00:22:31,320 Speaker 2: for their petrol. With inflation at two point one and 438 00:22:31,359 --> 00:22:33,160 Speaker 2: wages at three and a half or three and three 439 00:22:33,240 --> 00:22:36,640 Speaker 2: quarter percent, I'm certainly not saying the cost of living 440 00:22:36,680 --> 00:22:42,480 Speaker 2: crisis is over, but it's turning. It's good news that 441 00:22:42,560 --> 00:22:45,119 Speaker 2: inflation's falling. And just by the way, when we look 442 00:22:45,119 --> 00:22:47,440 Speaker 2: at some of the consumer sentiment numbers in the last month, 443 00:22:47,480 --> 00:22:49,159 Speaker 2: they've been a little bit better. So maybe people are 444 00:22:49,200 --> 00:22:53,479 Speaker 2: realizing fuel some of that horrible inflation which was really 445 00:22:53,560 --> 00:22:58,119 Speaker 2: killing me financially. It's not over, but it's no longer 446 00:22:58,160 --> 00:23:02,600 Speaker 2: that by a constrictor squeeze on my finances. 447 00:23:02,720 --> 00:23:04,359 Speaker 1: So just say give us some context. 448 00:23:04,400 --> 00:23:09,640 Speaker 3: So all it means is that the increase in the 449 00:23:09,680 --> 00:23:14,080 Speaker 3: cost of goods and services for the September quarter from 450 00:23:14,280 --> 00:23:17,080 Speaker 3: the June quarter and also for the year to the 451 00:23:17,160 --> 00:23:20,080 Speaker 3: end of September, are lower. It doesn't mean that the 452 00:23:20,080 --> 00:23:21,119 Speaker 3: cost of living is lower. 453 00:23:21,320 --> 00:23:24,479 Speaker 2: No, no, no, the rate of increase is that's important. 454 00:23:24,560 --> 00:23:26,600 Speaker 2: So it's only two point one percent using that monthly 455 00:23:26,600 --> 00:23:27,800 Speaker 2: think at two point eight using that. 456 00:23:27,880 --> 00:23:30,439 Speaker 3: So not all all of a sudden getting a life's 457 00:23:30,480 --> 00:23:31,000 Speaker 3: not cheaper. 458 00:23:31,400 --> 00:23:35,000 Speaker 2: No no, no, life is not cheaper. It's just the 459 00:23:35,080 --> 00:23:37,480 Speaker 2: rate of increases to where it should be. And again 460 00:23:37,560 --> 00:23:39,760 Speaker 2: that we've got to remember that when that two to 461 00:23:39,760 --> 00:23:42,040 Speaker 2: three percent target plus two to three percent target was 462 00:23:42,080 --> 00:23:46,680 Speaker 2: set thirty odd years ago and confirmed by Peter Costello 463 00:23:46,760 --> 00:23:48,680 Speaker 2: when he became Treasurer in ninety ninety six, I think 464 00:23:48,680 --> 00:23:49,000 Speaker 2: it was. 465 00:23:49,320 --> 00:23:51,360 Speaker 1: And confirmed last year too, confirmed. 466 00:23:51,000 --> 00:23:53,280 Speaker 2: Again by Michelle bullockin gin Charms, which is good. Yes, 467 00:23:53,800 --> 00:23:55,960 Speaker 2: I don't think any side of police would ever dare 468 00:23:56,520 --> 00:24:00,359 Speaker 2: to tinker with that. So two and a half it's 469 00:24:00,400 --> 00:24:04,320 Speaker 2: in the context that on average and in normal circumstances, 470 00:24:04,400 --> 00:24:06,520 Speaker 2: Australian wages gout by three and a half to four. 471 00:24:06,640 --> 00:24:08,440 Speaker 2: So if you've got three, just say we take the 472 00:24:08,480 --> 00:24:10,080 Speaker 2: lower of that three and a half percent wages growth 473 00:24:10,240 --> 00:24:11,440 Speaker 2: inflation at two and a half. 474 00:24:11,280 --> 00:24:12,560 Speaker 1: Percent, we're ahead of the game. 475 00:24:12,600 --> 00:24:16,800 Speaker 2: We're ahead slowly but steadily. It's a get rich slowly 476 00:24:16,880 --> 00:24:20,159 Speaker 2: rather get rich quick approach, and again we've got a 477 00:24:20,200 --> 00:24:23,400 Speaker 2: lot of ground to catch up after the falling real 478 00:24:23,400 --> 00:24:26,440 Speaker 2: wages from that inflation spike over the last couple of years. 479 00:24:26,800 --> 00:24:28,879 Speaker 2: But it's not just light at the end of the tunnel. 480 00:24:28,920 --> 00:24:30,080 Speaker 2: It's starting to happen. 481 00:24:30,359 --> 00:24:33,320 Speaker 3: So because if I could go back a year, I 482 00:24:33,359 --> 00:24:35,320 Speaker 3: can't remember what it was for September quarter last year. 483 00:24:35,320 --> 00:24:37,679 Speaker 3: If for the dunequart liastures like six percent or something, 484 00:24:37,920 --> 00:24:40,120 Speaker 3: it was very high, yes, And then it was three 485 00:24:40,119 --> 00:24:42,080 Speaker 3: point eight percent for the Dune quarter this year. 486 00:24:42,160 --> 00:24:43,240 Speaker 1: Correct, it's now. 487 00:24:43,280 --> 00:24:46,320 Speaker 2: Three point five for the headline figure, yep, two point 488 00:24:46,320 --> 00:24:47,359 Speaker 2: eight for the headline figure and. 489 00:24:47,359 --> 00:24:51,080 Speaker 3: Three point five for the t So it's the reserving 490 00:24:51,160 --> 00:24:52,800 Speaker 3: must be happy it's going in the right direction. 491 00:24:53,440 --> 00:24:53,680 Speaker 2: Yes. 492 00:24:54,440 --> 00:24:56,280 Speaker 3: Do you think this is enough to get her excited 493 00:24:56,320 --> 00:24:58,919 Speaker 3: about giving us a pre Christmas reduction. 494 00:25:01,000 --> 00:25:05,560 Speaker 2: With that unemployment number of four point one? Probably not? 495 00:25:06,119 --> 00:25:08,640 Speaker 2: I think. Well, they meet next week Melbourne Cup day, 496 00:25:08,760 --> 00:25:11,520 Speaker 2: half an hour before they jump in the races. That's 497 00:25:11,520 --> 00:25:14,600 Speaker 2: a busy afternoon for many people. But so next next Tuesday, 498 00:25:15,200 --> 00:25:20,720 Speaker 2: two thirty Eastern coast time, not Conic Queensland sorry daylight saving. Yeah, 499 00:25:20,720 --> 00:25:23,960 Speaker 2: we're going to get that RBA decision I think you'll 500 00:25:24,000 --> 00:25:27,280 Speaker 2: see with this number and just the other economic indicators too. 501 00:25:27,320 --> 00:25:29,200 Speaker 2: You know, we know the economy is still pretty sluggis 502 00:25:29,200 --> 00:25:32,400 Speaker 2: We know the world's cutting interest rates, most other countries are. 503 00:25:33,720 --> 00:25:38,520 Speaker 2: She'll say that the board considered the circumstances with which 504 00:25:38,560 --> 00:25:42,679 Speaker 2: they would be finding it possible to cut interstrates, and 505 00:25:42,760 --> 00:25:45,760 Speaker 2: she might outline that. She might say that we need 506 00:25:45,800 --> 00:25:49,200 Speaker 2: another quarter or two of low inflation. We might need 507 00:25:49,240 --> 00:25:52,600 Speaker 2: to see another three or four months if the unemployment 508 00:25:52,680 --> 00:25:54,760 Speaker 2: rate creeps up. We want to see wages growth continue 509 00:25:54,760 --> 00:25:57,560 Speaker 2: to be well contained. We'll keep an eye on commodity prices, 510 00:25:57,560 --> 00:25:59,959 Speaker 2: the global again, Mark there's one hundred and one more 511 00:26:00,119 --> 00:26:02,480 Speaker 2: parts of this equation, but I think we can with 512 00:26:02,560 --> 00:26:05,040 Speaker 2: these numbers that popped up five minutes ago. I think 513 00:26:05,080 --> 00:26:07,640 Speaker 2: it's safe to say raid hikes are dead. If ever 514 00:26:07,640 --> 00:26:09,960 Speaker 2: they had a sort of hint of life about them, 515 00:26:10,000 --> 00:26:16,000 Speaker 2: I think we can comfortably say no way. The debate now, 516 00:26:16,200 --> 00:26:20,160 Speaker 2: I think, more generally will focus on when and how 517 00:26:20,160 --> 00:26:23,800 Speaker 2: many rate cuts are likely. As I sit here now, 518 00:26:24,359 --> 00:26:28,600 Speaker 2: with a quick instant analysis, i'd say probably the first 519 00:26:28,640 --> 00:26:31,720 Speaker 2: cut to be fair won't be until the February meeting. 520 00:26:32,359 --> 00:26:34,960 Speaker 2: By then they'll have another quarter inflation number to reinforce 521 00:26:35,000 --> 00:26:38,439 Speaker 2: this good. The December numbers, Yes, December and December quarter numbers. 522 00:26:38,440 --> 00:26:41,840 Speaker 2: They'll have another couple of unemployment numbers, and I still 523 00:26:41,840 --> 00:26:43,800 Speaker 2: think unemployment is going to drift higher because the job 524 00:26:43,800 --> 00:26:46,080 Speaker 2: adds are still weak and the economy is still relatively weak. 525 00:26:46,400 --> 00:26:48,440 Speaker 2: And they'll have a bit more information from the world economy. 526 00:26:48,440 --> 00:26:51,600 Speaker 2: You know, US election, heaven forbid, you know that goodness 527 00:26:51,680 --> 00:26:52,919 Speaker 2: knows what to expect. 528 00:26:52,520 --> 00:26:55,320 Speaker 3: There because they have targeted that though, so they are, 529 00:26:55,880 --> 00:26:58,280 Speaker 3: they are following her closely. They're won't about the inflationary 530 00:26:58,280 --> 00:27:00,880 Speaker 3: pressure either party winning, Yes, and. 531 00:27:00,840 --> 00:27:02,520 Speaker 2: From around the world. So the US obviously the biggest 532 00:27:02,520 --> 00:27:05,080 Speaker 2: economy in the world. What happens there is hugely important. 533 00:27:05,119 --> 00:27:08,560 Speaker 2: And let's see, but we know that commodity prices is down. China, 534 00:27:08,640 --> 00:27:10,960 Speaker 2: our major export market's still very weak. They're cutting into 535 00:27:10,960 --> 00:27:13,080 Speaker 2: strates since since we spoke last Mark. 536 00:27:13,200 --> 00:27:18,639 Speaker 1: So but that's the stimulation. So yes, stil them. 537 00:27:18,280 --> 00:27:20,240 Speaker 2: Bad economy in the meantime, So we're sort of seeing 538 00:27:20,240 --> 00:27:23,280 Speaker 2: this really what do we call it? This really mixed 539 00:27:23,320 --> 00:27:25,600 Speaker 2: picture of things happening. But I think it's fair to 540 00:27:25,640 --> 00:27:29,040 Speaker 2: say in the RBA acknowledge this interestrates now at four 541 00:27:29,040 --> 00:27:33,400 Speaker 2: point three five percent are restrictive. Yep, they're hurting, and 542 00:27:33,640 --> 00:27:37,440 Speaker 2: the RBA governor would say they were meant to. We 543 00:27:37,560 --> 00:27:40,160 Speaker 2: needed to, We needed to get that inflation rate down, 544 00:27:40,760 --> 00:27:43,760 Speaker 2: and we're getting there. We want to get another couple 545 00:27:43,800 --> 00:27:48,400 Speaker 2: of months of confirmation, but we're getting there. We don't 546 00:27:48,400 --> 00:27:52,640 Speaker 2: need to hike anymore because of the inflation picture, which 547 00:27:52,680 --> 00:27:54,399 Speaker 2: means that we're probably going to keep them steady and 548 00:27:54,440 --> 00:27:57,800 Speaker 2: we could cut. If this is where she articulates. The next 549 00:27:57,800 --> 00:28:01,639 Speaker 2: inflation ratings again low next quarterly one, and the unplant 550 00:28:01,760 --> 00:28:02,280 Speaker 2: rate ticks. 551 00:28:02,160 --> 00:28:03,160 Speaker 1: Up, we can blow it up. 552 00:28:04,320 --> 00:28:08,800 Speaker 2: Oh gee, I mean blow it up against this, against this, 553 00:28:08,880 --> 00:28:10,600 Speaker 2: and so to say the rate hikes come back onto 554 00:28:10,600 --> 00:28:11,560 Speaker 2: the agenda. 555 00:28:11,320 --> 00:28:13,320 Speaker 3: Or at least no rate reductions. In other words, it'd 556 00:28:13,720 --> 00:28:15,000 Speaker 3: blow inflation number up. 557 00:28:15,800 --> 00:28:17,760 Speaker 2: It'd be it's got to be a demand if it's 558 00:28:17,760 --> 00:28:19,439 Speaker 2: not just a temporary jump in the oil price that 559 00:28:19,480 --> 00:28:21,359 Speaker 2: from the Middle East and all the horrible things that 560 00:28:21,359 --> 00:28:24,679 Speaker 2: are going on there, and it's not just going to 561 00:28:24,680 --> 00:28:27,960 Speaker 2: be necessarily whoever wins this presidential election, I don't don't. 562 00:28:28,080 --> 00:28:30,959 Speaker 2: I think both, whether it's Harris or Trump, both them 563 00:28:31,000 --> 00:28:33,240 Speaker 2: going to do something on a trade war with China, 564 00:28:33,400 --> 00:28:36,280 Speaker 2: reduction taxes and higher tas and this sort of stuff 565 00:28:36,280 --> 00:28:39,000 Speaker 2: and taxes, so they've got different policies, of course they. 566 00:28:38,840 --> 00:28:42,160 Speaker 1: Do, but they're both potentially inflationary there. 567 00:28:42,040 --> 00:28:43,880 Speaker 2: And in fact, interestingly market it's a really good point 568 00:28:43,880 --> 00:28:47,440 Speaker 2: that you raise. In the last three or four weeks, 569 00:28:47,840 --> 00:28:50,840 Speaker 2: as Trump has sort of looks more likely to win, 570 00:28:50,960 --> 00:28:53,800 Speaker 2: not guaranteed, but more likely win, the bond market's sold off. 571 00:28:53,840 --> 00:28:57,520 Speaker 2: Bond yields have jumped, and that's a precursor to the 572 00:28:57,560 --> 00:28:59,680 Speaker 2: effect that they think, well, if he gets in, he's 573 00:28:59,680 --> 00:29:02,160 Speaker 2: going to imposed some big tariffs which pushed that prices. 574 00:29:02,160 --> 00:29:04,200 Speaker 2: He's going to get some big tax cuts, which stimulates 575 00:29:04,240 --> 00:29:07,120 Speaker 2: the economy and the FED even though they're expected to 576 00:29:07,120 --> 00:29:09,600 Speaker 2: cut interestrates the US Federal Reserve same as our RBA, 577 00:29:10,240 --> 00:29:12,480 Speaker 2: they're expected to cut interest rates. Maybe they won't do 578 00:29:12,520 --> 00:29:14,920 Speaker 2: too much anymore. And so the bond market's selling off. 579 00:29:14,920 --> 00:29:18,280 Speaker 2: So getting all this incredible movement in the yields based 580 00:29:18,320 --> 00:29:23,880 Speaker 2: partly or importantly on who's going to win this election. 581 00:29:24,000 --> 00:29:27,280 Speaker 2: So markets will be watching that election outcome very very close. 582 00:29:27,440 --> 00:29:29,480 Speaker 2: So oh, yes, the RBA. 583 00:29:29,400 --> 00:29:31,920 Speaker 1: Government, do you think she'll talk about that in her NAT. 584 00:29:32,520 --> 00:29:36,040 Speaker 2: Because her next press conference is before we know the 585 00:29:36,080 --> 00:29:36,520 Speaker 2: results of this. 586 00:29:37,440 --> 00:29:39,320 Speaker 1: But do you think she might flag it so because 587 00:29:39,440 --> 00:29:40,880 Speaker 1: international market. 588 00:29:40,920 --> 00:29:44,320 Speaker 2: I know she's been asked about the role of government 589 00:29:44,360 --> 00:29:48,600 Speaker 2: spending in Australia on keeping inflation higher for longer. She 590 00:29:48,680 --> 00:29:50,360 Speaker 2: let that one go through to the keeper. She doesn't 591 00:29:50,360 --> 00:29:52,640 Speaker 2: want to get into politics, and I think she explained 592 00:29:52,680 --> 00:29:54,680 Speaker 2: that by saying, Jim Charmers has got his job to 593 00:29:54,680 --> 00:29:57,440 Speaker 2: do in terms of budget and the cost of living 594 00:29:57,520 --> 00:29:58,920 Speaker 2: relief and all this sort of stuff. I've got my 595 00:29:59,000 --> 00:30:02,200 Speaker 2: job to do with inflation unemployment. So she's very diplomatic 596 00:30:02,600 --> 00:30:05,120 Speaker 2: in terms of not answer it. I don't think she'd 597 00:30:05,160 --> 00:30:08,400 Speaker 2: jump into not into the US politics. She'll talk about 598 00:30:08,440 --> 00:30:11,040 Speaker 2: the world economy, she'll talk about what's happening to the 599 00:30:11,080 --> 00:30:14,560 Speaker 2: bond market, She'll talk about global inflation pressures. But I 600 00:30:14,560 --> 00:30:16,240 Speaker 2: don't think she'd say, well, if Trump wins, it's a 601 00:30:16,240 --> 00:30:18,240 Speaker 2: disaster for US. I don't think she'll say that. 602 00:30:18,680 --> 00:30:19,480 Speaker 1: Do you think that. 603 00:30:21,160 --> 00:30:26,000 Speaker 3: Michelle Borlock right now is sitting there as excited as 604 00:30:26,320 --> 00:30:29,800 Speaker 3: you are, and I am. 605 00:30:29,920 --> 00:30:32,880 Speaker 2: I think she is. She wouldn't show it because she's 606 00:30:33,040 --> 00:30:36,160 Speaker 2: central banker. Central bankers don't jump up and down like 607 00:30:36,160 --> 00:30:38,960 Speaker 2: you and I good bit of news. But I think 608 00:30:39,080 --> 00:30:42,320 Speaker 2: secretly or behind closed doors, she'd be saying this inflation 609 00:30:42,480 --> 00:30:45,800 Speaker 2: uses very good. And by the way, I'm happy that 610 00:30:45,880 --> 00:30:48,800 Speaker 2: it's occurring when we've got a four point one unemployment rate. 611 00:30:49,920 --> 00:30:53,560 Speaker 2: And I think the RBA board and Michelle Bullock in 612 00:30:53,600 --> 00:30:59,520 Speaker 2: particular are certainly smart enough and wise enough and pragmatic 613 00:30:59,600 --> 00:31:02,520 Speaker 2: enough to to say, maybe we did get this Naghry wrong. 614 00:31:02,600 --> 00:31:07,160 Speaker 2: Maybe we can have an austrain economy with an unemployment 615 00:31:07,280 --> 00:31:11,320 Speaker 2: rate between because every month from three and a half 616 00:31:11,320 --> 00:31:15,480 Speaker 2: to four and a half without there being sustained wages 617 00:31:15,640 --> 00:31:20,040 Speaker 2: problems being too high. And maybe we can trim rates again. 618 00:31:20,040 --> 00:31:21,920 Speaker 2: And all we're talking is fifteen hundred points in year, 619 00:31:22,200 --> 00:31:24,400 Speaker 2: not a massive rate cutting cycle coming up next year. 620 00:31:24,760 --> 00:31:26,280 Speaker 2: But we can trim rates a little bit to give 621 00:31:26,320 --> 00:31:30,320 Speaker 2: a bit of relief to grow the economy. And importantly, 622 00:31:30,560 --> 00:31:32,200 Speaker 2: this is what I think she might say at her 623 00:31:32,240 --> 00:31:34,800 Speaker 2: press conference next week. We want to lock in the 624 00:31:34,880 --> 00:31:38,080 Speaker 2: employment gains. You know, we came through the COVID pandemic 625 00:31:38,680 --> 00:31:41,720 Speaker 2: when nobody thought we'd get an unemployment rate at four percent. 626 00:31:43,280 --> 00:31:45,480 Speaker 2: Nobody more or less about three and a half at 627 00:31:45,520 --> 00:31:48,920 Speaker 2: one stage, but nobody thought that. But here we are. 628 00:31:49,560 --> 00:31:52,560 Speaker 2: It's a little bit like Mark I go back a 629 00:31:52,560 --> 00:31:54,640 Speaker 2: fair way. It was a bit like when inflation did 630 00:31:54,680 --> 00:31:56,800 Speaker 2: fall to two to three percent in the early nineties. 631 00:31:56,840 --> 00:32:00,200 Speaker 2: We remember Paul keating, we snapped the inflation stick. When 632 00:32:00,200 --> 00:32:03,120 Speaker 2: the RBA high interestrates is seventeen percent back in the 633 00:32:03,200 --> 00:32:05,960 Speaker 2: late eighties early nineties. They didn't do it to target inflation. 634 00:32:06,480 --> 00:32:09,880 Speaker 2: It happened by accident. But when it happened, let's just 635 00:32:09,920 --> 00:32:11,600 Speaker 2: take it. It's like finding a fifty dollars eight on 636 00:32:11,600 --> 00:32:13,080 Speaker 2: the ground. I'll pick it up and stealing them a pocket, 637 00:32:13,120 --> 00:32:16,840 Speaker 2: your beauty. If we find that one of the legacies 638 00:32:17,360 --> 00:32:19,960 Speaker 2: of all the COVID and all these other things that 639 00:32:20,000 --> 00:32:22,160 Speaker 2: have occurred is that we've got an unemployment rate in 640 00:32:22,200 --> 00:32:26,960 Speaker 2: Australia that's sustainable your point, at four percent plus and 641 00:32:27,000 --> 00:32:29,840 Speaker 2: minus a little bit unemploy unemployment rates sorry, at four 642 00:32:29,840 --> 00:32:33,520 Speaker 2: percent with inflation averaging about two and a half. That 643 00:32:33,720 --> 00:32:36,000 Speaker 2: is an outcome no one would have dreamed about. And 644 00:32:36,080 --> 00:32:38,320 Speaker 2: as an economist, I would take that, and I'm sure 645 00:32:38,320 --> 00:32:40,480 Speaker 2: Michelle Bullock would be doing a little bit of a 646 00:32:40,560 --> 00:32:41,480 Speaker 2: jig in her office. 647 00:32:41,600 --> 00:32:43,680 Speaker 1: So we do that goldenlock scenario. 648 00:32:44,960 --> 00:32:48,320 Speaker 2: I'm always reluctant to say that, but it's looking as 649 00:32:48,360 --> 00:32:54,640 Speaker 2: if we could with careful management of economic policy, not 650 00:32:54,680 --> 00:32:56,440 Speaker 2: just from the Reserve Bank. But of course we've got 651 00:32:56,680 --> 00:32:59,440 Speaker 2: the budget, we've got our own election here by May 652 00:32:59,520 --> 00:33:02,520 Speaker 2: next year, that with careful policy management, we could just 653 00:33:02,560 --> 00:33:04,840 Speaker 2: sort of manage the economy a whole lot better than 654 00:33:05,360 --> 00:33:06,240 Speaker 2: you know, we used to do. 655 00:33:06,560 --> 00:33:11,000 Speaker 3: So if we get a couple of rate reductions next year, 656 00:33:12,760 --> 00:33:14,680 Speaker 3: and if we can keep unemployment of the. 657 00:33:16,360 --> 00:33:18,720 Speaker 1: Low force even at four point five, it is not 658 00:33:18,760 --> 00:33:21,720 Speaker 1: that I pretty good. Yes, I would be happy with 659 00:33:21,760 --> 00:33:22,280 Speaker 1: four point five. 660 00:33:22,280 --> 00:33:23,840 Speaker 3: I don't want anyone to lose a job, don't get 661 00:33:23,840 --> 00:33:25,920 Speaker 3: me wrong, But four point five, I mean, that's still 662 00:33:25,920 --> 00:33:29,000 Speaker 3: a bloody good number historically in this country. If we 663 00:33:29,080 --> 00:33:31,600 Speaker 3: get particularly given what's going on in other countries and 664 00:33:31,720 --> 00:33:41,720 Speaker 3: relatively speaking, we would be in a proper reset of 665 00:33:41,480 --> 00:33:48,440 Speaker 3: our economy, good, good inflation, good unemployment. GDP probably needs 666 00:33:48,440 --> 00:33:50,160 Speaker 3: a bit of a kick along, and that'll come along 667 00:33:50,160 --> 00:33:53,280 Speaker 3: as a result of interest rate reductions. We could get 668 00:33:53,280 --> 00:33:56,160 Speaker 3: GDP back up to the high twos, maybe even a 669 00:33:56,200 --> 00:33:57,000 Speaker 3: three yep. 670 00:33:56,880 --> 00:33:58,840 Speaker 2: High twos would be a good result. And again, as 671 00:33:58,880 --> 00:34:01,760 Speaker 2: you mentioned, the Chinese steam as we know it, takes 672 00:34:01,800 --> 00:34:04,280 Speaker 2: a while from a policy change to impact the economy, 673 00:34:04,280 --> 00:34:06,040 Speaker 2: but the fact that the Chinese have done so much 674 00:34:06,640 --> 00:34:09,640 Speaker 2: will help our economy next year. 675 00:34:09,800 --> 00:34:15,600 Speaker 3: Yeah, so we potentially in twenty twenty five, sometime in 676 00:34:15,600 --> 00:34:18,239 Speaker 3: twenty twenty five could be in pretty good shape. 677 00:34:19,080 --> 00:34:21,200 Speaker 2: I think we could be in pretty good shape. Yes, 678 00:34:21,239 --> 00:34:24,640 Speaker 2: the economy will recover, bottom line GDP will will pick 679 00:34:24,719 --> 00:34:27,080 Speaker 2: up a bit. And again it's the interstrate reductions that 680 00:34:27,360 --> 00:34:31,080 Speaker 2: we expect to happen some of this, and don't forget 681 00:34:31,120 --> 00:34:33,480 Speaker 2: even the US cutting interstrates and Europe cutting instrates. They're 682 00:34:33,480 --> 00:34:35,479 Speaker 2: going to improve their economies. And while we don't trade 683 00:34:35,480 --> 00:34:38,799 Speaker 2: a huge amount with the Europeans and the Americans, if 684 00:34:38,800 --> 00:34:41,319 Speaker 2: they're growing stronger, they do more banned for from China, 685 00:34:41,400 --> 00:34:43,640 Speaker 2: so China demands well from US. So a strong world 686 00:34:43,640 --> 00:34:47,680 Speaker 2: economy is good news for us. And with everybody cutting rates, Yeah, 687 00:34:47,719 --> 00:34:49,799 Speaker 2: I think we're going to see an upward revision to 688 00:34:49,800 --> 00:34:52,880 Speaker 2: world GDP next year. So that's a good thing. If 689 00:34:52,920 --> 00:34:55,480 Speaker 2: we can keep unemployment relatively low, that's a great thing, 690 00:34:55,600 --> 00:34:58,120 Speaker 2: you know, if we can keep it in the fours again. 691 00:34:58,680 --> 00:35:00,200 Speaker 2: Just by the way, do you know that in the 692 00:35:00,280 --> 00:35:05,479 Speaker 2: last forty nine years we've only had two years where 693 00:35:05,480 --> 00:35:08,600 Speaker 2: the unemployment rate's been below four and a half percent. 694 00:35:08,680 --> 00:35:10,239 Speaker 1: So, in other words, every other year has been above 695 00:35:10,239 --> 00:35:10,680 Speaker 1: four and a half. 696 00:35:10,719 --> 00:35:13,040 Speaker 2: Forty seven of the forty nine we've been above four 697 00:35:13,040 --> 00:35:15,640 Speaker 2: and a half, five, six, sevens and eights. And so 698 00:35:15,800 --> 00:35:20,360 Speaker 2: this time around again, let's try to maintain it. Okay, 699 00:35:20,400 --> 00:35:23,400 Speaker 2: we didn't necessarily target it, but we've got there, and 700 00:35:23,520 --> 00:35:28,160 Speaker 2: let's make sure that monetary policy, budget policy, dare I say, 701 00:35:28,360 --> 00:35:30,960 Speaker 2: wages policy, industrial relations, all these things that feed in 702 00:35:31,000 --> 00:35:34,879 Speaker 2: the labor market, productivity, economic growth, let's try to get 703 00:35:34,880 --> 00:35:37,800 Speaker 2: them right. This is where I'm I hope I'm optimistic 704 00:35:37,840 --> 00:35:40,360 Speaker 2: about the election campaign and it doesn't descend into a 705 00:35:40,560 --> 00:35:44,279 Speaker 2: name calling. You know you will, I fear it will. 706 00:35:44,440 --> 00:35:47,719 Speaker 2: But we actually get some good policy ideas on the 707 00:35:47,760 --> 00:35:51,840 Speaker 2: table that we think about, tax policy, labor market policy, 708 00:35:52,360 --> 00:35:55,399 Speaker 2: immigration policy, housing policy, all these things that are really 709 00:35:55,400 --> 00:35:59,680 Speaker 2: important for us to grow the economy in a sustained way. 710 00:36:00,760 --> 00:36:02,279 Speaker 3: Just one or two more things before we get to 711 00:36:02,280 --> 00:36:07,400 Speaker 3: your board. The trim mean, is that going to steal 712 00:36:08,320 --> 00:36:09,520 Speaker 3: your funder our funder. 713 00:36:09,960 --> 00:36:12,680 Speaker 2: It'll take some of the thunder away. Yes, Because as 714 00:36:12,719 --> 00:36:17,680 Speaker 2: we acknowledge, it's obvious the government subsidies did take a 715 00:36:17,760 --> 00:36:21,399 Speaker 2: chunk off the headline, and she said inflation, and she 716 00:36:21,480 --> 00:36:23,080 Speaker 2: has said even though it's not actually in the RBA 717 00:36:23,160 --> 00:36:26,160 Speaker 2: mandate by the way, it's headline inflation. It's their target 718 00:36:26,239 --> 00:36:28,439 Speaker 2: just by the way. But we focus on trimmed means. 719 00:36:28,440 --> 00:36:29,200 Speaker 1: She's already said that. 720 00:36:29,239 --> 00:36:30,640 Speaker 2: She has said that at the last couple of weeks, 721 00:36:30,640 --> 00:36:32,279 Speaker 2: the trim means the one that we want to get down, 722 00:36:32,320 --> 00:36:35,239 Speaker 2: and she's coming down, but it's still that's still not 723 00:36:35,280 --> 00:36:36,759 Speaker 2: in the target. As we said, that's still three and 724 00:36:36,800 --> 00:36:37,040 Speaker 2: a half. 725 00:36:37,160 --> 00:36:38,240 Speaker 1: Yeah, so three and a half. 726 00:36:39,000 --> 00:36:41,160 Speaker 3: If I want to steal our funder a little bit, 727 00:36:42,239 --> 00:36:44,600 Speaker 3: it's probably three and a Half's the more relevant number 728 00:36:44,600 --> 00:36:47,040 Speaker 3: two because a large percentage. 729 00:36:46,480 --> 00:36:50,000 Speaker 1: Of what we're gloating about at the moment is off 730 00:36:50,000 --> 00:36:51,880 Speaker 1: the back of the rebates. 731 00:36:51,760 --> 00:36:54,680 Speaker 2: Off the back of the electricity rebate, some of the 732 00:36:54,680 --> 00:36:56,879 Speaker 2: rental rebate, and as we said, at the state government level, 733 00:36:56,960 --> 00:36:58,440 Speaker 2: transport fairs and these sort of things. 734 00:36:58,719 --> 00:37:01,080 Speaker 3: So when doctor Jim, you know that he would get 735 00:37:01,120 --> 00:37:03,560 Speaker 3: up sometimes today and say, look what I've done. Do 736 00:37:03,600 --> 00:37:08,480 Speaker 3: you think that she's going to be encouraged next Tuesday 737 00:37:08,480 --> 00:37:09,640 Speaker 3: to come out and sort of say, well, you know, 738 00:37:09,640 --> 00:37:11,719 Speaker 3: we'll look. Hang on a minute, hold your horses. I'm 739 00:37:11,760 --> 00:37:15,080 Speaker 3: not sure how sustainable this is because you know, unless 740 00:37:15,120 --> 00:37:18,239 Speaker 3: you're going to continually lock in the rebates for the 741 00:37:18,239 --> 00:37:21,040 Speaker 3: next five years, which they can't afford to do. And 742 00:37:21,080 --> 00:37:25,400 Speaker 3: by the way, Queensland was a big contribute to this 743 00:37:25,520 --> 00:37:26,640 Speaker 3: because they they. 744 00:37:26,640 --> 00:37:31,720 Speaker 1: Were a thousand thousand dollars reason and transport fairs. 745 00:37:31,840 --> 00:37:34,840 Speaker 3: So I don't know what the christ of Fooley is 746 00:37:34,880 --> 00:37:36,800 Speaker 3: going to do, but i'd imagine it wouldn't be reckless 747 00:37:36,880 --> 00:37:40,440 Speaker 3: enough to keep their going because that's not maintained like that, 748 00:37:41,000 --> 00:37:41,760 Speaker 3: it's not going to happen. 749 00:37:42,040 --> 00:37:44,880 Speaker 1: Yeah, So do you think that's going to be a 750 00:37:44,880 --> 00:37:45,360 Speaker 1: big point. 751 00:37:45,200 --> 00:37:48,280 Speaker 2: For She'll try to host down some of this optimism 752 00:37:48,280 --> 00:37:50,399 Speaker 2: on the headline, but there's no doubt and she'll be 753 00:37:51,680 --> 00:37:54,440 Speaker 2: a bit more measured than perhaps you and I, but 754 00:37:54,600 --> 00:37:56,719 Speaker 2: she still must acknowledge that this is this is a 755 00:37:56,760 --> 00:38:00,799 Speaker 2: good right direction and for inflation expectations. In the last 756 00:38:00,880 --> 00:38:04,480 Speaker 2: six months, Sarah Hunter, who's the Assistant Governor Head of 757 00:38:04,520 --> 00:38:08,600 Speaker 2: Economics Economic Research in the RBA and others have spoken 758 00:38:08,600 --> 00:38:12,400 Speaker 2: about inflation expectations. They don't want them to rock at ahead. 759 00:38:12,680 --> 00:38:17,279 Speaker 2: The fact now that we can say factually, inflation is 760 00:38:17,360 --> 00:38:20,759 Speaker 2: two point one percent in the year to September. And 761 00:38:20,840 --> 00:38:23,600 Speaker 2: people perhaps are noticing the electricity bill. Oh, the seventy 762 00:38:23,600 --> 00:38:24,840 Speaker 2: five bucks came off, wasn't that not? 763 00:38:24,960 --> 00:38:25,799 Speaker 1: Well, what's the weight on that? 764 00:38:25,880 --> 00:38:30,000 Speaker 2: Soly electricity is a waiting of about three percentage points. Wow, 765 00:38:30,440 --> 00:38:33,960 Speaker 2: So we spent three percent of spenditure on electricity. The 766 00:38:33,960 --> 00:38:36,080 Speaker 2: price is fell twenty five percent, So the top of 767 00:38:36,120 --> 00:38:39,200 Speaker 2: the head it's about over the year, it's about a 768 00:38:39,320 --> 00:38:40,160 Speaker 2: zero point seven. 769 00:38:40,920 --> 00:38:43,839 Speaker 1: It's a big chunce. Just from that, it's a big chunk. 770 00:38:44,200 --> 00:38:44,839 Speaker 2: It's a big chunk. 771 00:38:44,880 --> 00:38:47,760 Speaker 1: So if we had the point seven onto the headline rate. 772 00:38:47,840 --> 00:38:51,279 Speaker 2: On the headline rate for the annual figure, we get 773 00:38:51,320 --> 00:38:53,200 Speaker 2: the trending rate, which is from two point eight to 774 00:38:53,200 --> 00:38:58,520 Speaker 2: the Yes, there we go, Vuilla, we've discovered the magic source. 775 00:38:58,920 --> 00:39:01,560 Speaker 1: And because the payments, the payment now just recruit me 776 00:39:01,600 --> 00:39:04,040 Speaker 1: if I'm wrong, the payments made us once off or 777 00:39:04,120 --> 00:39:05,399 Speaker 1: is it. 778 00:39:04,800 --> 00:39:06,400 Speaker 2: It's seventy five dollars per. 779 00:39:06,280 --> 00:39:10,440 Speaker 3: Course recording, So that'll maintain itself right through for three 780 00:39:10,480 --> 00:39:12,000 Speaker 3: months next three quarter. 781 00:39:12,480 --> 00:39:15,799 Speaker 2: And there's this debate going on will they extend it 782 00:39:16,120 --> 00:39:19,120 Speaker 2: beyond that period, because again, when it comes off, you'll 783 00:39:19,120 --> 00:39:23,399 Speaker 2: get the headline inflation jumping point seven add adding point 784 00:39:23,440 --> 00:39:24,000 Speaker 2: seven points. 785 00:39:24,200 --> 00:39:27,160 Speaker 3: So really what it means is then you know, if 786 00:39:27,160 --> 00:39:29,440 Speaker 3: I'm just to interpret this without laboring it too much, 787 00:39:29,480 --> 00:39:33,400 Speaker 3: but she might want to say she might be looking 788 00:39:33,480 --> 00:39:38,479 Speaker 3: for a further point seven reduction in the headline rate 789 00:39:39,360 --> 00:39:43,000 Speaker 3: to get the trimmed to account to put us to 790 00:39:43,000 --> 00:39:43,759 Speaker 3: where we want to be. 791 00:39:45,000 --> 00:39:47,879 Speaker 1: Yeah, so that that that's a big call, mate. 792 00:39:47,960 --> 00:39:51,719 Speaker 3: That's it is because the headline is going to be 793 00:39:51,719 --> 00:39:52,720 Speaker 3: one point something. 794 00:39:53,840 --> 00:39:58,920 Speaker 2: It is because unless all the lives in the CPI basket, 795 00:39:59,200 --> 00:40:00,600 Speaker 2: things that still going up that are. 796 00:40:00,520 --> 00:40:02,640 Speaker 1: The problem for example, rents. 797 00:40:02,360 --> 00:40:05,800 Speaker 2: School fees, dwelling rent, insurance premiums, just those there are. 798 00:40:05,719 --> 00:40:08,359 Speaker 1: There are three big ones. 799 00:40:07,160 --> 00:40:11,400 Speaker 2: Three h RBA. Interest rates don't have a huge impact 800 00:40:11,440 --> 00:40:15,320 Speaker 2: on those certain things like insurance and school fees whatever, 801 00:40:15,400 --> 00:40:18,719 Speaker 2: you have to pay it, and they high grade sort 802 00:40:18,719 --> 00:40:20,640 Speaker 2: of to send your kids to a school, they're not 803 00:40:20,640 --> 00:40:22,719 Speaker 2: going to schools are going to drop their fees. So 804 00:40:22,800 --> 00:40:27,080 Speaker 2: in a sense, this is where what measure of inflation 805 00:40:27,280 --> 00:40:30,799 Speaker 2: should we there's a bank be looking at. So the 806 00:40:30,840 --> 00:40:34,520 Speaker 2: trim means fine as far as it goes. Headline is 807 00:40:34,520 --> 00:40:38,040 Speaker 2: obvious because it's what we will pay but is there 808 00:40:38,080 --> 00:40:39,919 Speaker 2: another measure that just gets through to some of these 809 00:40:40,800 --> 00:40:45,080 Speaker 2: what do we call it, government inspired charges and then 810 00:40:45,120 --> 00:40:47,280 Speaker 2: things that are outside it's control. Soy oil price, petrol 811 00:40:47,320 --> 00:40:48,920 Speaker 2: came down, that's nothing to do. 812 00:40:48,880 --> 00:40:53,319 Speaker 1: With it's gonna make up. But it has already gone up. 813 00:40:53,360 --> 00:40:54,480 Speaker 1: It was going up now. 814 00:40:54,520 --> 00:40:57,040 Speaker 2: As we talk here, we are like October. 815 00:40:56,640 --> 00:40:58,799 Speaker 1: Yeah, yeah, and substantially gone up to Yes. 816 00:40:58,880 --> 00:41:01,000 Speaker 2: Yes, I've noticed that too. So again it's one of 817 00:41:01,000 --> 00:41:04,080 Speaker 2: those things that it's set by global conditions, what's happening 818 00:41:04,120 --> 00:41:05,520 Speaker 2: in the Middle East and all that other stuff. It's 819 00:41:05,520 --> 00:41:08,400 Speaker 2: our oil price, not RBA interestraates got to one hundred 820 00:41:08,400 --> 00:41:10,239 Speaker 2: percent or will still be doing what it's doing. It's 821 00:41:10,239 --> 00:41:12,600 Speaker 2: not going to change those sort of things. So there's 822 00:41:12,600 --> 00:41:14,680 Speaker 2: this question that I think the RBA governor will take 823 00:41:14,680 --> 00:41:17,520 Speaker 2: a step back on Tuesday afternoon, which is giving a 824 00:41:17,560 --> 00:41:20,279 Speaker 2: press conference after the Melbourne Cup race, and she'll say, look, 825 00:41:20,440 --> 00:41:24,160 Speaker 2: we are pleased that headline inflation is coming down. We 826 00:41:24,280 --> 00:41:27,080 Speaker 2: probably have more work to do on the trimd mean measure, 827 00:41:27,080 --> 00:41:30,480 Speaker 2: all these underlying measures. We acknowledge that the electricity and 828 00:41:30,520 --> 00:41:35,200 Speaker 2: other subsidies have taken a big chunk off the headline 829 00:41:35,200 --> 00:41:37,839 Speaker 2: figure to make it nice and low, but all we 830 00:41:37,880 --> 00:41:40,600 Speaker 2: want to see all measures, not just headline, but the 831 00:41:40,640 --> 00:41:44,080 Speaker 2: trimmed as well, converging at two and a half percent. 832 00:41:44,200 --> 00:41:46,840 Speaker 2: We're not quite there yet. We know the economy is 833 00:41:46,840 --> 00:41:53,280 Speaker 2: slowing down. We're on hold and we won't rull anything 834 00:41:53,600 --> 00:41:56,359 Speaker 2: out and we'll just see the data for the next 835 00:41:56,440 --> 00:41:59,840 Speaker 2: quarter's inflation number, for the next couple of unemployment numbers, 836 00:41:59,840 --> 00:42:02,680 Speaker 2: and as we said before, what's happening in the global economy, 837 00:42:02,680 --> 00:42:05,480 Speaker 2: including post US election. 838 00:42:06,120 --> 00:42:07,280 Speaker 1: Let's look at the board, mate. 839 00:42:07,200 --> 00:42:09,480 Speaker 2: Let's look at the board. Okay, here's our board. GDP 840 00:42:09,560 --> 00:42:12,000 Speaker 2: growth we know is weak and not really recovering. We're 841 00:42:12,000 --> 00:42:14,440 Speaker 2: not quite at easy, but it's verging on easing, so 842 00:42:14,480 --> 00:42:18,359 Speaker 2: that's important. Inflation was just discussed as adnors. I'm putting 843 00:42:18,400 --> 00:42:20,719 Speaker 2: out in neutral right, not ike, We're not cutting it. 844 00:42:21,360 --> 00:42:22,400 Speaker 2: You'd cut on headline. 845 00:42:23,200 --> 00:42:25,000 Speaker 1: Can we just move a little bit closer to the 846 00:42:25,040 --> 00:42:27,120 Speaker 1: easing the next quarter. 847 00:42:27,480 --> 00:42:30,520 Speaker 2: I'll tell you what mark. If next quarter we confirm 848 00:42:31,200 --> 00:42:35,080 Speaker 2: headlines too and a half ish and the trim means 849 00:42:35,120 --> 00:42:37,560 Speaker 2: down to three point zero, let's assume, so it comes 850 00:42:37,560 --> 00:42:40,600 Speaker 2: off another half percent, I'll move that to the easing side. 851 00:42:41,040 --> 00:42:45,320 Speaker 2: Labor market I'm putting again not quite there because the 852 00:42:45,360 --> 00:42:49,600 Speaker 2: unemployment rates we've discussed all show is low. But I 853 00:42:49,680 --> 00:42:53,920 Speaker 2: think one thing we didn't discuss, job adds, job vacancies, 854 00:42:54,000 --> 00:42:58,120 Speaker 2: the NAB survey of employment intentions are all tracking down. 855 00:42:58,640 --> 00:43:01,320 Speaker 2: Demand for labor is weakening, so I still think the 856 00:43:01,360 --> 00:43:03,200 Speaker 2: unplant rates going up, and if it does, we'll move 857 00:43:03,200 --> 00:43:07,680 Speaker 2: that to easing. But yep, not there. Wages growth same 858 00:43:07,719 --> 00:43:10,239 Speaker 2: as the lake. I've just sort of hate to have 859 00:43:10,280 --> 00:43:12,359 Speaker 2: one for either side of the fence. But you know, again, 860 00:43:12,440 --> 00:43:15,560 Speaker 2: wages growth is decelerating, as we mentioned on that seek measure, 861 00:43:15,560 --> 00:43:18,560 Speaker 2: and even the Bureau of Statistics in National comic easy 862 00:43:19,120 --> 00:43:21,600 Speaker 2: everyone's cutting into straights, that's an easy one everyone but 863 00:43:21,760 --> 00:43:25,560 Speaker 2: us house price they're slowing down for the city's about 864 00:43:25,640 --> 00:43:28,920 Speaker 2: to turn slightly negative, I believe from numbers, So I'm 865 00:43:28,920 --> 00:43:29,920 Speaker 2: putting that in neutral. 866 00:43:30,160 --> 00:43:31,719 Speaker 1: You know that's the first time by the way. 867 00:43:31,840 --> 00:43:35,320 Speaker 2: Yep, Melbourne's week and the smaller cities such as Canberra, 868 00:43:35,680 --> 00:43:39,160 Speaker 2: Darwin and Hobart they're actually falling as well. Adelaide, Brisbane 869 00:43:39,160 --> 00:43:41,239 Speaker 2: and Perth is still very strong, but the rate of 870 00:43:41,280 --> 00:43:43,760 Speaker 2: increase is slowing down. There's a bit of a calling 871 00:43:43,760 --> 00:43:45,000 Speaker 2: in housing so that's an. 872 00:43:44,880 --> 00:43:47,799 Speaker 3: Interesting well a real state agent of one and real 873 00:43:47,880 --> 00:43:50,840 Speaker 3: est state agentleman today from Sydney that is now is 874 00:43:50,920 --> 00:43:52,080 Speaker 3: now turned to a buias market. 875 00:43:52,440 --> 00:43:55,359 Speaker 2: Right there we go. Having the auction clan's rate last 876 00:43:55,360 --> 00:43:59,640 Speaker 2: weekend I think was quite low, very lowly read our 877 00:43:59,680 --> 00:44:02,359 Speaker 2: sales easing. We consumers are still not spending yet, even 878 00:44:02,400 --> 00:44:05,720 Speaker 2: though we've got a little bit more up turning consumers sentiment, 879 00:44:05,719 --> 00:44:08,839 Speaker 2: it's we're still pessimistic on average. It's come off a 880 00:44:08,960 --> 00:44:11,120 Speaker 2: very very low base. So you come from the wooden 881 00:44:11,120 --> 00:44:14,080 Speaker 2: spoon on consumer sentiment to now be third last. If 882 00:44:14,080 --> 00:44:16,319 Speaker 2: we use a footy analogy, we're not yet on the 883 00:44:16,360 --> 00:44:17,960 Speaker 2: fringe of the eight. I'll move that to neutral when 884 00:44:18,000 --> 00:44:22,600 Speaker 2: we get there. Building approvals. Oh, that perennially week, that 885 00:44:22,719 --> 00:44:24,480 Speaker 2: housing debate, I think that's going to be one of 886 00:44:24,480 --> 00:44:27,279 Speaker 2: the election discussions, has to be. Both sides are talking 887 00:44:27,360 --> 00:44:29,680 Speaker 2: about it. Hooray in a way. And you know what 888 00:44:30,200 --> 00:44:35,840 Speaker 2: the coalition rollout of infrastructure funding for roads and guttering 889 00:44:35,960 --> 00:44:38,680 Speaker 2: and sewerage and water and electricity. Great, but then we 890 00:44:38,680 --> 00:44:40,840 Speaker 2: also need to build more houses and we need to 891 00:44:40,840 --> 00:44:42,520 Speaker 2: build them in a city as well. So that's what 892 00:44:42,600 --> 00:44:45,640 Speaker 2: Labour's doing so in a funny way, I think we've 893 00:44:45,640 --> 00:44:49,240 Speaker 2: almost got If you could cherry pick what the libs 894 00:44:49,239 --> 00:44:50,960 Speaker 2: are saying and cherry pick what labor's saying, you might 895 00:44:50,960 --> 00:44:53,359 Speaker 2: actually get a solution to this problem. But we'll see 896 00:44:53,360 --> 00:44:57,400 Speaker 2: what happens there. Business investments, Okay, that's neutral. It's fine. 897 00:44:57,440 --> 00:45:01,360 Speaker 2: It's not a problem. It's not great business confidence. It's 898 00:45:01,400 --> 00:45:04,960 Speaker 2: starting to turn a little bit weaker, not catastrophic. It 899 00:45:05,320 --> 00:45:09,680 Speaker 2: commodities you mentioned all price, very volatile, just neutral. You know, 900 00:45:09,719 --> 00:45:11,839 Speaker 2: we don't have a collapse in commodity prices, iron ore, 901 00:45:12,239 --> 00:45:14,839 Speaker 2: which did for got a boost when the Chinese cut 902 00:45:14,840 --> 00:45:19,040 Speaker 2: into straight. So it's back to neutral. Stock markets booming unbelievable. 903 00:45:19,080 --> 00:45:20,480 Speaker 2: Now they're not going to hike, but I'll put that 904 00:45:20,520 --> 00:45:23,560 Speaker 2: in neutral. And current rates are restrictive, so I'm moving 905 00:45:23,560 --> 00:45:25,960 Speaker 2: that to the easing side. So you can see here 906 00:45:26,719 --> 00:45:29,200 Speaker 2: there's quite a few in the easing cycle, still a 907 00:45:29,280 --> 00:45:31,080 Speaker 2: few not quite there. 908 00:45:31,120 --> 00:45:34,120 Speaker 1: You know, the three big guys, and this is. 909 00:45:34,040 --> 00:45:35,719 Speaker 2: The this is the stuff that has the higher weight, 910 00:45:35,760 --> 00:45:38,880 Speaker 2: and we discussed that in the past. These GDP inflation, 911 00:45:39,080 --> 00:45:41,279 Speaker 2: labor market wags, they're the things that matter most to 912 00:45:41,320 --> 00:45:42,000 Speaker 2: the RBA. 913 00:45:42,000 --> 00:45:44,600 Speaker 3: Because of something is currently sitting in the using column. 914 00:45:44,640 --> 00:45:46,160 Speaker 3: They all feed into the top guys. 915 00:45:46,280 --> 00:45:49,359 Speaker 2: They feed in with a one or two quarter lag. 916 00:45:49,400 --> 00:45:51,879 Speaker 1: Yeah, yeah, with a lag, yes, correct, So. 917 00:45:53,440 --> 00:45:59,000 Speaker 3: Feedless predictions November Melbourne Cup day rate reduction, rate, stay, 918 00:45:59,160 --> 00:46:03,120 Speaker 3: rate increase, no change, no change, and the second next 919 00:46:03,160 --> 00:46:05,200 Speaker 3: felis prediction. Of course, we can't see the money markets 920 00:46:05,200 --> 00:46:07,279 Speaker 3: at the moment because they wouldn't have actually hadn't enough 921 00:46:07,280 --> 00:46:08,759 Speaker 3: time to work on it. I mean, you can get 922 00:46:08,760 --> 00:46:11,160 Speaker 3: a number, but it won't be sort of full enough. 923 00:46:11,719 --> 00:46:13,040 Speaker 2: Yeah, I was just gonna have a very quick look, 924 00:46:13,040 --> 00:46:14,680 Speaker 2: if you don't mind, just say what the bond market's done. 925 00:46:14,680 --> 00:46:18,880 Speaker 2: If that's okay, A very little changed. I think the 926 00:46:18,880 --> 00:46:23,000 Speaker 2: bond markets are acting like we have headline figure that's great, trimmed, 927 00:46:23,000 --> 00:46:25,759 Speaker 2: remain a bit high. So we're sitting here with the 928 00:46:26,040 --> 00:46:28,200 Speaker 2: three year bond just under four percent compared with the 929 00:46:28,239 --> 00:46:30,120 Speaker 2: official cash rate of four point. 930 00:46:29,920 --> 00:46:32,960 Speaker 1: Three five, which basically says no real movement. 931 00:46:33,360 --> 00:46:36,080 Speaker 2: No. So there's a couple of rate cuts over the 932 00:46:36,080 --> 00:46:37,040 Speaker 2: course of a couple of years. 933 00:46:37,160 --> 00:46:40,160 Speaker 3: Yeah, broadly nothing, or there's one rate cut and a 934 00:46:40,200 --> 00:46:43,160 Speaker 3: bit of a rate cut point three to five. 935 00:46:43,480 --> 00:46:44,560 Speaker 1: So that's interesting. 936 00:46:44,600 --> 00:46:49,040 Speaker 3: So and so Feeler's predictions because you know we've got 937 00:46:49,160 --> 00:46:50,759 Speaker 3: twenty twenty five coming up. 938 00:46:51,440 --> 00:46:52,080 Speaker 1: What do you reckon? 939 00:46:52,600 --> 00:46:55,040 Speaker 2: Look, I think that once we get into twenty twenty five, 940 00:46:56,360 --> 00:47:01,080 Speaker 2: we'll see the RBA joining the global party interstrates because 941 00:47:01,400 --> 00:47:04,279 Speaker 2: we will have inflation trim mean headline however you want 942 00:47:04,280 --> 00:47:07,359 Speaker 2: to measure in the zone. We'll have the unplant rate 943 00:47:07,360 --> 00:47:10,040 Speaker 2: a little bit higher, and we'll have confirmation even though 944 00:47:10,080 --> 00:47:12,359 Speaker 2: the economy is probably a little bit better than it 945 00:47:12,440 --> 00:47:15,719 Speaker 2: is now, will still not be booming. It won't be 946 00:47:15,760 --> 00:47:19,920 Speaker 2: that sort of growth momentum. So we'll see a couple 947 00:47:19,920 --> 00:47:22,240 Speaker 2: of rate cuts I think through through the twenty twenty 948 00:47:22,239 --> 00:47:26,000 Speaker 2: five twenty twenty five not aggressive, and again don't get excited. 949 00:47:26,000 --> 00:47:28,640 Speaker 2: We are not going back to interestrates were during the pandemic. 950 00:47:29,040 --> 00:47:32,000 Speaker 2: We are talking I think a minimum of fifty because 951 00:47:32,000 --> 00:47:33,719 Speaker 2: they've got it. They can't just go to one to 952 00:47:33,800 --> 00:47:36,280 Speaker 2: twenty five. That won't have any effects. Minimum of fifty 953 00:47:37,320 --> 00:47:40,000 Speaker 2: probably up to one hundred points of rate cuts, so 954 00:47:40,000 --> 00:47:42,360 Speaker 2: the cashot goes to three point three to five. And 955 00:47:42,400 --> 00:47:43,799 Speaker 2: if we get a little bit of bad news on 956 00:47:43,840 --> 00:47:47,120 Speaker 2: the economy or something happens in the US, we might 957 00:47:47,120 --> 00:47:49,680 Speaker 2: cut a little bit more than that, but that requires 958 00:47:50,120 --> 00:47:52,200 Speaker 2: a factor out of left field to come and push 959 00:47:53,280 --> 00:47:54,880 Speaker 2: or force the hand of the RBA lower. 960 00:47:55,080 --> 00:47:59,279 Speaker 3: It's interesting, you know, if they start to reduce rates, 961 00:47:59,280 --> 00:48:04,560 Speaker 3: and see every March next year, it's around seven months 962 00:48:04,719 --> 00:48:08,680 Speaker 3: later than all the other countries started reducing interest rates, 963 00:48:08,680 --> 00:48:09,040 Speaker 3: which is. 964 00:48:09,000 --> 00:48:11,879 Speaker 1: Equivalent to when we started to put rates up. 965 00:48:12,080 --> 00:48:16,480 Speaker 3: So we put race up around seven months later May. 966 00:48:16,800 --> 00:48:19,520 Speaker 2: The first ones were hiking in late twenty one. 967 00:48:19,600 --> 00:48:23,400 Speaker 3: Yes, around seven eight months, And it's sort of nearly 968 00:48:23,480 --> 00:48:28,520 Speaker 3: like patternized clockwork, like we're just we just were a 969 00:48:28,560 --> 00:48:31,239 Speaker 3: bit slow to put them up, and we're going to 970 00:48:31,280 --> 00:48:32,439 Speaker 3: be a bit slow to put them down. 971 00:48:32,640 --> 00:48:34,160 Speaker 2: I think that that might be a fair sense in 972 00:48:34,200 --> 00:48:36,320 Speaker 2: a very simple way. No, No, that's a fair assessment 973 00:48:36,360 --> 00:48:37,160 Speaker 2: in the Reserve Bank. 974 00:48:37,480 --> 00:48:39,440 Speaker 1: So our economy has behaved appropriately. 975 00:48:39,480 --> 00:48:42,080 Speaker 3: So because you know, like in a scientific sense, like 976 00:48:42,280 --> 00:48:47,280 Speaker 3: in an economics as a science, things tend to behave 977 00:48:47,320 --> 00:48:50,120 Speaker 3: the same, you know. It's just like all scientific experiments, 978 00:48:50,360 --> 00:48:52,479 Speaker 3: they tend to behave the same unless you're doing something 979 00:48:52,560 --> 00:48:53,920 Speaker 3: radically different, which we haven't. 980 00:48:54,360 --> 00:48:57,000 Speaker 1: We haven't any different, correct, We've done what in. 981 00:48:56,960 --> 00:49:00,239 Speaker 3: The experiment, like our scientific experiment with our economy, which 982 00:49:00,280 --> 00:49:03,800 Speaker 3: is what everyone does, has been We've had some small differences, 983 00:49:03,800 --> 00:49:07,880 Speaker 3: but nothing radical. And it looks like we are like everything, 984 00:49:08,080 --> 00:49:12,200 Speaker 3: like every scientific experiment, but in an economic sense, we're 985 00:49:12,239 --> 00:49:15,240 Speaker 3: going to be as we are, as predictable in our behavior, 986 00:49:15,280 --> 00:49:17,879 Speaker 3: the economic behavior as everybody else. 987 00:49:19,920 --> 00:49:20,680 Speaker 1: It seems that way. 988 00:49:21,120 --> 00:49:23,880 Speaker 2: It seems that way in the West western world, where 989 00:49:24,200 --> 00:49:26,759 Speaker 2: consumers are the dominant part of each economy, whether you're 990 00:49:26,760 --> 00:49:29,520 Speaker 2: looking at the UK, the US, Germany. Yeah, there's slight 991 00:49:29,520 --> 00:49:33,080 Speaker 2: differences from country to country, but household consumption houseold spinning 992 00:49:33,120 --> 00:49:35,879 Speaker 2: is the line's share of GDP growth. When we face 993 00:49:35,960 --> 00:49:40,800 Speaker 2: financial pressure, we consumers are not silly. We cut our spending. Happened, 994 00:49:40,960 --> 00:49:43,759 Speaker 2: It's happening everywhere. So that financial pressure was through the 995 00:49:43,800 --> 00:49:45,799 Speaker 2: cost of living when inflation went up and oh my god, 996 00:49:45,800 --> 00:49:48,799 Speaker 2: the price of everything's gone up so much, or into 997 00:49:48,800 --> 00:49:49,480 Speaker 2: straight hikes. 998 00:49:49,560 --> 00:49:50,719 Speaker 1: We're both or both. 999 00:49:50,840 --> 00:49:54,040 Speaker 2: We had both in Australia, well both everywhere in the world, frankly, 1000 00:49:54,840 --> 00:49:57,279 Speaker 2: and now we respond to it. Some people respond a 1001 00:49:57,280 --> 00:49:59,239 Speaker 2: bit more quickly, a bit more slowly, but we're part 1002 00:49:59,280 --> 00:50:00,600 Speaker 2: of that response to and. 1003 00:50:00,560 --> 00:50:05,480 Speaker 3: So it's it's sort of nearly I mean, I know 1004 00:50:05,560 --> 00:50:09,200 Speaker 3: we're going to I don't want to discount the analysis 1005 00:50:09,200 --> 00:50:12,000 Speaker 3: that we do and that everyone else does around the world. 1006 00:50:12,880 --> 00:50:17,120 Speaker 3: But it's nearly like it's just common sense that we 1007 00:50:17,200 --> 00:50:23,239 Speaker 3: will behave predictably like everybody else if most of the 1008 00:50:23,920 --> 00:50:27,440 Speaker 3: inputs are constant, in which our case it is. 1009 00:50:28,280 --> 00:50:31,560 Speaker 2: And this is probably a topic for another day, but 1010 00:50:32,120 --> 00:50:36,399 Speaker 2: globalization we are part of them much more with the case. Yes, 1011 00:50:36,560 --> 00:50:38,359 Speaker 2: so that we mentioned the price of all, but it's 1012 00:50:38,360 --> 00:50:41,279 Speaker 2: also the price of iPhones, the price of TV, is 1013 00:50:41,320 --> 00:50:44,080 Speaker 2: the price of cars that are made in Netflix, everything, 1014 00:50:44,200 --> 00:50:46,319 Speaker 2: price of car, maid and career if you drive it 1015 00:50:46,360 --> 00:50:49,760 Speaker 2: in London or in the US or in Australia. Okay, 1016 00:50:49,760 --> 00:50:51,799 Speaker 2: there's tariffs and a few other bits and bobs that there, 1017 00:50:51,840 --> 00:50:53,960 Speaker 2: but it's basically the same price. If the price of 1018 00:50:54,000 --> 00:50:57,320 Speaker 2: a car went up fifty percent, for example, because the 1019 00:50:57,360 --> 00:51:01,080 Speaker 2: crean producers put up everyone would be confronting that the 1020 00:51:01,080 --> 00:51:03,239 Speaker 2: price of all goes up because of a conflict in 1021 00:51:03,239 --> 00:51:05,600 Speaker 2: the Middle East. We all pay that. So the globalization 1022 00:51:05,719 --> 00:51:08,480 Speaker 2: means that while our economies are different, Yes, there's different. 1023 00:51:08,480 --> 00:51:11,840 Speaker 2: We've got lots of mining and the UK doesn't have 1024 00:51:11,920 --> 00:51:15,759 Speaker 2: much money, you know, we've got a different structure. But broadly, 1025 00:51:16,360 --> 00:51:19,399 Speaker 2: very broadly, and from US consumers and consumers in the 1026 00:51:19,520 --> 00:51:25,480 Speaker 2: UK and in the US we react remarkably similarly to 1027 00:51:25,760 --> 00:51:28,279 Speaker 2: all of these things. And that's why Oh gosh, I 1028 00:51:28,280 --> 00:51:31,040 Speaker 2: wish I, which had a chart with me. It showed 1029 00:51:31,040 --> 00:51:33,320 Speaker 2: that in the raid hiking cycle, again the timing was 1030 00:51:33,320 --> 00:51:35,359 Speaker 2: a little bit different and the orders of hikes were 1031 00:51:35,360 --> 00:51:38,080 Speaker 2: a little bit different. But there's this wonderful colors and 1032 00:51:38,120 --> 00:51:40,200 Speaker 2: I think seven or eight countries, they all went up 1033 00:51:40,239 --> 00:51:44,239 Speaker 2: pretty much together, they all stabilize pretty much together. They're 1034 00:51:44,280 --> 00:51:46,440 Speaker 2: starting to come down a little bit, except us, they're 1035 00:51:46,440 --> 00:51:48,120 Speaker 2: starting to come down a little bit. And so when 1036 00:51:48,120 --> 00:51:50,600 Speaker 2: we see this charting his time, for example, all these 1037 00:51:50,680 --> 00:51:52,839 Speaker 2: yellow line for the US, red line for the UK, 1038 00:51:53,320 --> 00:51:56,040 Speaker 2: purple line for Australia, they'll all be coming down now. 1039 00:51:56,040 --> 00:51:57,640 Speaker 2: Someone will be down at three, some will be three 1040 00:51:57,680 --> 00:52:00,000 Speaker 2: and a half, some will be two. There'll be different. 1041 00:52:00,560 --> 00:52:03,320 Speaker 2: But if you just eyeball the chart, which I love doing, 1042 00:52:03,800 --> 00:52:09,760 Speaker 2: you'll see everyone's confronting low inflation. We could growth inflation 1043 00:52:09,840 --> 00:52:12,200 Speaker 2: hitting people's targets. So whether that's the FED in the US, 1044 00:52:12,320 --> 00:52:15,680 Speaker 2: or Bank of England or the Reserve Bank of Australia, yep, 1045 00:52:15,719 --> 00:52:16,840 Speaker 2: we can trim rates a bit. 1046 00:52:16,920 --> 00:52:19,279 Speaker 3: Because you know what consumers can take away from by 1047 00:52:19,280 --> 00:52:20,840 Speaker 3: the way, I do want to take ourselves out of 1048 00:52:20,840 --> 00:52:23,200 Speaker 3: a job. But what consumers can take out of this is, 1049 00:52:23,640 --> 00:52:26,280 Speaker 3: as you just said, pretty much. 1050 00:52:26,320 --> 00:52:27,080 Speaker 1: We're all the same. 1051 00:52:27,160 --> 00:52:31,640 Speaker 3: Like most of the countries adopt to two percent inflation 1052 00:52:31,719 --> 00:52:35,680 Speaker 3: number or somewhere between two and three, between. 1053 00:52:35,360 --> 00:52:36,880 Speaker 1: Two and three, but a lot of them actually was 1054 00:52:36,960 --> 00:52:39,160 Speaker 1: dead on two. We're all pretty much the same, you. 1055 00:52:39,160 --> 00:52:41,920 Speaker 2: Know, we're two and a half, others are two. Some 1056 00:52:42,120 --> 00:52:45,440 Speaker 2: use the personal consumption to flavor. It's basically two to 1057 00:52:45,440 --> 00:52:46,040 Speaker 2: two and a half. 1058 00:52:47,360 --> 00:52:51,560 Speaker 3: And whilst the numbers are different per country, and that 1059 00:52:51,600 --> 00:52:54,120 Speaker 3: actually does have some impact in terms of speed of 1060 00:52:54,200 --> 00:52:57,759 Speaker 3: which change can occur, because the momentum can create a 1061 00:52:57,800 --> 00:53:01,560 Speaker 3: bigger speed, a faster speed. Australia just pretty much follows 1062 00:53:01,920 --> 00:53:04,960 Speaker 3: behavior of everybody else as not trying to take your 1063 00:53:05,000 --> 00:53:08,640 Speaker 3: job way or our podcast way. But it sort of 1064 00:53:08,640 --> 00:53:15,280 Speaker 3: seems that way, and globalization has helped that or totally 1065 00:53:15,400 --> 00:53:17,360 Speaker 3: and it continues to do more than has ever done before. 1066 00:53:17,800 --> 00:53:20,279 Speaker 2: Correct and as time goes on, it's going to be 1067 00:53:20,400 --> 00:53:25,040 Speaker 2: much more, much more close. And even international airfares, you know, 1068 00:53:25,320 --> 00:53:27,480 Speaker 2: they're the same. There's no arbitrage whether you book a 1069 00:53:27,520 --> 00:53:31,520 Speaker 2: flight from city to London and back to Sydney in London, 1070 00:53:31,600 --> 00:53:32,279 Speaker 2: or you do it here, it's. 1071 00:53:32,200 --> 00:53:35,719 Speaker 1: The same price arbitrary, but you can't. 1072 00:53:35,719 --> 00:53:36,960 Speaker 2: Now the airlines are smart. 1073 00:53:37,960 --> 00:53:40,319 Speaker 1: They've got around that. 1074 00:53:40,520 --> 00:53:44,200 Speaker 3: Everybody where we could sort of make we could sort 1075 00:53:44,200 --> 00:53:45,400 Speaker 3: of play differences. 1076 00:53:45,440 --> 00:53:47,120 Speaker 1: They've worked out the arbitrage. It's a bit like trying 1077 00:53:47,160 --> 00:53:47,800 Speaker 1: to beat the casino. 1078 00:53:48,200 --> 00:53:52,080 Speaker 3: The global the global economy has worked out all the 1079 00:53:52,080 --> 00:53:55,960 Speaker 3: tricks and everything's really much more smooth smooth out. 1080 00:53:56,239 --> 00:53:58,000 Speaker 2: The only thing that can make it change a lot 1081 00:53:58,080 --> 00:54:00,680 Speaker 2: is if your currency beat the euro. The end, the 1082 00:54:00,680 --> 00:54:04,920 Speaker 2: British pound or the Aussie dollar does a big gyration. 1083 00:54:04,600 --> 00:54:05,960 Speaker 1: For some reason or another, but it have to be 1084 00:54:06,000 --> 00:54:07,400 Speaker 1: an extrain, and it has to. 1085 00:54:07,400 --> 00:54:09,600 Speaker 2: Be a really big move just in the Aussie dollar 1086 00:54:09,719 --> 00:54:10,680 Speaker 2: or just in the British pounds. 1087 00:54:10,680 --> 00:54:14,319 Speaker 3: That has to be exogenous because we're all trading with 1088 00:54:14,400 --> 00:54:16,399 Speaker 3: each other, and the things that sort of tend to 1089 00:54:16,480 --> 00:54:19,880 Speaker 3: change the dollar could be interest rates or could be 1090 00:54:19,920 --> 00:54:23,320 Speaker 3: commodity prices in our case, but because it's a global number, 1091 00:54:24,120 --> 00:54:27,320 Speaker 3: it's not moving around too much, and so it seems 1092 00:54:27,360 --> 00:54:29,719 Speaker 3: to be like we know the rest of the world 1093 00:54:29,800 --> 00:54:32,440 Speaker 3: is going to be all the same same, just timing 1094 00:54:32,480 --> 00:54:33,040 Speaker 3: will be different. 1095 00:54:33,040 --> 00:54:35,440 Speaker 2: It's timing and slide orders to mag yeah, put it 1096 00:54:35,520 --> 00:54:37,200 Speaker 2: this way, direction will be We're all going in the 1097 00:54:37,239 --> 00:54:39,640 Speaker 2: same direction. It's just no matter who's a bit faster 1098 00:54:40,239 --> 00:54:42,439 Speaker 2: and who starts a bit earlier, who ends a bit later. 1099 00:54:42,960 --> 00:54:43,960 Speaker 1: We're talking about well couldie. 1100 00:54:43,960 --> 00:54:47,360 Speaker 3: That's great because we can actually take comfort right now anyways, 1101 00:54:47,680 --> 00:54:49,960 Speaker 3: as you and I sit here that the world is 1102 00:54:50,000 --> 00:54:53,440 Speaker 3: heading in the right globally, the countries that we can 1103 00:54:53,560 --> 00:54:56,520 Speaker 3: be comparative with are heading in the right direction for 1104 00:54:56,600 --> 00:54:58,719 Speaker 3: us to get an interest rate reduction. And how many 1105 00:54:58,880 --> 00:55:01,840 Speaker 3: is a different matter, but isray productions some stage in 1106 00:55:02,360 --> 00:55:05,160 Speaker 3: the near future, not to distant future. 1107 00:55:05,400 --> 00:55:09,520 Speaker 2: And the interesting thing is that the Reserve Bank will 1108 00:55:09,560 --> 00:55:13,680 Speaker 2: acknowledge that they haven't yet, they might next week, and 1109 00:55:13,680 --> 00:55:15,600 Speaker 2: if they don't next week, they will in the December meeting. 1110 00:55:15,680 --> 00:55:18,680 Speaker 2: So we're almost there, and you'll hear a cigh of 1111 00:55:18,800 --> 00:55:22,200 Speaker 2: relief around mortgage holders and small business for that matter, 1112 00:55:22,239 --> 00:55:25,600 Speaker 2: who have overdrafts that it might not be today, but 1113 00:55:25,680 --> 00:55:26,920 Speaker 2: we can see some light at the end of the 1114 00:55:26,960 --> 00:55:28,839 Speaker 2: tunnel in terms of the rate cuts coming through. 1115 00:55:29,480 --> 00:55:30,759 Speaker 1: Do we have a December meeting This. 1116 00:55:30,880 --> 00:55:34,359 Speaker 2: December meeting year, so November there's sort of this funny one. 1117 00:55:34,360 --> 00:55:36,040 Speaker 2: They get one way out before the end of the year, 1118 00:55:36,040 --> 00:55:37,880 Speaker 2: and then they don't meet again. So there's still no 1119 00:55:37,960 --> 00:55:41,200 Speaker 2: January meeting. And I remember correctly, I think it's the 1120 00:55:41,200 --> 00:55:43,880 Speaker 2: sixth of February. So there's one about the ninth or 1121 00:55:43,960 --> 00:55:46,040 Speaker 2: tenth of December, if I remember correctly, and then there's 1122 00:55:46,040 --> 00:55:46,759 Speaker 2: another one on the. 1123 00:55:47,640 --> 00:55:48,600 Speaker 1: And finally February. 1124 00:55:48,640 --> 00:55:51,400 Speaker 3: And finally, do you think the Rooser Bank governor is 1125 00:55:51,440 --> 00:55:54,800 Speaker 3: going to publish the vote of all the members? 1126 00:55:55,360 --> 00:55:57,920 Speaker 2: She said you might. I would find that very very 1127 00:55:58,000 --> 00:56:01,160 Speaker 2: interesting to see who. 1128 00:56:01,960 --> 00:56:04,399 Speaker 1: Who's DubVision, who is bullish, and who's got. 1129 00:56:04,320 --> 00:56:07,319 Speaker 2: A different view, because again, like we're discussing, we know 1130 00:56:07,360 --> 00:56:09,880 Speaker 2: without the US does Yeah, they do publish it, and 1131 00:56:10,000 --> 00:56:13,120 Speaker 2: so it's the UK and as we have here. Okay, 1132 00:56:13,120 --> 00:56:15,400 Speaker 2: we're not RBA members unfortunately, but you know, a Warren 1133 00:56:15,480 --> 00:56:18,000 Speaker 2: Hogan or a Christopher Joy or a me or a 1134 00:56:18,040 --> 00:56:20,720 Speaker 2: Shane Oliver or you know, we have different views on interests. 1135 00:56:20,760 --> 00:56:22,480 Speaker 2: We look at the same data, you know, look at 1136 00:56:22,480 --> 00:56:26,000 Speaker 2: pretty much and have a different judgment. The nine members 1137 00:56:26,040 --> 00:56:28,960 Speaker 2: of the RBA Board do the same thing. They think, 1138 00:56:29,000 --> 00:56:31,320 Speaker 2: oh gee, I think you know we're overstating the importance 1139 00:56:31,320 --> 00:56:34,640 Speaker 2: of this or understating the importance of that. And that's 1140 00:56:34,680 --> 00:56:36,840 Speaker 2: where the healthy debate comes in. I think a conflict 1141 00:56:36,840 --> 00:56:39,520 Speaker 2: if everyone's one hundred percent in agreement, it's very boring. 1142 00:56:40,280 --> 00:56:42,640 Speaker 2: If someone challenges you and say, hey, Mark, I reckon 1143 00:56:42,640 --> 00:56:45,560 Speaker 2: we're going to high grades. Oh why are you saying that? Mate, 1144 00:56:46,239 --> 00:56:49,200 Speaker 2: and you have a debate that hopefully leads to a 1145 00:56:49,239 --> 00:56:49,840 Speaker 2: better outcome. 1146 00:56:50,400 --> 00:56:53,000 Speaker 3: Well, when they're all sitting around next Tuesday having a 1147 00:56:53,040 --> 00:56:57,000 Speaker 3: cup between Lamington's and holding hands as singing Kumbai R, 1148 00:56:58,160 --> 00:57:04,480 Speaker 3: I'll guarantee that they will take this segment of our 1149 00:57:04,520 --> 00:57:07,279 Speaker 3: discussion with your board and they'll place it up on 1150 00:57:07,320 --> 00:57:11,000 Speaker 3: their big screen and they'll say as the word Cocolors 1151 00:57:11,000 --> 00:57:13,680 Speaker 3: and Boris have put together, and no doubt they'll be 1152 00:57:13,719 --> 00:57:14,640 Speaker 3: in totally agree with us. 1153 00:57:14,680 --> 00:57:16,400 Speaker 2: I'm sure they do. We'll have a chat to both 1154 00:57:16,960 --> 00:57:20,040 Speaker 2: Michelle and Andrew Houses's Deputy governor, say guys, pop this up. 1155 00:57:20,120 --> 00:57:21,120 Speaker 2: You don't need any more than that. 1156 00:57:21,320 --> 00:57:21,960 Speaker 1: Good on you, mate. 1157 00:57:22,080 --> 00:57:22,600 Speaker 2: Thanks Mark,