1 00:00:05,120 --> 00:00:06,520 Speaker 1: This is what the Flux. 2 00:00:06,600 --> 00:00:09,520 Speaker 2: I'm Brettan, I'm justin and it's Wednesday, the second of April. 3 00:00:09,600 --> 00:00:13,000 Speaker 1: Chusey boy, it's officially by by to Vintage Sellers and 4 00:00:13,119 --> 00:00:15,520 Speaker 1: first Choice liquor or as calls like to say they've 5 00:00:15,520 --> 00:00:18,639 Speaker 1: gone into retirement from April. They'll all co by some 6 00:00:18,880 --> 00:00:21,840 Speaker 1: version of Liquor Land, which supposedly has much better brand 7 00:00:21,840 --> 00:00:25,280 Speaker 1: awareness than the others. Seems like all liquor stores still 8 00:00:25,280 --> 00:00:30,160 Speaker 1: battling against the all mighty Dan Daniel, Dan the Man Murphy, 9 00:00:30,640 --> 00:00:31,360 Speaker 1: very true. 10 00:00:31,280 --> 00:00:33,640 Speaker 2: Man buck mamma. We saw the Reserve Bank make a 11 00:00:33,760 --> 00:00:36,440 Speaker 2: big call yesterday on the cash rate and we have 12 00:00:36,520 --> 00:00:39,240 Speaker 2: it all covered in the Flux App, including a deep 13 00:00:39,280 --> 00:00:42,519 Speaker 2: dive into what a thirty six straight mortgage might look like. 14 00:00:42,640 --> 00:00:44,559 Speaker 2: So if you're interested in what that is and how 15 00:00:44,640 --> 00:00:46,800 Speaker 2: potentially could come to Australia and make sure to check 16 00:00:46,800 --> 00:00:47,760 Speaker 2: it out in the Flux app. 17 00:00:47,800 --> 00:00:51,720 Speaker 1: Three truly inspiring stories today, Jessey boy, Let's do it 18 00:00:51,840 --> 00:00:54,920 Speaker 1: for our first. The Reserve Bank of Australia has paused 19 00:00:55,080 --> 00:00:58,280 Speaker 1: the cash rate at four point one percent because it 20 00:00:58,320 --> 00:01:00,960 Speaker 1: doesn't want to make any big moves before Donald J. 21 00:01:01,080 --> 00:01:02,000 Speaker 1: Trump's tariffs. 22 00:01:02,040 --> 00:01:04,480 Speaker 2: The RBA are certainly a cautious lot b man, so 23 00:01:04,680 --> 00:01:06,759 Speaker 2: this isn't that surprising, tell me all. 24 00:01:06,680 --> 00:01:10,080 Speaker 1: Well, juzzy boy. The RBA is obviously Australia Central Bank, 25 00:01:10,120 --> 00:01:11,600 Speaker 1: which sets the cash rate. 26 00:01:11,680 --> 00:01:13,760 Speaker 2: That's the interest rate that thanks lend to each other 27 00:01:13,959 --> 00:01:14,600 Speaker 2: for borrowing. 28 00:01:14,640 --> 00:01:16,839 Speaker 1: So when the RBA's cash rate goes up, the interest 29 00:01:16,920 --> 00:01:18,880 Speaker 1: rate on your home loan typically goes up, and when 30 00:01:18,880 --> 00:01:19,279 Speaker 1: the cash. 31 00:01:19,200 --> 00:01:21,640 Speaker 2: Rate goes down, the interest rate typically goes down. 32 00:01:21,720 --> 00:01:24,520 Speaker 1: Now, in feb the RBA cut the cash rate by 33 00:01:24,680 --> 00:01:27,920 Speaker 1: zero point two five percent, down to four point one percent. 34 00:01:27,600 --> 00:01:29,759 Speaker 2: And homeowners were shook us in a good way because 35 00:01:29,920 --> 00:01:33,199 Speaker 2: the first cash rate cut they'd enjoyed since November twenty twenty. 36 00:01:33,240 --> 00:01:35,880 Speaker 1: And now, Juzzy boy, the RBA crew have met once 37 00:01:36,000 --> 00:01:38,120 Speaker 1: more with some new members and made their big call 38 00:01:38,160 --> 00:01:38,800 Speaker 1: for April. 39 00:01:38,840 --> 00:01:41,240 Speaker 2: And despite the date being April Fool's Day, the RBA 40 00:01:41,480 --> 00:01:42,880 Speaker 2: were not clowning around. 41 00:01:42,959 --> 00:01:45,600 Speaker 1: I can confirm there were no stand up routines or 42 00:01:45,640 --> 00:01:47,560 Speaker 1: whoopy cushions on the chairs. 43 00:01:47,560 --> 00:01:51,760 Speaker 2: And no, we've dropped rates to zero percent. Just kidding, nah. 44 00:01:51,840 --> 00:01:55,320 Speaker 1: They decided to sternly and seriously pause the cash rate 45 00:01:55,360 --> 00:01:56,360 Speaker 1: at four point one percent. 46 00:01:56,400 --> 00:01:58,960 Speaker 2: The main reason they wanted to wait until Donald Trump's 47 00:01:59,000 --> 00:02:02,160 Speaker 2: global tariffs are in iplemented before making any big decision. 48 00:02:02,320 --> 00:02:05,680 Speaker 1: Yep, Trump's tariffs are supposed to come into effect. 49 00:02:05,440 --> 00:02:07,680 Speaker 2: Today, or, as he calls it, Liberation Day. 50 00:02:07,760 --> 00:02:10,760 Speaker 1: The biggest fear for many economists is that these huge 51 00:02:10,760 --> 00:02:13,400 Speaker 1: tariffs could lead to global stagflation. 52 00:02:14,080 --> 00:02:15,480 Speaker 2: So what is the key learning here? 53 00:02:15,520 --> 00:02:19,359 Speaker 1: Stagflation is when a country suffers from stagnant economic growth 54 00:02:19,400 --> 00:02:21,280 Speaker 1: and high inflation at the very same time. 55 00:02:21,440 --> 00:02:23,880 Speaker 2: It's called the terrible two yes ce juz boy. 56 00:02:23,880 --> 00:02:26,880 Speaker 1: When wages aren't rising and jobs are not booming, you'd 57 00:02:26,880 --> 00:02:29,040 Speaker 1: expect economic growth to slow down. 58 00:02:28,919 --> 00:02:31,639 Speaker 2: Because when the economy isn't doing well, people and businesses 59 00:02:31,800 --> 00:02:32,959 Speaker 2: tend to spend less. 60 00:02:33,040 --> 00:02:37,119 Speaker 1: But during stagflation, prices keep rising despite a slow economy. 61 00:02:37,160 --> 00:02:40,120 Speaker 2: The man Right now, global markets are spooked by the 62 00:02:40,160 --> 00:02:42,760 Speaker 2: potential impact of Trump's tariffs. 63 00:02:42,280 --> 00:02:45,959 Speaker 1: And investors fear that Trump's tariffs will make that nightmare real. 64 00:02:46,120 --> 00:02:47,920 Speaker 2: And then, man, we've already seen the caution in the 65 00:02:47,960 --> 00:02:50,320 Speaker 2: share market, with the NAZDAK one hundred down more than 66 00:02:50,400 --> 00:02:51,600 Speaker 2: eight percent so far. 67 00:02:51,480 --> 00:02:53,840 Speaker 1: This year, and even the ASX two hundred has been 68 00:02:53,880 --> 00:02:56,079 Speaker 1: down nearly three and a half percent this year so far. 69 00:02:56,200 --> 00:02:58,760 Speaker 2: So the man holding rate steady gives the RBA more 70 00:02:58,800 --> 00:03:00,040 Speaker 2: time to see how this plays. 71 00:02:59,840 --> 00:03:02,880 Speaker 1: Out, especially with a wildcard like the US in the mix. 72 00:03:03,440 --> 00:03:06,239 Speaker 2: For our second story, Woolies has slashed the price on 73 00:03:06,320 --> 00:03:09,120 Speaker 2: its groceries last month to close the gap on AUDI 74 00:03:09,280 --> 00:03:12,680 Speaker 2: and deflect atension from AAAK and the election campaign. 75 00:03:12,800 --> 00:03:15,360 Speaker 1: Nothing to legislate here, folks. Just a community serving, small 76 00:03:15,360 --> 00:03:17,880 Speaker 1: supermarket chain is what we are. What is going on here? 77 00:03:17,960 --> 00:03:20,640 Speaker 2: Okay? So we know that Woolies is Australia's largest supermarket 78 00:03:20,720 --> 00:03:23,680 Speaker 2: chain with nearly thirty seven percent of the grocery market. 79 00:03:23,440 --> 00:03:26,240 Speaker 1: And jusiboy, there's a Woolwortz or a Woolies Metro on 80 00:03:26,400 --> 00:03:28,440 Speaker 1: almost every single corner of this great land. 81 00:03:29,000 --> 00:03:31,560 Speaker 2: In fact, be Man Woolarts has over eleven hundred stores 82 00:03:31,600 --> 00:03:34,040 Speaker 2: across Australia. That is more than there are makers. 83 00:03:34,240 --> 00:03:37,920 Speaker 1: And while Woolies has been steadily increasing their grocery prices 84 00:03:38,080 --> 00:03:40,040 Speaker 1: over the last year or so, March was a totally 85 00:03:40,080 --> 00:03:40,800 Speaker 1: different story. 86 00:03:40,920 --> 00:03:44,200 Speaker 2: Yeah, Woolies cut their prices in March significantly. According to 87 00:03:44,280 --> 00:03:45,160 Speaker 2: JP Morgan. 88 00:03:44,960 --> 00:03:47,320 Speaker 1: The goal has been to bring the grocery price gap 89 00:03:47,440 --> 00:03:50,440 Speaker 1: with AUDI to its lowest point in two years. 90 00:03:50,520 --> 00:03:54,320 Speaker 2: Be Man Let's be honest, the timing is suspiciously convenient. 91 00:03:54,600 --> 00:03:56,880 Speaker 1: Yeah, Both Woolies and Coals are under pressure from the 92 00:03:56,920 --> 00:03:59,640 Speaker 1: AH Triple c's ongoing investigation as well. 93 00:03:59,600 --> 00:04:02,720 Speaker 2: As polics being in full crackdown on greedy corporate's mood 94 00:04:02,760 --> 00:04:03,480 Speaker 2: ahead of the election. 95 00:04:03,720 --> 00:04:07,480 Speaker 1: In particular, Woolies and colls have heard threats about legislating 96 00:04:07,520 --> 00:04:09,400 Speaker 1: against price gouging in supermarkets. 97 00:04:09,800 --> 00:04:11,240 Speaker 2: So what is the key learning here? 98 00:04:11,360 --> 00:04:14,800 Speaker 1: Supermarkets know the biggest threat to their empires isn't cheaper 99 00:04:14,840 --> 00:04:17,200 Speaker 1: toilet paper, it's tighter regulation. 100 00:04:16,839 --> 00:04:19,440 Speaker 2: And right now, be man, Woolies and coals biggest fear 101 00:04:19,640 --> 00:04:22,479 Speaker 2: is legislation that will stop them from growing market share 102 00:04:22,600 --> 00:04:23,839 Speaker 2: and growing profit margin. 103 00:04:23,960 --> 00:04:27,360 Speaker 1: There are already laws banning price fixing between supermarkets, there 104 00:04:27,360 --> 00:04:30,720 Speaker 1: are laws to ban predatory pricing that wipes out smaller competitors, 105 00:04:30,800 --> 00:04:33,840 Speaker 1: and there are also laws to stop misleading price signage. 106 00:04:33,360 --> 00:04:36,159 Speaker 2: But there's no laws stopping a supermarket from just jacking 107 00:04:36,200 --> 00:04:37,640 Speaker 2: out prices to make more profit. 108 00:04:37,720 --> 00:04:40,560 Speaker 1: That's what the government is calling price gouging. So juzzy boy, 109 00:04:40,600 --> 00:04:43,480 Speaker 1: it's no surprise that as these threats come in, Woolies 110 00:04:43,520 --> 00:04:44,880 Speaker 1: and Coals are dropping prices. 111 00:04:45,000 --> 00:04:47,400 Speaker 2: Yeah, they're now only seven point eight percent and eight 112 00:04:47,400 --> 00:04:51,239 Speaker 2: point five percent more expensive than Audi, respectively. 113 00:04:50,839 --> 00:04:54,560 Speaker 1: Down down from eleven percent plus just last year. That's 114 00:04:54,560 --> 00:04:56,000 Speaker 1: according to JP Morgan. 115 00:04:56,120 --> 00:04:58,600 Speaker 2: So now it's all about the optics for the supermarkets, 116 00:04:58,680 --> 00:05:00,800 Speaker 2: keeping things look in friendly fair. 117 00:05:00,960 --> 00:05:04,640 Speaker 1: For our third and final story, open ai has announced 118 00:05:04,680 --> 00:05:08,040 Speaker 1: that it's closed the largest round of capital ever raised 119 00:05:08,040 --> 00:05:12,599 Speaker 1: by a private company, pocketing a tasty forty billion US dollars. 120 00:05:12,640 --> 00:05:14,720 Speaker 2: Wow, they've raised more than the whole value of Telstra 121 00:05:14,839 --> 00:05:17,360 Speaker 2: in just one afternoon, b Man, so tell me more well. 122 00:05:17,400 --> 00:05:20,920 Speaker 1: Open Ai launched in twenty fifteen as a nonprofit research 123 00:05:21,120 --> 00:05:24,360 Speaker 1: lab that focused on exploring AI and ensuring it benefited 124 00:05:24,400 --> 00:05:25,240 Speaker 1: all of humanity. 125 00:05:25,320 --> 00:05:27,480 Speaker 2: In twenty twenty two, b Man open Ai launched its 126 00:05:27,520 --> 00:05:32,159 Speaker 2: now famous chatbot, chatchapt, which revolutionized how everyone did things 127 00:05:32,520 --> 00:05:35,920 Speaker 2: like applying for jobs, like getting travel tips, like writing 128 00:05:36,000 --> 00:05:39,880 Speaker 2: university essays. In fact, be Man chatchpt became the fastest 129 00:05:39,880 --> 00:05:43,200 Speaker 2: growing consumer app ever, hitting one hundred million users in 130 00:05:43,320 --> 00:05:44,520 Speaker 2: just two months. 131 00:05:44,200 --> 00:05:47,360 Speaker 1: And now chatchpt has more than five hundred million weekly 132 00:05:47,640 --> 00:05:50,560 Speaker 1: users and open ai has become a household name. 133 00:05:50,720 --> 00:05:53,880 Speaker 2: So now open AI's raised forty billion US dollars, which 134 00:05:54,000 --> 00:05:57,240 Speaker 2: values the company at three hundred billion US dollars. 135 00:05:57,040 --> 00:05:59,520 Speaker 1: And Jullie Boyd. This has become the largest ever round 136 00:05:59,520 --> 00:06:02,360 Speaker 1: of capital raised, more than triple the previous record. 137 00:06:02,440 --> 00:06:04,880 Speaker 2: But be Man. Because of the unique structure of open 138 00:06:04,920 --> 00:06:08,359 Speaker 2: ai as part four profit and part nonprofit, the shares 139 00:06:08,360 --> 00:06:10,839 Speaker 2: are expected to be issued as convertible notes. 140 00:06:11,160 --> 00:06:12,160 Speaker 1: So what's okay learning here? 141 00:06:12,200 --> 00:06:14,640 Speaker 2: A convertible note is essentially a load that can be 142 00:06:14,640 --> 00:06:17,120 Speaker 2: converted into shares of the company at a later date. 143 00:06:17,279 --> 00:06:20,520 Speaker 1: There are specific events that cause the convertible note to 144 00:06:20,600 --> 00:06:23,120 Speaker 1: convert into equity. In this case, the condition is when 145 00:06:23,160 --> 00:06:27,120 Speaker 1: open ai converts into a four profit structure, which must 146 00:06:27,160 --> 00:06:28,680 Speaker 1: happen by the end of twenty twenty five. 147 00:06:28,720 --> 00:06:31,120 Speaker 2: In fact, be Man, open Ai will only receive ten 148 00:06:31,240 --> 00:06:32,480 Speaker 2: billion US dollars. 149 00:06:32,240 --> 00:06:34,720 Speaker 1: Up front, and if they're unable to convert to a 150 00:06:34,800 --> 00:06:37,960 Speaker 1: for profit structure, this forty bill may end up being 151 00:06:38,080 --> 00:06:38,919 Speaker 1: just twenty bill. 152 00:06:39,040 --> 00:06:41,279 Speaker 2: Just twenty bill. Flexam, have you ever heard about the 153 00:06:41,360 --> 00:06:44,359 Speaker 2: thirty year fixed strate mortgage? It is very hot in 154 00:06:44,400 --> 00:06:47,200 Speaker 2: the US, but it doesn't exist in Australia yet. We 155 00:06:47,320 --> 00:06:49,280 Speaker 2: break it down in the flux app what it is, 156 00:06:49,320 --> 00:06:51,400 Speaker 2: how it's used, and why it might be useful to 157 00:06:51,400 --> 00:06:53,159 Speaker 2: have in Australia as well. To make sure to download 158 00:06:53,200 --> 00:06:54,400 Speaker 2: the Flux app to check it out. 159 00:06:54,440 --> 00:06:56,840 Speaker 1: Thanks for listening and we'll see you on Friday.