1 00:00:03,870 --> 00:00:06,510 Michael Thompson: This is the weekend edition of Fear and Greed. Australia's 2 00:00:06,510 --> 00:00:09,779 Michael Thompson: most popular business podcast. I'm Michael Thompson and good morning, 3 00:00:09,780 --> 00:00:10,560 Michael Thompson: Sean Aylmer. 4 00:00:11,039 --> 00:00:11,940 Sean Aylmer: Morning, Michael. 5 00:00:12,539 --> 00:00:15,119 Michael Thompson: Sean, our weekend edition is very different to the weekday 6 00:00:15,150 --> 00:00:18,089 Michael Thompson: show. It's the kind of episode that if it wasn't 7 00:00:18,360 --> 00:00:20,549 Michael Thompson: so early in the morning, you could have a glass 8 00:00:20,550 --> 00:00:22,110 Michael Thompson: of wine or a beer or something while you were 9 00:00:22,110 --> 00:00:22,830 Michael Thompson: doing it, couldn't you? 10 00:00:23,370 --> 00:00:26,459 Sean Aylmer: Look, I'd suggest listening to it a second time later in 11 00:00:26,460 --> 00:00:27,000 Sean Aylmer: the day. 12 00:00:27,270 --> 00:00:28,170 Michael Thompson: That's a great idea. 13 00:00:28,500 --> 00:00:34,349 Sean Aylmer: And taking in just how arbitrary the judging from this 14 00:00:34,350 --> 00:00:35,220 Sean Aylmer: show actually is. 15 00:00:35,609 --> 00:00:37,800 Michael Thompson: Because of course this is a competition and we are 16 00:00:37,800 --> 00:00:40,290 Michael Thompson: looking for... You and I each nominating what we think 17 00:00:40,290 --> 00:00:43,380 Michael Thompson: is the biggest story of the week, the most remarkable 18 00:00:43,380 --> 00:00:47,729 Michael Thompson: story, the sleeper story, which is a really hard category for me. 19 00:00:47,729 --> 00:00:49,559 Michael Thompson: It's one that's going to be a bigger story further 20 00:00:49,559 --> 00:00:51,689 Michael Thompson: down the track or something like that. And then our 21 00:00:51,690 --> 00:00:54,960 Michael Thompson: favorite story, and as you say, we do have someone 22 00:00:55,350 --> 00:00:59,790 Michael Thompson: making judgments, making decisions, and that person this week, as 23 00:00:59,790 --> 00:01:02,099 Michael Thompson: always, is our Fear and Greed colleague Adam Lang. Good 24 00:01:02,099 --> 00:01:02,760 Michael Thompson: morning, Adam. 25 00:01:03,000 --> 00:01:04,080 Adam Lang: Good morning, Michael. 26 00:01:04,319 --> 00:01:06,959 Michael Thompson: Can I share with you both a message that we 27 00:01:06,959 --> 00:01:10,559 Michael Thompson: received from a listener through the week? Just before we 28 00:01:10,559 --> 00:01:14,700 Michael Thompson: jump in. And this is a message from Shane via 29 00:01:14,730 --> 00:01:19,199 Michael Thompson: Instagram and he said, " Hello gentlemen, longtime listener, first time 30 00:01:19,200 --> 00:01:22,950 Michael Thompson: messenger to anyone that I listen or watch." So this 31 00:01:22,950 --> 00:01:24,688 Michael Thompson: is the first time he's ever engaged with anyone. 32 00:01:24,690 --> 00:01:25,319 Sean Aylmer: Privileged. 33 00:01:26,789 --> 00:01:29,069 Michael Thompson: He said, " Your MEA campaign must be working." That's our 34 00:01:29,069 --> 00:01:32,580 Michael Thompson: most enthusiastic advocate campaign, he said, " Because..." 35 00:01:32,640 --> 00:01:34,920 Sean Aylmer: Snappy. Very snappy acronym. 36 00:01:35,160 --> 00:01:37,590 Michael Thompson: I know, but unfortunately it's one of those things, once 37 00:01:37,590 --> 00:01:40,230 Michael Thompson: it's been used so many times, we can't change it now. 38 00:01:40,590 --> 00:01:41,340 Sean Aylmer: No, it's stuck. 39 00:01:41,430 --> 00:01:43,590 Michael Thompson: We're stuck with it for life. And he goes, " I really love the 40 00:01:43,590 --> 00:01:47,459 Michael Thompson: weekend edition. And that is why I am messaging." Here 41 00:01:47,459 --> 00:01:52,200 Michael Thompson: we go. He says, " I think Michael is at a 42 00:01:52,200 --> 00:01:53,520 Michael Thompson: distinct disadvantage." 43 00:01:55,080 --> 00:01:55,081 Sean Aylmer: Yes, go on. 44 00:01:55,081 --> 00:01:59,519 Michael Thompson: " Because both Sean and Adam have a similar knowledge background..." 45 00:01:59,910 --> 00:01:59,911 Sean Aylmer: Whack. 46 00:01:59,911 --> 00:02:05,159 Michael Thompson: " And a similar age, and this brings them together. 47 00:02:05,369 --> 00:02:07,920 Michael Thompson: So Michael has to work twice as hard to get 48 00:02:07,920 --> 00:02:11,490 Michael Thompson: a win." So straight away, Shane here has picked out 49 00:02:11,490 --> 00:02:14,040 Michael Thompson: the problem here that there's collusion between the two of you. 50 00:02:14,400 --> 00:02:17,639 Adam Lang: That wasn't actually Shane's word, but carry on. 51 00:02:18,000 --> 00:02:20,070 Michael Thompson: Shane actually has a suggestion here and he says, " My 52 00:02:20,070 --> 00:02:23,038 Michael Thompson: solution is this. Since Michael is the representative of the 53 00:02:23,038 --> 00:02:25,770 Michael Thompson: people..." They are his words. He's the one describing me 54 00:02:25,770 --> 00:02:26,701 Michael Thompson: as the representative of the people, not me. 55 00:02:26,701 --> 00:02:29,730 Adam Lang: He has listened to you say that many times. 56 00:02:29,730 --> 00:02:31,079 Sean Aylmer: He might have heard it once or twice. 57 00:02:31,320 --> 00:02:37,649 Michael Thompson: He said, " Michael should judge," and I disagree with the next 58 00:02:37,650 --> 00:02:39,389 Michael Thompson: part of it. He says, " And the two brains can 59 00:02:39,389 --> 00:02:40,200 Michael Thompson: pick the stories." 60 00:02:40,230 --> 00:02:42,151 Sean Aylmer: Oh, I like that part. I like that. 61 00:02:42,151 --> 00:02:46,290 Michael Thompson: " With their expert knowledge." So, I mean, Shane has given me a sizeable 62 00:02:46,290 --> 00:02:49,410 Michael Thompson: whack along the way here. He's sprinkled some breadcrumbs, like 63 00:02:49,410 --> 00:02:50,550 Michael Thompson: some positivity there in terms of... 64 00:02:51,210 --> 00:02:55,138 Sean Aylmer: To be honest, this is a pro Michael Instagram message, 65 00:02:55,559 --> 00:02:58,440 Sean Aylmer: but I do like the fact that he has highlighted 66 00:02:58,709 --> 00:03:01,590 Sean Aylmer: that at least when it comes to intellect, you might 67 00:03:01,590 --> 00:03:04,290 Sean Aylmer: have topped the state in maths, Michael, but... 68 00:03:06,389 --> 00:03:09,419 Michael Thompson: Anyway, so I agree with Shane. Maybe you know what, 69 00:03:09,419 --> 00:03:12,900 Michael Thompson: I should both nominate my stories and judge them as 70 00:03:12,900 --> 00:03:15,629 Michael Thompson: well, like captain coach kind of thing. 71 00:03:16,350 --> 00:03:19,709 Adam Lang: There's several authoritarian regimes that use a similar thing. 72 00:03:21,210 --> 00:03:24,030 Michael Thompson: I wasn't going to point that out. Okay, look, we'll 73 00:03:24,030 --> 00:03:26,370 Michael Thompson: give it one more crack today of just seeing how 74 00:03:26,370 --> 00:03:28,980 Michael Thompson: we go. Let's see if I can eke out a 75 00:03:28,980 --> 00:03:32,460 Michael Thompson: victory today, and we'll jump straight in. I say jump 76 00:03:32,460 --> 00:03:34,499 Michael Thompson: straight in after we've just talked for four and a 77 00:03:34,500 --> 00:03:35,039 Michael Thompson: half minutes. 78 00:03:35,129 --> 00:03:35,999 Adam Lang: But thank you, Shane. 79 00:03:36,090 --> 00:03:39,780 Michael Thompson: Yeah, thank you Shane for a bit of a compliment 80 00:03:39,780 --> 00:03:41,760 Michael Thompson: sandwich there. So I appreciate the input. 81 00:03:41,760 --> 00:03:43,170 Sean Aylmer: A compliment sandwich. Yes, yes. 82 00:03:43,710 --> 00:03:45,150 Michael Thompson: Biggest story of the week, Sean, what was it? 83 00:03:46,440 --> 00:03:48,900 Sean Aylmer: Well, it's been a really big week. It's a funny 84 00:03:48,900 --> 00:03:52,019 Sean Aylmer: week because one day was massive corporate news and next 85 00:03:52,020 --> 00:03:55,620 Sean Aylmer: one was massive politics. Next one was massive economics. All 86 00:03:55,620 --> 00:03:58,200 Sean Aylmer: in all, I think the biggest story of the week was 87 00:03:58,200 --> 00:04:00,930 Sean Aylmer: economics, because this is the week we realized in hard 88 00:04:00,930 --> 00:04:05,669 Sean Aylmer: data, that the economy is slowing and inflation still isn't 89 00:04:05,759 --> 00:04:11,039 Sean Aylmer: under control. And that's pretty scary. Firstly, the building sector 90 00:04:11,039 --> 00:04:14,760 Sean Aylmer: has fallen out of bed. It's in a slump with 91 00:04:14,760 --> 00:04:18,390 Sean Aylmer: approvals for new dwellings down 24% compared to a year 92 00:04:18,390 --> 00:04:21,630 Sean Aylmer: ago. Now, obviously that's bad news for construction companies and 93 00:04:21,630 --> 00:04:23,639 Sean Aylmer: we've seen some of them go to the wall. Bad 94 00:04:23,639 --> 00:04:26,370 Sean Aylmer: news for builders, certainly bad news for tradies, but it's 95 00:04:26,370 --> 00:04:29,068 Sean Aylmer: also bad news for the economy, because the construction sector 96 00:04:29,070 --> 00:04:32,850 Sean Aylmer: more than anything, or any other sector, has the highest 97 00:04:32,850 --> 00:04:36,000 Sean Aylmer: multiplier effect. When someone builds a house, they fill it 98 00:04:36,000 --> 00:04:39,270 Sean Aylmer: with stuff, carpets and fridges and TVs and things like that, 99 00:04:39,270 --> 00:04:43,349 Sean Aylmer: and pictures that some partners don't like and others do. Anyway... 100 00:04:43,500 --> 00:04:45,390 Michael Thompson: This is a real issue for you, isn't it? 101 00:04:45,390 --> 00:04:46,859 Sean Aylmer: No, no, no. Jackie... 102 00:04:46,859 --> 00:04:49,229 Michael Thompson: You mentioned this... You just dropped a little hint through 103 00:04:49,230 --> 00:04:53,310 Michael Thompson: the week and clearly, your partner, Jackie wasn't listening to 104 00:04:53,310 --> 00:04:54,029 Michael Thompson: that episode. 105 00:04:54,839 --> 00:04:55,919 Sean Aylmer: I'll see if this one works. 106 00:04:56,428 --> 00:04:58,469 Michael Thompson: You are feeling bold and you feel like you can 107 00:04:58,469 --> 00:05:00,720 Michael Thompson: get away with a second reference. Clearly, Jackie has bought 108 00:05:00,779 --> 00:05:03,690 Michael Thompson: a picture for your house, for your newly renovated house. 109 00:05:03,691 --> 00:05:04,589 Sean Aylmer: No, no, no. 110 00:05:04,589 --> 00:05:04,650 Michael Thompson: You don't like it. 111 00:05:07,020 --> 00:05:09,210 Sean Aylmer: Anyway, the economic effect... Let's just move on. The economic 112 00:05:09,210 --> 00:05:13,170 Sean Aylmer: multiplier effect from construction is huge, and that sector is 113 00:05:13,350 --> 00:05:16,380 Sean Aylmer: in all sorts of trouble. We got monthly inflation, and 114 00:05:16,380 --> 00:05:18,389 Sean Aylmer: for the 12 months to the end of April, it 115 00:05:18,389 --> 00:05:22,919 Sean Aylmer: hit 6. 8%. That's up from 6. 3%. Housing, food, non- 116 00:05:22,920 --> 00:05:28,109 Sean Aylmer: alcoholic beverages, transport, recreation, prices are rising sharply. Now the 117 00:05:28,110 --> 00:05:32,279 Sean Aylmer: good news is the trend for inflation is down. The 118 00:05:32,279 --> 00:05:35,609 Sean Aylmer: bad news is that it's still way, way too high. 119 00:05:36,599 --> 00:05:40,409 Sean Aylmer: Rising wages will also keep pressure on prices. We get 120 00:05:40,469 --> 00:05:44,220 Sean Aylmer: the minimum and award wage decision next week. Bond markets 121 00:05:44,220 --> 00:05:46,860 Sean Aylmer: priced in another 25 basis point rate rise next week 122 00:05:46,860 --> 00:05:49,859 Sean Aylmer: when the reserve bank meets. Also, we had the boss 123 00:05:49,860 --> 00:05:52,320 Sean Aylmer: of Wesfarmers, Rob Scott coming out saying the glory days 124 00:05:52,320 --> 00:05:54,719 Sean Aylmer: of government largesse, low interest rates and good times for 125 00:05:54,719 --> 00:05:58,500 Sean Aylmer: companies including retailers, is well and truly over. And we're 126 00:05:58,500 --> 00:06:02,370 Sean Aylmer: moving into what he calls the big squeeze. Wesfarmers is 127 00:06:02,370 --> 00:06:06,539 Sean Aylmer: Australia's 10th largest company, that owns Bunnings, Officeworks, Kmart, Catch. com. 128 00:06:06,930 --> 00:06:10,770 Sean Aylmer: Scott said the honeymoon for many retailers is over. Shoppers 129 00:06:10,770 --> 00:06:14,938 Sean Aylmer: are trading down to cheaper products. Businesses face higher prices, 130 00:06:14,940 --> 00:06:18,060 Sean Aylmer: particularly wage pressures. And there's this big COVID drop in 131 00:06:18,150 --> 00:06:23,940 Sean Aylmer: productivity, hence the big squeeze. It's looking bad, higher inflation, 132 00:06:23,940 --> 00:06:27,719 Sean Aylmer: slowing economy, and we saw it this week in real 133 00:06:27,719 --> 00:06:32,310 Sean Aylmer: time. Massive story, Michael. Not much flourish in that story, 134 00:06:32,460 --> 00:06:34,019 Sean Aylmer: but a lot of worthiness. 135 00:06:34,440 --> 00:06:39,210 Michael Thompson: Did you say a lot of worthiness? Because that's how it felt 136 00:06:39,210 --> 00:06:41,460 Michael Thompson: to me. I get criticized a lot for taking too 137 00:06:41,460 --> 00:06:44,520 Michael Thompson: long, and it feels like today you have done that. 138 00:06:44,520 --> 00:06:46,109 Sean Aylmer: Do remember last week? Was it last week or the week 139 00:06:46,110 --> 00:06:48,330 Sean Aylmer: before that we actually timed how long one of your 140 00:06:48,330 --> 00:06:50,428 Sean Aylmer: stories... It was six minutes or something, wasn't it? 141 00:06:50,639 --> 00:06:51,629 Adam Lang: Quite the flourish. 142 00:06:51,928 --> 00:06:53,909 Michael Thompson: The biggest story this week, I'm just going to move 143 00:06:53,910 --> 00:06:56,969 Michael Thompson: on. I'm going to ignore the two of you now. And I 144 00:06:56,970 --> 00:06:59,339 Michael Thompson: realize that even as I say this, that you're just going 145 00:06:59,339 --> 00:07:03,750 Michael Thompson: to groan, but it has been a big week, a 146 00:07:03,750 --> 00:07:06,509 Michael Thompson: huge week. Sean sounded a little bit uncertain at the 147 00:07:06,509 --> 00:07:08,519 Michael Thompson: start. He goes, " I think the biggest story this week 148 00:07:08,520 --> 00:07:11,459 Michael Thompson: was the economy." No, no, no. The biggest story this week was 149 00:07:11,459 --> 00:07:16,170 Michael Thompson: in politics. But it's not one story. It's a number 150 00:07:16,170 --> 00:07:17,820 Michael Thompson: of stories combined into one. 151 00:07:19,020 --> 00:07:20,909 Sean Aylmer: More like resigned acceptance at this point. 152 00:07:21,059 --> 00:07:23,849 Michael Thompson: Yeah, I think you've learned that now. So look, I'm 153 00:07:23,849 --> 00:07:25,859 Michael Thompson: going to run through these very quickly, okay? 154 00:07:25,859 --> 00:07:25,920 Sean Aylmer: Yeah, sure. 155 00:07:25,920 --> 00:07:29,459 Michael Thompson: No, I am, I promise. Okay. So this week we 156 00:07:29,459 --> 00:07:32,250 Michael Thompson: had plenty coming out of Senate estimates. We got a 157 00:07:32,250 --> 00:07:34,320 Michael Thompson: bit of an insight into what goes on behind the 158 00:07:34,320 --> 00:07:37,920 Michael Thompson: scenes in government departments, the decision making, the thought processes 159 00:07:37,920 --> 00:07:41,429 Michael Thompson: for the top bureaucrats. It is fascinating and there's always 160 00:07:41,429 --> 00:07:43,200 Michael Thompson: good stories coming out of it. And two highlights in 161 00:07:43,200 --> 00:07:46,439 Michael Thompson: particular, Reserve Bank governor Phil Lowe, giving some insight into 162 00:07:46,440 --> 00:07:49,290 Michael Thompson: his thinking on inflation, warning that the rental market could 163 00:07:49,320 --> 00:07:52,500 Michael Thompson: get even tougher. He also said that PWC won't be 164 00:07:52,500 --> 00:07:54,690 Michael Thompson: doing any work for the central bank anytime soon off 165 00:07:54,690 --> 00:07:57,510 Michael Thompson: the back of the scandal that has engulfed PWC over 166 00:07:57,510 --> 00:08:00,390 Michael Thompson: the last few weeks. We had tax commissioner, Chris Jordan 167 00:08:00,420 --> 00:08:03,329 Michael Thompson: add estimates as well. He said that PWC was behind 168 00:08:03,330 --> 00:08:07,890 Michael Thompson: 15 schemes designed to help multinationals sidestep tax laws. Laws 169 00:08:07,890 --> 00:08:11,580 Michael Thompson: that PWC contributed to in terms of helping to design. 170 00:08:11,730 --> 00:08:14,610 Michael Thompson: 180 million dollars in tax revenue a year is at 171 00:08:14,610 --> 00:08:17,639 Michael Thompson: risk there. There's plenty more came out of estimates. I'm 172 00:08:17,639 --> 00:08:20,849 Michael Thompson: going to move on from estimates because I'm thinking now 173 00:08:20,940 --> 00:08:21,660 Michael Thompson: of the speed. 174 00:08:22,170 --> 00:08:26,760 Sean Aylmer: I think we need an asterisk next to the decision, Adam. 175 00:08:26,760 --> 00:08:26,820 Adam Lang: Why? 176 00:08:27,480 --> 00:08:30,120 Sean Aylmer: So I've had two stories in this one story so far, 177 00:08:30,120 --> 00:08:32,790 Sean Aylmer: and we are moving on to the others. Just pointing that out. 178 00:08:33,990 --> 00:08:34,920 Sean Aylmer: Go on, Michael. 179 00:08:35,759 --> 00:08:37,950 Michael Thompson: Okay. I think Shane has a point. There is collusion 180 00:08:38,040 --> 00:08:42,690 Michael Thompson: going on here. Adam, you could feel free to disagree 181 00:08:42,690 --> 00:08:45,840 Michael Thompson: at any point with Sean and say, " Yes, I'm going 182 00:08:45,840 --> 00:08:49,080 Michael Thompson: to remain impartial," instead you just went twice, which kind 183 00:08:49,080 --> 00:08:50,399 Michael Thompson: of says that you're on board with this. 184 00:08:50,669 --> 00:08:54,090 Adam Lang: No, I just wanted to let the silence speak for itself. 185 00:08:54,900 --> 00:08:58,529 Michael Thompson: Fine. Next story. The first piece of legislation required for 186 00:08:58,529 --> 00:09:00,958 Michael Thompson: the Voice to Parliament referendum passed the lower house this 187 00:09:00,960 --> 00:09:03,900 Michael Thompson: week. 121 votes to 25. Still a long way to 188 00:09:03,900 --> 00:09:06,809 Michael Thompson: go, but it is actually a major first step in 189 00:09:06,809 --> 00:09:09,660 Michael Thompson: that process. We had trade minister, Don Farrell threatening to 190 00:09:09,660 --> 00:09:12,090 Michael Thompson: go back to the World Trade Organization if China doesn't 191 00:09:12,090 --> 00:09:15,659 Michael Thompson: lift it's sanctions entirely on Bali. The prime minister is 192 00:09:15,660 --> 00:09:19,530 Michael Thompson: continuing his new role as global statesman, new as in 193 00:09:19,530 --> 00:09:21,689 Michael Thompson: the last year or so. He's in Singapore and Vietnam 194 00:09:21,690 --> 00:09:24,360 Michael Thompson: at the moment for defense, trade and investment talks. The 195 00:09:24,360 --> 00:09:27,570 Michael Thompson: free trade agreement between Australia and the UK kicked in 196 00:09:28,200 --> 00:09:31,078 Michael Thompson: this week, and then of course this week as if 197 00:09:31,080 --> 00:09:34,049 Michael Thompson: there wasn't enough, as if there weren't enough political stories 198 00:09:34,049 --> 00:09:34,828 Michael Thompson: already happening... 199 00:09:34,920 --> 00:09:36,000 Sean Aylmer: All in one. Yeah. 200 00:09:37,200 --> 00:09:40,620 Michael Thompson: We saw the most popular state premier in the country 201 00:09:40,650 --> 00:09:44,099 Michael Thompson: quit. Mark McGowan in WA declaring he's done, burnt out 202 00:09:44,099 --> 00:09:46,500 Michael Thompson: basically, and he wants to go before signs of that 203 00:09:46,500 --> 00:09:51,328 Michael Thompson: exhaustion. Clearly start to show. Extremely popular in WA. Controversial 204 00:09:52,049 --> 00:09:55,679 Michael Thompson: perhaps for his hardline stance during COVID, essentially sealing off 205 00:09:55,679 --> 00:09:57,990 Michael Thompson: the state from the rest of the country, which Adam, 206 00:09:58,290 --> 00:10:01,679 Michael Thompson: as someone who hails from Perth, I suspect is something 207 00:10:01,679 --> 00:10:03,450 Michael Thompson: that you've all wanted all along. 208 00:10:05,790 --> 00:10:07,890 Adam Lang: I'm not one of the secessionists, Michael. 209 00:10:08,190 --> 00:10:10,378 Michael Thompson: Okay. All right. Good to clear that up. But look, 210 00:10:10,379 --> 00:10:13,230 Michael Thompson: anyway, that's it. It has been a big week in politics 211 00:10:13,320 --> 00:10:18,000 Michael Thompson: and in that you have got 1, 2, 3, 4, 212 00:10:18,059 --> 00:10:22,800 Michael Thompson: 5, 6, 7, maybe eight individual stories, and still I 213 00:10:22,800 --> 00:10:25,049 Michael Thompson: got through it faster than Sean did. I get points 214 00:10:25,049 --> 00:10:25,499 Michael Thompson: for brevity. 215 00:10:30,869 --> 00:10:32,760 Sean Aylmer: His biggest story of the week is eight. 216 00:10:32,939 --> 00:10:36,630 Adam Lang: Yes. I think the answer was in the last statement, 217 00:10:36,630 --> 00:10:39,179 Adam Lang: really. Eight stories. 218 00:10:39,780 --> 00:10:43,770 Michael Thompson: Yeah, but I mean, Sean had building sector, that's one. 219 00:10:43,980 --> 00:10:47,309 Michael Thompson: And then the inflation data, that's another. You had Wesfarmer's 220 00:10:47,309 --> 00:10:49,858 Michael Thompson: boss coming out and saying things and then lots of 221 00:10:49,860 --> 00:10:53,520 Michael Thompson: little bits and pieces just scattered around. Whereas mine was 222 00:10:53,520 --> 00:10:56,370 Michael Thompson: one cohesive argument. Give me the point and let's move on. 223 00:10:58,920 --> 00:11:02,520 Adam Lang: No, I think Sean's was economic data and yours was 224 00:11:02,520 --> 00:11:05,940 Adam Lang: a eight stories of a political nature and then- 225 00:11:06,330 --> 00:11:07,559 Sean Aylmer: Grab bag. 226 00:11:10,230 --> 00:11:12,510 Adam Lang: Or an (inaudible) depending on which week it is. 227 00:11:12,510 --> 00:11:12,600 Sean Aylmer: Yes. 228 00:11:14,070 --> 00:11:17,759 Adam Lang: I think Sean has to win this. Michael, all of 229 00:11:17,759 --> 00:11:20,219 Adam Lang: those stories are important, but you didn't pick one and 230 00:11:20,219 --> 00:11:23,639 Adam Lang: nail it. That's what we want to hear. I think 231 00:11:23,639 --> 00:11:27,179 Adam Lang: in this instance, the biggest single piece of data amongst 232 00:11:27,179 --> 00:11:31,980 Adam Lang: the economic set was the inflation number going up. And 233 00:11:31,980 --> 00:11:36,059 Adam Lang: that's disturbing, right? No one wants to see that. And 234 00:11:36,059 --> 00:11:39,750 Adam Lang: the implications on interest rates and the uncertainty that continues 235 00:11:39,750 --> 00:11:43,800 Adam Lang: because inflation rates aren't continuing down, I think that is 236 00:11:43,800 --> 00:11:46,020 Adam Lang: the most profound impact on the economy this week. So 237 00:11:46,020 --> 00:11:47,550 Adam Lang: Sean, you win the biggest story of the week. 238 00:11:47,910 --> 00:11:49,920 Sean Aylmer: Thank you. Can I just ask, Michael, if you were 239 00:11:49,920 --> 00:11:52,410 Sean Aylmer: going to be judging that, which one would've you given 240 00:11:52,410 --> 00:11:52,679 Sean Aylmer: it to? 241 00:11:52,889 --> 00:11:55,349 Michael Thompson: Look, it would've been close, but I probably would've just 242 00:11:55,349 --> 00:11:56,250 Michael Thompson: won, I would say. 243 00:11:59,219 --> 00:12:03,450 Sean Aylmer: Righto. Michael, let's move in. How about you go first on the most remarkable story. 244 00:12:03,570 --> 00:12:06,570 Michael Thompson: All right. Well, this one's actually a very, very serious 245 00:12:06,570 --> 00:12:10,769 Michael Thompson: story. This one, there's no flourishes, no melodrama because this 246 00:12:10,770 --> 00:12:13,920 Michael Thompson: is quite an extraordinary story. The biggest defamation trial in 247 00:12:13,920 --> 00:12:17,429 Michael Thompson: Australian history, I believe. The undoing of a Victoria Cross 248 00:12:17,429 --> 00:12:21,150 Michael Thompson: recipient. I really wasn't sure if this could almost be 249 00:12:21,150 --> 00:12:24,300 Michael Thompson: the biggest story of the week, but I suspect that those 250 00:12:24,300 --> 00:12:27,270 Michael Thompson: of us in the media tend to have a heightened 251 00:12:27,360 --> 00:12:31,409 Michael Thompson: interest and awareness of defamation cases. But by anyone's measure, 252 00:12:31,530 --> 00:12:34,109 Michael Thompson: the facts of this case are clearly remarkable, and there 253 00:12:34,109 --> 00:12:37,950 Michael Thompson: is national significance to it as well. 110 days in 254 00:12:37,950 --> 00:12:43,170 Michael Thompson: court, 41 witnesses, 25 million in legal fees. And at 255 00:12:43,170 --> 00:12:48,030 Michael Thompson: the end of it all the extremely disturbing realization as 256 00:12:48,030 --> 00:12:52,439 Michael Thompson: found by Justice Anthony Besanko, that Victoria Cross recipient, Ben 257 00:12:52,440 --> 00:12:55,950 Michael Thompson: Robert Smith, was involved in the unlawful killing of unarmed 258 00:12:55,950 --> 00:13:00,360 Michael Thompson: Afghan prisoners. Justice Besanko ruled that The Age, The Sydney 259 00:13:00,360 --> 00:13:04,409 Michael Thompson: Morning Herald and the Canberra Times had proven their allegations. 260 00:13:04,469 --> 00:13:07,979 Michael Thompson: And these were very, very serious allegations that had witnesses, 261 00:13:07,980 --> 00:13:13,500 Michael Thompson: including former SAS soldiers and three Afghan locals. It was was 262 00:13:13,500 --> 00:13:17,429 Michael Thompson: a huge gamble by Ben Robert Smith suing these newspapers 263 00:13:17,429 --> 00:13:19,920 Michael Thompson: for defamation, and in the end, it didn't pay off. 264 00:13:19,920 --> 00:13:22,050 Michael Thompson: In fact, it went the other way with the judge 265 00:13:22,050 --> 00:13:24,990 Michael Thompson: finding that many, not all, but many of the allegations 266 00:13:24,990 --> 00:13:28,799 Michael Thompson: made by the newspapers were substantially true, including these two. 267 00:13:28,799 --> 00:13:31,890 Michael Thompson: And I'm quoting here, " That he broke the moral and 268 00:13:31,890 --> 00:13:34,860 Michael Thompson: legal rules of military engagement and is therefore a criminal. 269 00:13:35,100 --> 00:13:38,429 Michael Thompson: He disgraced his country, Australia and the Australian Army by 270 00:13:38,429 --> 00:13:41,759 Michael Thompson: his conduct as a member of the SAS in Afghanistan." It 271 00:13:41,759 --> 00:13:46,319 Michael Thompson: is a remarkable story all round, sad and distressing in 272 00:13:46,320 --> 00:13:49,980 Michael Thompson: the details, but really a credit to the journalism of 273 00:13:49,980 --> 00:13:53,760 Michael Thompson: the reporters from those newspapers, from the nine newspapers, and 274 00:13:53,760 --> 00:13:56,760 Michael Thompson: really to that company as well for standing by its reporting. 275 00:13:57,059 --> 00:14:00,389 Sean Aylmer: Yes, kudos to Nick Mackenzie and Chris Masters. They're the 276 00:14:00,389 --> 00:14:03,329 Sean Aylmer: guys that pushed that and good on what was Fairfax, 277 00:14:03,330 --> 00:14:08,160 Sean Aylmer: now Nine, for supporting their reporters in what is truly 278 00:14:08,160 --> 00:14:12,328 Sean Aylmer: a remarkable story. I would like at this point, because 279 00:14:12,330 --> 00:14:15,600 Sean Aylmer: I've obviously got to come up against that, I would like 280 00:14:15,929 --> 00:14:19,830 Sean Aylmer: Adam just to come up with the criteria, because this 281 00:14:19,830 --> 00:14:24,900 Sean Aylmer: is a remarkable one- off story affecting the media and 282 00:14:24,900 --> 00:14:27,930 Sean Aylmer: certainly the military. But just give us the criteria. What 283 00:14:27,930 --> 00:14:29,520 Sean Aylmer: are we talking about when you're looking for that? 284 00:14:29,520 --> 00:14:33,960 Adam Lang: Oh, okay. Criteria for all questions, Sean, one is topicality. I 285 00:14:33,960 --> 00:14:34,680 Adam Lang: think that was. 286 00:14:34,889 --> 00:14:35,159 Sean Aylmer: Yep. 287 00:14:35,219 --> 00:14:37,500 Adam Lang: Timeliness. Certainly, it's just happened. 288 00:14:37,559 --> 00:14:37,829 Sean Aylmer: Yep. 289 00:14:38,670 --> 00:14:39,779 Adam Lang: Economic impact. 290 00:14:40,709 --> 00:14:41,880 Sean Aylmer: Ooh, zipper. 291 00:14:42,150 --> 00:14:42,930 Adam Lang: Last one. 292 00:14:43,200 --> 00:14:43,470 Sean Aylmer: Yep. 293 00:14:43,650 --> 00:14:45,030 Adam Lang: Subjective bias. 294 00:14:45,210 --> 00:14:48,510 Sean Aylmer: Excellent. Right. I could be in trouble. Anyway, I am 295 00:14:48,510 --> 00:14:51,090 Sean Aylmer: putting all my eggs into the economic basket one on 296 00:14:51,090 --> 00:14:55,590 Sean Aylmer: this one. The most remarkable story, far more remarkable than 297 00:14:55,590 --> 00:14:57,780 Sean Aylmer: what Michael was talking about, and that is a very serious 298 00:14:57,780 --> 00:15:02,100 Sean Aylmer: issue that one. Far more important and remarkable is house 299 00:15:02,100 --> 00:15:06,149 Sean Aylmer: prices. Now, house prices across capital cities jumped by 1. 2% 300 00:15:06,149 --> 00:15:10,889 Sean Aylmer: during May, we found out this week, with Sydney prices 301 00:15:10,889 --> 00:15:14,009 Sean Aylmer: now up nearly 5% since their lows. Melbourne up nearly 302 00:15:14,009 --> 00:15:18,150 Sean Aylmer: 2%. Come on. No one in their right mind thought this 303 00:15:18,150 --> 00:15:22,650 Sean Aylmer: was going to happen. Truly remarkable. Whether it can keep 304 00:15:22,650 --> 00:15:25,920 Sean Aylmer: going is still an open question. It was the third 305 00:15:25,920 --> 00:15:29,430 Sean Aylmer: consecutive monthly rise though from CoreLogic's National Home Value Index, 306 00:15:29,820 --> 00:15:34,769 Sean Aylmer: and the acceleration in prices is much faster. The acceleration 307 00:15:35,039 --> 00:15:38,460 Sean Aylmer: during May was much faster than during March or April. 308 00:15:38,820 --> 00:15:43,200 Sean Aylmer: Last month, Sydney prices jumped 1.8%. Now that's the highest monthly 309 00:15:43,200 --> 00:15:48,180 Sean Aylmer: gain since September 2021. And the value of a median 310 00:15:48,210 --> 00:15:52,589 Sean Aylmer: dwelling in that city is now up nearly $50, 000 since 311 00:15:52,590 --> 00:15:56,040 Sean Aylmer: its January lows. Brisbane prices jumped last month by 1. 312 00:15:56,280 --> 00:16:00,180 Sean Aylmer: 4%. Perth was up 1. 3%. All the capital cities 313 00:16:00,180 --> 00:16:04,200 Sean Aylmer: were in positive territory. Everyone and their dog, and I 314 00:16:04,200 --> 00:16:08,370 Sean Aylmer: mean their dog are now upping their forecast for house 315 00:16:08,370 --> 00:16:11,369 Sean Aylmer: prices. And a shout-out to our Steven (inaudible) who said that 316 00:16:11,369 --> 00:16:13,470 Sean Aylmer: prices would fall by about 10%. It looks like he 317 00:16:13,470 --> 00:16:16,140 Sean Aylmer: was right in this. Anyway, that's a side effect. The 318 00:16:16,140 --> 00:16:19,740 Sean Aylmer: wealth effect is upon us. That's not good for those 319 00:16:19,740 --> 00:16:22,830 Sean Aylmer: hoping interest rates won't rise anymore, but it is truly 320 00:16:22,830 --> 00:16:26,940 Sean Aylmer: remarkable what happened in the housing sector, particularly during May, 321 00:16:26,940 --> 00:16:29,550 Sean Aylmer: which we found out this week. Adam. 322 00:16:29,580 --> 00:16:34,890 Adam Lang: Okay, great battle. I have to give this one to 323 00:16:34,890 --> 00:16:39,209 Adam Lang: Michael. And even on the economic impact, I think, Sean, 324 00:16:39,210 --> 00:16:41,969 Adam Lang: the fact that remarkability of house prices going up again in 325 00:16:41,969 --> 00:16:46,079 Adam Lang: May was incredible. And I must also reference the great 326 00:16:46,080 --> 00:16:48,959 Adam Lang: interview you did with Tim Lawless from CoreLogic. 327 00:16:49,200 --> 00:16:49,710 Sean Aylmer: Bonus point? 328 00:16:51,030 --> 00:16:53,100 Michael Thompson: Oh, you don't want to appear too desperate, Sean. 329 00:16:53,130 --> 00:16:55,141 Adam Lang: Nice plea, but no. 330 00:16:55,141 --> 00:16:57,960 Sean Aylmer: As soon as you said Ben Robert Smith trial, as if 331 00:16:57,960 --> 00:16:59,430 Sean Aylmer: I had a chance in this one. Come on. 332 00:17:01,679 --> 00:17:03,779 Adam Lang: Well, obviously all three of us used to serve in 333 00:17:03,780 --> 00:17:06,900 Adam Lang: the media industry, but this is a 20 million dollar 334 00:17:07,320 --> 00:17:09,360 Adam Lang: estimate on legal fees alone. 335 00:17:10,140 --> 00:17:12,150 Sean Aylmer: 25 Adam. 25, I think. 336 00:17:12,420 --> 00:17:16,559 Adam Lang: Oh wow. Okay. Even worse. Now that's got to be 337 00:17:16,559 --> 00:17:19,650 Adam Lang: worked out as to where those costs lie after Ben 338 00:17:19,650 --> 00:17:23,729 Adam Lang: Robert Smith has lost that case. But the impact on 339 00:17:23,730 --> 00:17:27,928 Adam Lang: journalism in general and the business of journalism and reporting, 340 00:17:28,380 --> 00:17:33,150 Adam Lang: defamation law and so on, you have to really look at defamation 341 00:17:33,150 --> 00:17:35,129 Adam Lang: law in this country and say, " Should it be that 342 00:17:35,130 --> 00:17:40,559 Adam Lang: hard to publish and defend what they did as journalists and 343 00:17:40,559 --> 00:17:42,359 Adam Lang: for the media to report it in news and so 344 00:17:42,359 --> 00:17:46,170 Adam Lang: on." So I think it actually has a profound impact 345 00:17:46,170 --> 00:17:49,680 Adam Lang: on defamation law, and therefore the media industry, beyond just 346 00:17:49,680 --> 00:17:52,229 Adam Lang: this week. So that's why I've given this one to Michael. 347 00:17:53,070 --> 00:17:56,309 Sean Aylmer: Yeah, I mean, so I've accepted the ruling. It is 348 00:17:56,309 --> 00:18:00,388 Sean Aylmer: interesting what you say there, because the burden of proof 349 00:18:00,720 --> 00:18:06,600 Sean Aylmer: is so significant and obviously fair. Fairfax/ Nine spent a lot 350 00:18:06,600 --> 00:18:10,349 Sean Aylmer: of money flying people over from Afghanistan and getting SAS 351 00:18:10,740 --> 00:18:14,489 Sean Aylmer: soldiers to speak. So I mean, the burden is so, 352 00:18:14,580 --> 00:18:17,939 Sean Aylmer: so heavy and they did it. And so all credit to them. 353 00:18:17,940 --> 00:18:20,340 Sean Aylmer: And I mean, I have sort of overseen... I didn't oversee 354 00:18:20,340 --> 00:18:23,130 Sean Aylmer: this story in any sense, but I have been involved 355 00:18:23,130 --> 00:18:27,330 Sean Aylmer: in stories which are major, and the media goes through 356 00:18:27,330 --> 00:18:29,399 Sean Aylmer: all sorts of trials and tribulations about whether they should 357 00:18:29,400 --> 00:18:31,679 Sean Aylmer: run them or not, because in the end, their job 358 00:18:31,679 --> 00:18:35,549 Sean Aylmer: is to reveal the truth. But you can really hurt 359 00:18:35,549 --> 00:18:37,470 Sean Aylmer: people along the way and that's not the goal. And 360 00:18:37,470 --> 00:18:41,668 Sean Aylmer: so anyway, all credit to them for going through with it. 361 00:18:42,029 --> 00:18:42,449 Adam Lang: Yeah. 362 00:18:43,080 --> 00:18:45,418 Sean Aylmer: That was the most serious 10 minutes we've ever had on the 363 00:18:45,420 --> 00:18:45,990 Sean Aylmer: weekend edition. 364 00:18:46,350 --> 00:18:48,658 Michael Thompson: I know. All right. We will come back in a 365 00:18:48,660 --> 00:18:50,910 Michael Thompson: moment and lighten things up a little bit with the sleeper 366 00:18:50,910 --> 00:18:58,800 Michael Thompson: story of the week. All right, Sean, we're looking for 367 00:18:58,800 --> 00:19:01,770 Michael Thompson: the sleeper story of the week. This is a story 368 00:19:01,770 --> 00:19:04,770 Michael Thompson: that's not necessarily getting the attention that you think it 369 00:19:04,770 --> 00:19:07,918 Michael Thompson: deserves, or that's going to become a bigger story further 370 00:19:07,920 --> 00:19:10,230 Michael Thompson: down the track. I hate this category. I really do. 371 00:19:10,980 --> 00:19:11,941 Michael Thompson: I really struggle with it everywhere. 372 00:19:11,941 --> 00:19:15,270 Adam Lang: This is not a great introduction, Michael. It's not one of your greatest. 373 00:19:15,300 --> 00:19:17,700 Michael Thompson: I'm not giving up, I'm not giving up, but I 374 00:19:17,700 --> 00:19:20,160 Michael Thompson: am saying that this is hard and I should get 375 00:19:20,160 --> 00:19:24,210 Michael Thompson: points for facing the adversity, my own adversity. 376 00:19:24,450 --> 00:19:27,659 Sean Aylmer: Do you think it's an intellect thing? Not being able 377 00:19:27,660 --> 00:19:30,330 Sean Aylmer: to see the future, that sort of stuff? Shane, come 378 00:19:30,330 --> 00:19:30,870 Sean Aylmer: on down. 379 00:19:30,959 --> 00:19:33,811 Michael Thompson: I should never have revealed Shane's comments to you. 380 00:19:33,811 --> 00:19:33,811 Adam Lang: We're glad you did. 381 00:19:33,811 --> 00:19:39,900 Sean Aylmer: We delighted. I'm going to jump in there because mine is definitely a sleeper. 382 00:19:40,020 --> 00:19:40,590 Michael Thompson: Yeah, do it. 383 00:19:40,590 --> 00:19:41,160 Sean Aylmer: Without a doubt. 384 00:19:41,550 --> 00:19:42,030 Michael Thompson: Yeah, go on. 385 00:19:42,660 --> 00:19:48,569 Sean Aylmer: Phillip Morris International, the company which makes cigarettes, reckons it's 386 00:19:48,570 --> 00:19:51,898 Sean Aylmer: on its way to becoming an ESG stock. Who would've thought? 387 00:19:54,090 --> 00:19:55,530 Adam Lang: Sorry for openly laughing. 388 00:19:57,480 --> 00:19:59,579 Sean Aylmer: If you don't know what ESG is, environmental, social, and 389 00:19:59,580 --> 00:20:03,150 Sean Aylmer: governance. Basically, investors put their money into things that improve 390 00:20:03,150 --> 00:20:07,738 Sean Aylmer: the world. Energy transformation, green energy, hydrogen power. That's the 391 00:20:07,740 --> 00:20:09,900 Sean Aylmer: big one at the moment. Biodiversity is another big one. 392 00:20:09,900 --> 00:20:12,930 Sean Aylmer: Clean water, all that sort of thing. They tend to 393 00:20:12,930 --> 00:20:17,549 Sean Aylmer: stay away from things like bombs and cigarettes. Last year, 394 00:20:17,550 --> 00:20:22,379 Sean Aylmer: Philip Morris sold 621 billion cigarettes worldwide. Now cigarettes are 395 00:20:22,379 --> 00:20:26,880 Sean Aylmer: the leading cause of preventable death globally. So you ask 396 00:20:26,880 --> 00:20:30,540 Sean Aylmer: me why is it a sleeper story? Well, no one 397 00:20:30,540 --> 00:20:32,520 Sean Aylmer: thinks they're going to become an ESG stock, but this 398 00:20:32,520 --> 00:20:35,879 Sean Aylmer: week we found out they reckon they might. Boss, Jacek 399 00:20:35,880 --> 00:20:39,359 Sean Aylmer: Olczak, pointed to the fact that because the company now 400 00:20:39,359 --> 00:20:44,850 Sean Aylmer: makes less harmful nicotine alternatives like vapes, maybe that could be 401 00:20:44,850 --> 00:20:48,420 Sean Aylmer: considered heading down the ESG route. When asked by the 402 00:20:48,420 --> 00:20:50,939 Sean Aylmer: Financial Times, if one day the company might be classified 403 00:20:50,940 --> 00:20:52,888 Sean Aylmer: as an ESG stock because of its push away from 404 00:20:52,888 --> 00:20:56,789 Sean Aylmer: cigarettes, he said, " I think so." Not exactly confident there. 405 00:20:56,969 --> 00:21:02,609 Sean Aylmer: Now this is clearly a sleeper. It's not a ridiculous 406 00:21:02,609 --> 00:21:06,270 Sean Aylmer: story though, because a lot of the big fund managers, 407 00:21:06,990 --> 00:21:11,010 Sean Aylmer: they screen out cigarette companies, for example. But others think, " 408 00:21:11,010 --> 00:21:13,109 Sean Aylmer: Well, it's actually about engagement. They're going to be doing 409 00:21:13,109 --> 00:21:16,408 Sean Aylmer: it. It's not illegal, so if we engage with them 410 00:21:16,949 --> 00:21:20,520 Sean Aylmer: and get them to shift down the curve so the 411 00:21:20,520 --> 00:21:23,310 Sean Aylmer: damage they're doing is less, then they can be an 412 00:21:23,310 --> 00:21:25,888 Sean Aylmer: ESG stock." Oil and gas companies are the great examples 413 00:21:26,070 --> 00:21:30,210 Sean Aylmer: of that. Investors argue, " We're engaging with oil and gas 414 00:21:30,210 --> 00:21:32,520 Sean Aylmer: companies. They're doing less oil, they're doing more gas, and 415 00:21:32,520 --> 00:21:35,099 Sean Aylmer: eventually they'll go to Green Energy alternatives." So it's along 416 00:21:35,100 --> 00:21:40,500 Sean Aylmer: those arguments. Definitely a sleeper story though. Phillip Morris International becoming an 417 00:21:40,500 --> 00:21:44,520 Sean Aylmer: ESG stock. Whew. No one has ever thought of that. Michael. 418 00:21:44,910 --> 00:21:48,178 Michael Thompson: That is a great one. And you know what? Here we 419 00:21:48,179 --> 00:21:52,140 Michael Thompson: go. I'm just jumping straight into this. 420 00:21:52,140 --> 00:21:52,650 Sean Aylmer: Yes. 421 00:21:52,740 --> 00:21:55,829 Michael Thompson: Because it seems a little bit ridiculous describing my story as a 422 00:21:56,010 --> 00:22:03,809 Michael Thompson: sleeper story, but I specialize in ridiculous. The broader... Don't 423 00:22:03,809 --> 00:22:07,740 Michael Thompson: laugh. The broader theme of underpayments is the sleeper here. 424 00:22:08,340 --> 00:22:09,388 Sean Aylmer: Underpayments of what? 425 00:22:09,599 --> 00:22:10,948 Michael Thompson: Underpayments of staff. 426 00:22:11,190 --> 00:22:12,750 Sean Aylmer: That we've been talking about for three years. 427 00:22:13,050 --> 00:22:17,460 Michael Thompson: That is the sleeper. And BHP may just be the alarm 428 00:22:17,460 --> 00:22:19,020 Michael Thompson: clock that wakes it up. 429 00:22:19,560 --> 00:22:21,810 Sean Aylmer: Oh, beautiful. Beautiful. 430 00:22:23,670 --> 00:22:27,660 Michael Thompson: This week we learned that Australia's biggest company has underpaid 431 00:22:28,650 --> 00:22:32,880 Michael Thompson: 28 and a half thousand past and present employees by $ 430 million. 432 00:22:33,150 --> 00:22:35,550 Michael Thompson: I've glossed over the size of that because it makes it sound like 433 00:22:35,550 --> 00:22:38,430 Michael Thompson: it couldn't possibly be a sleeper story, but it was 434 00:22:38,490 --> 00:22:42,480 Michael Thompson: as they all seem to be a calculation error, wrongly deducting 435 00:22:42,540 --> 00:22:45,418 Michael Thompson: annual leave from staff entitlements. Problem is, it's been happening 436 00:22:45,420 --> 00:22:47,520 Michael Thompson: for 13 years. So the sum owed has grown and 437 00:22:47,520 --> 00:22:49,619 Michael Thompson: grown and grown and grown and grown. Now this issue 438 00:22:49,619 --> 00:22:56,638 Michael Thompson: has been bubbling along. Bubbling, maybe boiling. We keep hearing 439 00:22:56,638 --> 00:23:01,198 Michael Thompson: about it, right? The Fair Work Ombudsman recovered a record $ 440 00:23:01,320 --> 00:23:07,138 Michael Thompson: 532 million, a record in back pay in '21, '22. In 441 00:23:07,140 --> 00:23:09,690 Michael Thompson: recent years, we've had Woolworths and Commonwealth Bank and McDonald's, 442 00:23:09,690 --> 00:23:12,570 Michael Thompson: Mecca, Cosmetica, even the Reserve Bank has been discovered to 443 00:23:12,570 --> 00:23:15,330 Michael Thompson: have underpaid staff. It's not deliberate, as I said, just 444 00:23:15,330 --> 00:23:18,509 Michael Thompson: the result of confusing laws, lots of internal processes, changes 445 00:23:18,509 --> 00:23:20,549 Michael Thompson: to regulations, all that kind of thing. But it is 446 00:23:20,549 --> 00:23:23,789 Michael Thompson: a sleeper, because remember that definition. A story that's going 447 00:23:23,789 --> 00:23:27,510 Michael Thompson: to become bigger, further down the track, because it will 448 00:23:27,510 --> 00:23:30,510 Michael Thompson: not end here. We've had now the biggest company in 449 00:23:30,510 --> 00:23:33,119 Michael Thompson: Australia acknowledge almost half a billion dollars in underpayments. You 450 00:23:33,119 --> 00:23:35,970 Michael Thompson: can bet your bottom dollar, right, that every other company 451 00:23:36,030 --> 00:23:39,388 Michael Thompson: in this country is going, " Uh oh. If it could 452 00:23:39,388 --> 00:23:42,600 Michael Thompson: happen to them, it could happen to us. We could 453 00:23:42,600 --> 00:23:46,138 Michael Thompson: be next." So watch this space. This story will continue 454 00:23:46,140 --> 00:23:50,849 Michael Thompson: to play out. BHP today. Who knows who it will 455 00:23:50,849 --> 00:23:56,879 Michael Thompson: be tomorrow? Sleeper story. Have I convinced you, Adam? 456 00:23:57,809 --> 00:24:03,810 Adam Lang: The louder I say it, the more convincing it is. No, but actually I 457 00:24:03,810 --> 00:24:06,450 Adam Lang: don't know that either are real sleeper stories. 458 00:24:06,450 --> 00:24:11,070 Sean Aylmer: Have you ever given zero for both? 459 00:24:11,070 --> 00:24:15,330 Adam Lang: I think I might. Sean, do you remember, it was 460 00:24:15,330 --> 00:24:17,880 Adam Lang: a satire film called Thank You for Smoking? 461 00:24:18,150 --> 00:24:18,690 Sean Aylmer: Yes. 462 00:24:19,320 --> 00:24:22,859 Adam Lang: It's not quite 20 years old, I don't think. But this 463 00:24:22,859 --> 00:24:25,560 Adam Lang: Philip Morris story just reminded me of that. It's like, " 464 00:24:26,280 --> 00:24:31,559 Adam Lang: What's on?" Is he saying a smoking manufacturer to become 465 00:24:32,280 --> 00:24:35,759 Adam Lang: ESG friendly is like, okay, that's entered the bizarre for 466 00:24:35,760 --> 00:24:39,210 Adam Lang: me. But I guess it is a sleeper to see 467 00:24:39,210 --> 00:24:42,208 Adam Lang: if they could actually achieve it, because that would be a 468 00:24:42,210 --> 00:24:48,388 Adam Lang: first. Anyway, over to BHP and underpayments. So BHP is new. 469 00:24:48,388 --> 00:24:50,339 Adam Lang: It's not really sleeper because it's happened and happened for 470 00:24:50,340 --> 00:24:55,200 Adam Lang: years. And there have been stories like this for years, so... About 1996, 471 00:24:55,200 --> 00:24:57,388 Adam Lang: sounds like a long time ago. I was in Atlanta for 472 00:24:57,390 --> 00:24:59,520 Adam Lang: the Olympics and I was fortunate enough to go to 473 00:24:59,520 --> 00:25:03,388 Adam Lang: one of the gymnastics sessions. And it was, I can't remember 474 00:25:03,388 --> 00:25:05,369 Adam Lang: the guy's name, he was an Australian guy and he 475 00:25:05,369 --> 00:25:08,009 Adam Lang: was on the vault. And so he starts at the 476 00:25:08,009 --> 00:25:11,279 Adam Lang: beginning of his runway and slow steps, fast steps, run, 477 00:25:11,279 --> 00:25:15,300 Adam Lang: run, run, run, run, run. He hits the trampoline, skews 478 00:25:15,300 --> 00:25:20,220 Adam Lang: off the wrong way and somehow misses the vault totally. 479 00:25:20,340 --> 00:25:20,879 Sean Aylmer: Oh no. 480 00:25:20,940 --> 00:25:27,001 Adam Lang: Landing on his back. And there was this moment of just (inaudible) 481 00:25:27,001 --> 00:25:29,999 Adam Lang: from everyone, and it was like he looked up, one eye, thought, " 482 00:25:30,240 --> 00:25:32,760 Adam Lang: Maybe no one noticed." So he jumps up and he 483 00:25:32,760 --> 00:25:33,658 Adam Lang: does the hands... 484 00:25:34,439 --> 00:25:34,619 Sean Aylmer: Like the bow? 485 00:25:34,619 --> 00:25:36,870 Adam Lang: Hands to the crowd. That total bow to the crowd. 486 00:25:37,470 --> 00:25:40,650 Adam Lang: And everyone's (inaudible) . Anyway, it comes to the judging. 487 00:25:42,420 --> 00:25:47,309 Adam Lang: The judges just go zero, zero, zero, because he actually 488 00:25:47,309 --> 00:25:49,979 Adam Lang: missed touching the vault and the whole idea of vault, 489 00:25:50,550 --> 00:25:52,500 Adam Lang: is that you got to touch the vault. And so 490 00:25:52,500 --> 00:25:55,590 Adam Lang: he missed. And I feel this category might be a 491 00:25:55,590 --> 00:25:56,790 Adam Lang: bit the same. These stories. 492 00:25:59,609 --> 00:26:01,498 Michael Thompson: Both of us are going to get zero, zero, zero. 493 00:26:01,559 --> 00:26:08,400 Adam Lang: Yeah, I think we'll do that. Nice stories though. They're amusing. 494 00:26:09,540 --> 00:26:11,609 Michael Thompson: Wow. So what are we one all now? 495 00:26:11,609 --> 00:26:11,850 Adam Lang: One all. 496 00:26:12,450 --> 00:26:14,580 Michael Thompson: With who knows for category three. 497 00:26:17,609 --> 00:26:18,780 Sean Aylmer: Okay. How about you guys? So it's our favorite story, isn't it? 498 00:26:18,780 --> 00:26:19,350 Michael Thompson: All right. 499 00:26:20,160 --> 00:26:20,969 Sean Aylmer: Do you want to go first? 500 00:26:21,509 --> 00:26:21,510 Michael Thompson: Sure. 501 00:26:21,510 --> 00:26:21,869 Sean Aylmer: Righto. 502 00:26:21,869 --> 00:26:26,160 Michael Thompson: I've been a little bit spoiled for choice this week 503 00:26:27,720 --> 00:26:30,360 Michael Thompson: on space and aircraft related stories. 504 00:26:31,530 --> 00:26:33,840 Sean Aylmer: I'm surprised this isn't your sleeper story, really. 505 00:26:35,130 --> 00:26:41,309 Michael Thompson: Oh, yeah. No. So much regret. Look, I mean, I could have chosen 506 00:26:41,400 --> 00:26:44,520 Michael Thompson: China starting another space race, racing to get to the 507 00:26:44,520 --> 00:26:49,230 Michael Thompson: moon. Could have chosen Jetstar CEO's apology to passengers for 508 00:26:49,230 --> 00:26:54,540 Michael Thompson: the airline's somewhat patchy performance, but, but, but this was a 509 00:26:54,540 --> 00:26:58,680 Michael Thompson: massive week for Qantas. So that is where I've landed. 510 00:26:59,789 --> 00:27:00,029 Sean Aylmer: Nice. 511 00:27:00,029 --> 00:27:00,720 Michael Thompson: Did you like that one? 512 00:27:00,930 --> 00:27:01,561 Sean Aylmer: Touchdown. Yeah. 513 00:27:01,561 --> 00:27:06,420 Michael Thompson: Yeah. Thank you. We had CEO, Alan Joyce fronting his 514 00:27:06,420 --> 00:27:09,359 Michael Thompson: last investor presentation, which must have been a pretty momentous 515 00:27:09,359 --> 00:27:13,379 Michael Thompson: occasion for him, wouldn't it? And there was a lot in it. It feels like he just busted 516 00:27:13,380 --> 00:27:15,750 Michael Thompson: everything out for the last one here. He said the 517 00:27:15,750 --> 00:27:19,770 Michael Thompson: ultra long haul flights to London, it'll be 19 hours 518 00:27:19,770 --> 00:27:22,680 Michael Thompson: mind you, will start in just two years time. And 519 00:27:22,680 --> 00:27:25,800 Michael Thompson: importantly for investors, they will be lucrative. The first full 520 00:27:25,800 --> 00:27:27,749 Michael Thompson: year of flying East coast of London and to New 521 00:27:27,750 --> 00:27:30,929 Michael Thompson: York, we'll see $ 400 million added to earnings. The other 522 00:27:30,929 --> 00:27:33,330 Michael Thompson: big developments for Qantas this week, because there was more than 523 00:27:33,330 --> 00:27:34,619 Michael Thompson: that. So much more than that. 524 00:27:35,190 --> 00:27:37,470 Sean Aylmer: I've never known you to just do one story, Michael. 525 00:27:37,710 --> 00:27:40,260 Michael Thompson: Well, no, this is one story with multiple prongs. I 526 00:27:40,260 --> 00:27:43,230 Michael Thompson: think I mentioned this last week that I like to... 527 00:27:44,280 --> 00:27:45,120 Sean Aylmer: You like the prong? 528 00:27:45,480 --> 00:27:49,678 Michael Thompson: Yeah. Okay, I'm going to move on. Another big development 529 00:27:49,710 --> 00:27:54,330 Michael Thompson: was Qantas forecasting Qantas loyalty to deliver up to $ 1 530 00:27:54,330 --> 00:27:59,790 Michael Thompson: billion of earnings by 2030 through, quote, a targeted expansion 531 00:27:59,790 --> 00:28:03,178 Michael Thompson: in financial services and insurance. Now that, that should have 532 00:28:03,179 --> 00:28:07,079 Michael Thompson: been my sleeper story, because that sounds like a massive 533 00:28:07,080 --> 00:28:11,070 Michael Thompson: push into money and insurance. But I mean, it's still my favorite. 534 00:28:11,070 --> 00:28:13,200 Michael Thompson: So I'm going to win with it here. And then 535 00:28:13,200 --> 00:28:15,180 Michael Thompson: there's the overhaul of the Qantas app, so you can 536 00:28:15,180 --> 00:28:17,879 Michael Thompson: track your luggage, which I feel like is just a 537 00:28:17,880 --> 00:28:20,609 Michael Thompson: little bit redundant. Do you really want to know where 538 00:28:20,609 --> 00:28:23,460 Michael Thompson: it is? Isn't it just better that Qantas knows where 539 00:28:23,460 --> 00:28:24,388 Michael Thompson: your luggage is? 540 00:28:24,388 --> 00:28:24,988 Sean Aylmer: Yes, good point. 541 00:28:25,259 --> 00:28:27,239 Michael Thompson: You don't need to tell your passengers where it is, 542 00:28:27,240 --> 00:28:29,250 Michael Thompson: otherwise you're just going to get stressed about it. 543 00:28:29,789 --> 00:28:32,280 Sean Aylmer: I just want it to be on the conveyor belt when I 544 00:28:32,280 --> 00:28:32,968 Sean Aylmer: get off the plane. 545 00:28:33,060 --> 00:28:35,220 Michael Thompson: Yep, yep, yep, yep, yep. You just want to see 546 00:28:35,220 --> 00:28:40,710 Michael Thompson: it disappear into the cavernous backend of the airport, knowing 547 00:28:40,710 --> 00:28:42,719 Michael Thompson: that it will be there when you get to the 548 00:28:42,719 --> 00:28:47,490 Michael Thompson: other end. And then just quickly, very quickly, because that's 549 00:28:47,490 --> 00:28:49,229 Michael Thompson: my theme today, is just doing everything a little bit 550 00:28:49,230 --> 00:28:54,570 Michael Thompson: faster. Those 19 hour flights, 19 hours is a very 551 00:28:54,570 --> 00:28:57,209 Michael Thompson: long flight. So Adam, I did a little bit of 552 00:28:57,210 --> 00:28:59,910 Michael Thompson: research for you to see how you could fill that 553 00:28:59,910 --> 00:29:04,679 Michael Thompson: time. And did you know that you could watch all 554 00:29:04,740 --> 00:29:08,070 Michael Thompson: nine Star Wars films, and I know you're a fellow 555 00:29:08,070 --> 00:29:09,060 Michael Thompson: Star Wars fan. 556 00:29:09,090 --> 00:29:09,930 Adam Lang: Back to back? 557 00:29:10,140 --> 00:29:14,970 Michael Thompson: Yes. Back to back in 20 hours and 39 minutes. So 558 00:29:15,300 --> 00:29:19,020 Michael Thompson: I reckon if you skip the credits and the boring 559 00:29:19,020 --> 00:29:22,110 Michael Thompson: bits where Luke and Yoda are talking about boring stuff, which... 560 00:29:23,549 --> 00:29:23,550 Adam Lang: What? 561 00:29:23,550 --> 00:29:27,690 Sean Aylmer: There'll be no skipping there. 562 00:29:28,710 --> 00:29:30,571 Michael Thompson: You could just about fit it all in. 563 00:29:30,571 --> 00:29:34,409 Adam Lang: Okay, and maybe do the whole Lord of the Rings series 564 00:29:34,410 --> 00:29:35,100 Adam Lang: on the way back. 565 00:29:36,389 --> 00:29:40,080 Michael Thompson: No, that would be ridiculous. I've never seen Lord of 566 00:29:40,080 --> 00:29:42,720 Michael Thompson: the Rings, so I mean, I really can't pass judgment. 567 00:29:42,720 --> 00:29:44,280 Adam Lang: That's crazy talk. 568 00:29:44,550 --> 00:29:47,580 Michael Thompson: No, well, I mean 20 hours, 39 minutes. I mean, 569 00:29:47,580 --> 00:29:50,130 Michael Thompson: you've also then got a couple of spinoff films and 570 00:29:50,130 --> 00:29:52,980 Michael Thompson: you could watch The Mandalorian and some other series as well 571 00:29:52,980 --> 00:29:54,840 Michael Thompson: if you wanted to on the way back. But 19 572 00:29:54,840 --> 00:29:56,910 Michael Thompson: hours, enough time to watch all nine Star Wars movies. 573 00:29:57,000 --> 00:29:58,800 Adam Lang: Anything from the LucasArts family? 574 00:29:59,040 --> 00:30:01,890 Michael Thompson: Yeah, go for it. Yeah, yeah. Watch Indiana Jones. There's a new 575 00:30:01,890 --> 00:30:05,460 Michael Thompson: Indiana Jones movie coming out. Sorry, I thought I'd share 576 00:30:05,460 --> 00:30:07,711 Michael Thompson: that with you. Sorry, I forgot we were recording. 577 00:30:07,711 --> 00:30:09,569 Adam Lang: Harrison Ford, still going. 578 00:30:10,020 --> 00:30:14,850 Sean Aylmer: Look, that that's more plain stuff from Michael. No surprises. 579 00:30:15,360 --> 00:30:18,960 Sean Aylmer: My favorite is purely on entertainment value. And this is 580 00:30:18,960 --> 00:30:22,470 Sean Aylmer: about the government official in India who was suspended from 581 00:30:22,470 --> 00:30:26,729 Sean Aylmer: his job after he ordered a water reservoir to be 582 00:30:26,730 --> 00:30:31,559 Sean Aylmer: drained so he could retrieve his smartphone, which he had 583 00:30:31,559 --> 00:30:35,820 Sean Aylmer: dropped while taking a selfie. So the food inspector dropped 584 00:30:35,820 --> 00:30:39,690 Sean Aylmer: his Samsung smartphone. Not sure why everyone keeps talking about 585 00:30:39,690 --> 00:30:41,880 Sean Aylmer: it as a Samsung smartphone. 586 00:30:42,270 --> 00:30:44,280 Adam Lang: Good product placement though. Well done, Samsung. 587 00:30:44,730 --> 00:30:48,030 Sean Aylmer: Yeah, perhaps. Into this reservoir in central India. This is according to 588 00:30:48,030 --> 00:30:50,850 Sean Aylmer: The Times of India, which is a very reputable newspaper. 589 00:30:51,150 --> 00:30:54,330 Sean Aylmer: The inspector then instructed local divers to jump into the 590 00:30:54,330 --> 00:30:57,750 Sean Aylmer: reservoir to find the phone, claiming it contained sensitive government 591 00:30:57,750 --> 00:31:01,140 Sean Aylmer: data. Now they couldn't find it. So he then went 592 00:31:01,140 --> 00:31:04,860 Sean Aylmer: and ordered for the reservoir to be emptied using diesel 593 00:31:04,860 --> 00:31:09,060 Sean Aylmer: pumps. Now I don't really know why a food inspector 594 00:31:09,450 --> 00:31:12,359 Sean Aylmer: would be listened to in this instance. However, over the 595 00:31:12,359 --> 00:31:14,550 Sean Aylmer: next three days, more than 2 million liters of water 596 00:31:14,550 --> 00:31:17,400 Sean Aylmer: was pumped out, which is enough to irrigate at least 1, 597 00:31:17,400 --> 00:31:22,470 Sean Aylmer: 500 acres of land. The food inspector told local media 598 00:31:22,530 --> 00:31:25,530 Sean Aylmer: the water in the reservoir was unusable for irrigation, which 599 00:31:25,530 --> 00:31:28,679 Sean Aylmer: proved to be wrong, and that he'd received permission from 600 00:31:28,680 --> 00:31:31,860 Sean Aylmer: a senior official to drain it, which also proved to be 601 00:31:31,860 --> 00:31:36,150 Sean Aylmer: wrong. He was seen sitting under a red umbrella. Again, 602 00:31:36,150 --> 00:31:39,119 Sean Aylmer: don't know why the red umbrella is so relevant, watching 603 00:31:39,120 --> 00:31:41,430 Sean Aylmer: all this going on. Anyway, the upshot of it is 604 00:31:41,490 --> 00:31:50,220 Sean Aylmer: they found the phone. Alas, it didn't work. Oh my 605 00:31:50,220 --> 00:31:51,330 Sean Aylmer: God, what a great story. 606 00:31:51,660 --> 00:31:54,450 Adam Lang: The fact that it's just gotten publicized around the world. 607 00:31:56,220 --> 00:32:00,779 Adam Lang: Including the images of him sitting, watching, supervising the drainage. 608 00:32:01,889 --> 00:32:08,130 Adam Lang: So, okay. Favorite. I think Michael, you mentioned China and 609 00:32:08,130 --> 00:32:14,910 Adam Lang: the moon, Jetstar's patchy performance, but landed on Joyce's last 610 00:32:14,910 --> 00:32:18,180 Adam Lang: presentation for Qantas being your favorite story of the week. 611 00:32:19,710 --> 00:32:26,100 Adam Lang: Very interesting business story. He's had what, 15 years at 612 00:32:26,100 --> 00:32:26,640 Adam Lang: the helm? 613 00:32:26,730 --> 00:32:26,970 Michael Thompson: Yep. 614 00:32:28,050 --> 00:32:30,210 Adam Lang: I should say in the pilot seat, shouldn't I? And 615 00:32:30,210 --> 00:32:31,560 Adam Lang: he has... 616 00:32:31,620 --> 00:32:32,100 Sean Aylmer: Captain. 617 00:32:32,460 --> 00:32:37,259 Adam Lang: Captain. And he has done... It's an incredible company to 618 00:32:37,259 --> 00:32:42,179 Adam Lang: run, and investors, I think broadly believe he's done a 619 00:32:42,180 --> 00:32:44,790 Adam Lang: very good job. And it has been at times very 620 00:32:44,790 --> 00:32:49,350 Adam Lang: controversial, but 15 years at the top is significant. I 621 00:32:49,350 --> 00:32:51,479 Adam Lang: don't know that it can rank as my favorite though. 622 00:32:52,170 --> 00:32:55,980 Michael Thompson: But economic importance, the business significance of this. 623 00:32:56,040 --> 00:33:01,650 Adam Lang: Yes, certainly business significant. Sean, it is a great favorite 624 00:33:01,650 --> 00:33:04,860 Adam Lang: story, but it has no business impact whatsoever. 625 00:33:05,490 --> 00:33:08,070 Sean Aylmer: No, it 15,000 acres of land could have been irrigated 626 00:33:08,070 --> 00:33:09,030 Sean Aylmer: using this reservoir. 627 00:33:09,030 --> 00:33:09,540 Adam Lang: That's true. 628 00:33:09,870 --> 00:33:13,349 Sean Aylmer: And what about all the employment of the people draining 629 00:33:13,349 --> 00:33:14,009 Sean Aylmer: the reservoir? 630 00:33:15,509 --> 00:33:15,929 Adam Lang: That's true. 631 00:33:16,020 --> 00:33:19,170 Sean Aylmer: Productivity stuff like... Well, lack of productivity from the food inspector. 632 00:33:19,440 --> 00:33:22,320 Michael Thompson: I can actually hear you clutching at straws there, Sean. 633 00:33:24,030 --> 00:33:26,070 Adam Lang: I have to give this one to Michael. 634 00:33:26,160 --> 00:33:27,899 Sean Aylmer: Oh, surely not. Unfair. 635 00:33:27,990 --> 00:33:31,889 Adam Lang: I do, because 15 years running one of Australia's biggest 636 00:33:31,889 --> 00:33:35,219 Adam Lang: companies coming to an end and investors say, " I think 637 00:33:35,219 --> 00:33:37,889 Adam Lang: he's done a very good job." So I have to 638 00:33:37,889 --> 00:33:38,100 Adam Lang: give this one to Michael. 639 00:33:38,100 --> 00:33:41,070 Michael Thompson: Okay, so it's two, one. Overall. 640 00:33:41,100 --> 00:33:43,830 Sean Aylmer: Two, one. But can I make a forecast? Last week 641 00:33:44,040 --> 00:33:45,389 Sean Aylmer: we both did PBs. 642 00:33:46,469 --> 00:33:46,739 Adam Lang: Yeah. 643 00:33:47,130 --> 00:33:49,319 Sean Aylmer: This week we're going to be doing, PWs. 644 00:33:52,049 --> 00:33:58,920 Adam Lang: Has been very amusing though. So you're both tied with 66 points. 645 00:34:01,110 --> 00:34:02,940 Sean Aylmer: What an appalling weekend edition. 646 00:34:04,320 --> 00:34:07,290 Adam Lang: No. Appalling on the score, but we had a lot of fun 647 00:34:07,290 --> 00:34:07,799 Adam Lang: along the way. 648 00:34:07,799 --> 00:34:10,980 Michael Thompson: It has been very good. Excellent. I will accept the 649 00:34:10,980 --> 00:34:13,020 Michael Thompson: win. It's my first win in some time, so I 650 00:34:13,020 --> 00:34:15,420 Michael Thompson: shall be celebrating that one. Thank you very much, Adam. 651 00:34:16,890 --> 00:34:17,101 Adam Lang: Oh, thank you Michael. 652 00:34:17,101 --> 00:34:17,669 Michael Thompson: And thank you Sean. 653 00:34:17,939 --> 00:34:19,380 Sean Aylmer: Thank you. Thank you, Michael. 654 00:34:19,620 --> 00:34:21,960 Michael Thompson: Make sure you're following the podcast. Join us online as 655 00:34:21,960 --> 00:34:25,559 Michael Thompson: well, on LinkedIn, on Instagram. There's plenty going on there, at 656 00:34:25,559 --> 00:34:28,350 Michael Thompson: Twitter and Facebook. I'm Michael Thompson. Have a great weekend.