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Speaker 1: This is what the flux.

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Speaker 2: I'm Brett and I'm justin and it's Wednesday, the twenty

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Speaker 2: sixth of March.

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Speaker 1: Juzzy Boy. Meta already offers an ad free non data

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Speaker 1: tracking subsequent for Facebook and for Instagram, and that's in Europe,

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Speaker 1: but now they may offer the same in the United

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Speaker 1: Kingdom as well. As we know in tech juzzy Boy,

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Speaker 1: if you're not paying for the product, then you are

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Speaker 1: the product. And this might give UK users the option

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Speaker 1: to choose. And if it takes off in the UK,

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Speaker 1: certainly amount of time before it comes to Australia too,

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Speaker 1: you would think I will.

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Speaker 2: Be paying for that service, be man, fluxam. With the

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Speaker 2: federal budget dropping last night, we have a heap of

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Speaker 2: content in the Flux app tracking the winners, the losers

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Speaker 2: and everything in between for the federal budget. So if

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Speaker 2: you want to know where the spending's going, how much

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Speaker 2: it is, make sure to check out the Flux app

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Speaker 2: for all the details.

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Speaker 1: Three impactful stories today, juzzy Boy, let's do it for

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Speaker 1: our first, the Labor Government dropped their twenty twenty five

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Speaker 1: budget last night with some big investments and either bigger

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Speaker 1: deficits if they get re elected.

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Speaker 2: The old pre election spending is freeb Man, So tell

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Speaker 2: me what's going on.

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Speaker 1: Juzzy boy. Each year in March, the government drops its

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Speaker 1: annual budget for Australia's spending.

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Speaker 2: It's a bit like your personal budget, except we're talking

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Speaker 2: billions and billions in annual income from.

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Speaker 1: Personal income tax, payroll tax, corporate tax and Bman.

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Speaker 2: It also includes billions and billions of dollars in government

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Speaker 2: spending across health care and infrastructure and education and childcare

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Speaker 2: and a whole lot more.

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Speaker 1: And as part of this budget, the Labor government has

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Speaker 1: really pushed hard on healthcare.

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Speaker 2: It announced an eight and a half billion dollar investment

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Speaker 2: into Medicare.

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Speaker 1: With the goal for an increase in the number of

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Speaker 1: bulk bill doctor consultations.

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Speaker 2: They also announced a twenty percent cut of hex help

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Speaker 2: debts to ease the cost of living pressures.

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Speaker 1: And let's not forget a fifteen billion dollar investment into

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Speaker 1: childcare subsidies.

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Speaker 2: And be Man. With all these big investments, the Labor

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Speaker 2: government has warned that this election will run into.

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Speaker 1: A deficit after two years of budget surpluses.

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Speaker 2: So Beman, despite running a loss in this budget, this

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Speaker 2: doesn't come as such a surprise. Because Australia runs a structural.

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Speaker 1: Interesting so what is the key learning here?

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Speaker 2: A structural deficit is when the government budget is permanently

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Speaker 2: making a loss, even during good times.

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Speaker 1: That means that even when the employment rate is high,

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Speaker 1: consumer spending is high, and the economy is performing well,

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Speaker 1: we'd likely have a deficit.

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Speaker 2: And a Man. The Australian budget has been in structural

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Speaker 2: deficit for nearly twenty years.

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Speaker 1: Which tells us the issue isn't just short term spending.

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Speaker 2: Nope, it's more deeply embedded in how the budget is

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Speaker 2: actually built.

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Speaker 1: But interestingly, the two previous budgets have been in surplus.

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Speaker 2: And that's mainly been due to the economy actually performing well.

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Speaker 1: Above average, meaning higher tax receipts for the government and

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Speaker 1: lower welfare payments.

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Speaker 2: But be Man. With this election budget, Labour's going after

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Speaker 2: some big ticket spending.

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Speaker 1: Medicare, HEXTA and childcare, so we're back in deficit territory.

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Speaker 2: And bemaned the US, The UK, France and Italy.

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Speaker 1: Are also in structural deficits too, and unless structural changes

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Speaker 1: are made like cutting spending or boosting long term revenue,

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Speaker 1: the deficits are likely to stick around for.

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Speaker 2: Our second story. Twenty three and meters, the genetic tear

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Speaker 2: testing company, has filed for bankruptcy in the US as

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Speaker 2: it tries to sell its assets, including its highly confidential

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Speaker 2: customer gene data. Genetic secrets maybe up for grabs here

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Speaker 2: it just boy, so tell me more. Hey so. Twenty

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Speaker 2: three and Me is a personal genetic testing company that

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Speaker 2: was founded back in two thousand and six.

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Speaker 1: It was the first company around the world to offer

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Speaker 1: direct to consume a genetic testing.

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Speaker 2: And that was in two thousand and seven. You know

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Speaker 2: spin in the test tube. Send you slided back to

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Speaker 2: twenty three and me, and they can tell you a

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Speaker 2: whole host of things about your DNA.

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Speaker 1: It would appear that I am twelve percent Italian, somehow

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Speaker 1: related to a goat herder, and I'm three percent Viking.

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Speaker 2: They can also.

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Speaker 1: Show you your racial background split and a genealogical family tree,

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Speaker 1: which thousands of people have used to track down their

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Speaker 1: long lost third cousins on the other side of the world.

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Speaker 1: And given that twenty three and me holds this very

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Speaker 1: unique DNA, strong data privacy has been a key to

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Speaker 1: its business that've.

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Speaker 2: Been in over the past few years, twenty three and

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Speaker 2: Me has struggled to find a profitable business.

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Speaker 1: Model, particularly since going public in twenty twenty one.

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Speaker 2: So now it has filed for Chapter eleven bankruptcy in

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Speaker 2: the US and he's looking to sell substantially all of

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Speaker 2: its assets.

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Speaker 1: Including its highly, highly, highly confidential data. Did I say highly?

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Speaker 2: So what is the key landing here?

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Speaker 1: In today's economy, data is often referred to as the

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Speaker 1: new oil.

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Speaker 2: And companies like twenty three meters have built entire business

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Speaker 2: models around collecting the data, analyzing the data, and of

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Speaker 2: course monetizing the data.

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Speaker 1: Sometimes it can be used for research with pharmaceutical companies

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Speaker 1: or even advertising partnership.

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Speaker 2: But in tough times that confidential data can become part

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Speaker 2: of the liquidation process.

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Speaker 1: Just like office chairs or lab equipment, so for.

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Speaker 2: Customers be man this can become a serious privacy risk.

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Speaker 2: We've also seen risks of sensitive data being shared in

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Speaker 2: Australia recently.

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Speaker 1: Remember when hacker stole the personal info of Medibank customers.

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Speaker 2: Yep names, contact information and health records of nearly ten

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Speaker 2: million current and former Medibank customers.

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Speaker 1: So Jazi boy, It's a reminder that sharing a confidential

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Speaker 1: data with any company carries big risks.

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Speaker 2: For our third and final story, James Hardy, the ASX

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Speaker 2: listed global building materials company, has seen its share price

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Speaker 2: play after a fourteen billion dollar acquisition of arrivals.

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Speaker 1: Like nervously introducing a new partner to your friends and

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Speaker 1: getting the disapproving look. So what is going on here?

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Speaker 2: Okay? So James Hardy is the twenty billion dollar Australian

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Speaker 2: buildings material company. We'd been talking external clouding as well,

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Speaker 2: cement sheets, insulation pipes, all.

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Speaker 1: The stuff you plant to buy from Bunnings but then

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Speaker 1: leave to the experts. And if you've heard the name

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Speaker 1: James Hardy before, it might be because it used to

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Speaker 1: manufacture app products containing a spestos.

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Speaker 2: Which led to many, many, many lawsuits.

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Speaker 1: But now juzzy boy James Hardy has announced the acquisition

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Speaker 1: of a rival named Azak for fourteen billion dollars.

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Speaker 2: They make sustainable outdoor living products like decking and railing.

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Speaker 1: And this acquisition was a cash and script deal that

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Speaker 1: valued Azak add a more than thirty seven percent premium

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Speaker 1: to its last closing share price.

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Speaker 2: Next minute, James Hardi's share price plummeted more than fourteen

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Speaker 2: percent and it was clear that the invested disapproval was real.

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Speaker 2: So what is the key learning here in m and

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Speaker 2: A bigger is it always better, especially when the market

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Speaker 2: sees more risk than awar. So when they pulled the

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Speaker 2: trigger on a mega acquisition, investors were a tad spook.

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Speaker 2: And why was that? Be Man?

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Speaker 1: Because these kinds of transformational deals, as they call it,

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Speaker 1: often over promise and underdeliver.

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Speaker 2: Yeh, be Man. This deals already raised red flags to

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Speaker 2: James Hardy investors because the price is steep.

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Speaker 1: Yep forty times Azex's net profit.

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Speaker 2: Which is much higher than James Hardy's current valuation of

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Speaker 2: twenty times.

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Speaker 1: Its net profit and success relies on integration between James

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Speaker 1: Hardy and AAAC.

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Speaker 2: They're expecting three hundred and fifty million dollars in synergies

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Speaker 2: from the acquisition.

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Speaker 1: We choose ambitions, so clearly James Hardy's investors are voting

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Speaker 1: with their feet and their wallets.

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Speaker 2: Foxam. If you want to learn more about the federal

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Speaker 2: budget and the investment in healthcare, the investment in childcare,

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Speaker 2: and the investment in education, we have it all covered

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Speaker 2: with short, fite sides and easy to understand articles and

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Speaker 2: videos in the flux Oup. Make sure to check it

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Speaker 2: out for the latest scoop.

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Speaker 1: Thanks for listening, and we'll see you on Friday.