1 00:00:03,200 --> 00:00:06,000 Speaker 1: Good morning, and welcome to the Daily os. It's Thursday, 2 00:00:06,120 --> 00:00:09,039 Speaker 1: the sixth of May. My name is Sam Kozlowski, and 3 00:00:09,119 --> 00:00:12,280 Speaker 1: helping me make sense of today's news is Zara Sideline. 4 00:00:12,640 --> 00:00:16,239 Speaker 1: Making news today. Un condemns Columbia. 5 00:00:15,880 --> 00:00:18,360 Speaker 2: Violence, Trump launches a new blog. 6 00:00:18,320 --> 00:00:20,760 Speaker 1: Some good news about ocean conservation, and a. 7 00:00:20,720 --> 00:00:23,880 Speaker 2: Look at the stock market. Here's today's Daily Digest. 8 00:00:25,440 --> 00:00:28,880 Speaker 1: The United Nations has condemned the violent repression of protesters 9 00:00:28,920 --> 00:00:32,640 Speaker 1: in Colombia after eighteen people were reported dead, eight hundred injured, 10 00:00:32,640 --> 00:00:36,760 Speaker 1: and eighty seven people reported missing. A human rights spokesperson said, 11 00:00:36,840 --> 00:00:40,000 Speaker 1: we are deeply alarmed at developments in Cali overnight, where 12 00:00:40,000 --> 00:00:42,880 Speaker 1: police opened fire on demonstrators and a number of people 13 00:00:42,880 --> 00:00:46,000 Speaker 1: were killed and injured. The protests were triggered by an 14 00:00:46,040 --> 00:00:49,360 Speaker 1: unpopular tax reform that would have increased taxes on individuals 15 00:00:49,360 --> 00:00:51,959 Speaker 1: and businesses amid the COVID nineteen pandemic. 16 00:00:53,280 --> 00:00:55,440 Speaker 2: It's been a while since we've spoken about him, but 17 00:00:55,680 --> 00:00:59,000 Speaker 2: former US President Donald Trump has launched a blog style 18 00:00:59,080 --> 00:01:02,320 Speaker 2: website after being banned from Facebook and Twitter. One of 19 00:01:02,360 --> 00:01:05,400 Speaker 2: the posts that we saw read, so nice to see rhino. 20 00:01:05,640 --> 00:01:08,720 Speaker 2: So that's Republican in name only. Mitt Romney Boot off 21 00:01:08,760 --> 00:01:12,400 Speaker 2: the stage at the Utah Republican State Convention. A few 22 00:01:12,440 --> 00:01:15,520 Speaker 2: hours later, he appeared in an interview with conservative activist 23 00:01:15,560 --> 00:01:18,399 Speaker 2: and radio host Candorce Owens, where he hinted at a 24 00:01:18,400 --> 00:01:22,000 Speaker 2: potential election bid in twenty twenty four, saying the answer 25 00:01:22,080 --> 00:01:24,680 Speaker 2: is I'm absolutely enthused. I look forward to doing an 26 00:01:24,680 --> 00:01:26,120 Speaker 2: announcement at the right time. 27 00:01:27,680 --> 00:01:30,600 Speaker 1: The federal government will deliver on a key recommendation made 28 00:01:30,640 --> 00:01:34,480 Speaker 1: in the Royal Commission International Natural Disaster Arrangements by investing 29 00:01:34,520 --> 00:01:38,240 Speaker 1: six hundred million dollars into a new national agency. The 30 00:01:38,319 --> 00:01:41,760 Speaker 1: National Recovery and Resilience Agency will receive the investment in 31 00:01:41,800 --> 00:01:44,360 Speaker 1: the budget next week, with hopes to assist communities in 32 00:01:44,400 --> 00:01:47,680 Speaker 1: responding to natural disasters and improve resilience in the face 33 00:01:47,720 --> 00:01:48,680 Speaker 1: of climate change. 34 00:01:50,120 --> 00:01:52,720 Speaker 2: To the good news, the federal government has announced an 35 00:01:52,720 --> 00:01:56,680 Speaker 2: one hundred million dollar initiative for ocean conservation. PM Scott 36 00:01:56,680 --> 00:01:59,200 Speaker 2: Morrison said, and I quote this investment will boost the 37 00:01:59,240 --> 00:02:02,040 Speaker 2: seagrass and me angros that will help cut emissions. It'll 38 00:02:02,080 --> 00:02:05,280 Speaker 2: mean cleaner beaches, better protection for turtles and seabirds, and 39 00:02:05,360 --> 00:02:08,480 Speaker 2: help for coastal and indigenous communities reliant on the ocean. 40 00:02:10,080 --> 00:02:12,679 Speaker 2: A couple of weeks ago on our Instagram page, The 41 00:02:12,760 --> 00:02:15,400 Speaker 2: Daily OS, we put up a pole that asked whether 42 00:02:15,440 --> 00:02:19,040 Speaker 2: our audience wanted market updates every day, and the answers 43 00:02:19,080 --> 00:02:21,520 Speaker 2: to that was a resounding yes. But we also got 44 00:02:21,520 --> 00:02:23,880 Speaker 2: a lot of responses from people saying that they just 45 00:02:23,880 --> 00:02:26,240 Speaker 2: wanted a bit more of a foundation of knowledge about 46 00:02:26,240 --> 00:02:29,040 Speaker 2: what the stock market actually is before they were going 47 00:02:29,080 --> 00:02:32,239 Speaker 2: to be able to access those market updates. So today 48 00:02:32,280 --> 00:02:34,440 Speaker 2: we wanted to take you through what the stock market 49 00:02:34,560 --> 00:02:36,440 Speaker 2: actually is and why it matters to you. 50 00:02:37,000 --> 00:02:39,280 Speaker 1: Before we get going, let's clear up a little bit 51 00:02:39,320 --> 00:02:42,799 Speaker 1: of confusion. The share market and the stock market are 52 00:02:42,840 --> 00:02:45,480 Speaker 1: actually the same thing, So forgive me if I use 53 00:02:45,560 --> 00:02:49,399 Speaker 1: the terms interchangeably in this chat. In Australia we tend 54 00:02:49,400 --> 00:02:51,839 Speaker 1: to use share market, and in the US you'll hear 55 00:02:51,880 --> 00:02:53,200 Speaker 1: stock market a lot more. 56 00:02:53,600 --> 00:02:55,280 Speaker 2: So let's start at the very basics. 57 00:02:55,520 --> 00:02:56,240 Speaker 1: What is a share? 58 00:02:56,320 --> 00:02:58,200 Speaker 2: You talk about it all day every day, it's your 59 00:02:58,240 --> 00:02:59,320 Speaker 2: favorite thing to discuss. 60 00:02:59,520 --> 00:03:02,320 Speaker 1: What is a show? A share is basically a single 61 00:03:02,480 --> 00:03:05,400 Speaker 1: unit of ownership in a company. So if you own 62 00:03:05,639 --> 00:03:10,000 Speaker 1: one share in Tesla, you actually own one portion of Tesla. 63 00:03:10,760 --> 00:03:13,920 Speaker 1: That single share unit has a value depending on the 64 00:03:13,919 --> 00:03:18,320 Speaker 1: company's value and success. The more successful the company, and 65 00:03:18,360 --> 00:03:21,520 Speaker 1: that's often indicated by revenue, the higher the price of 66 00:03:21,560 --> 00:03:22,400 Speaker 1: your share will be. 67 00:03:22,919 --> 00:03:25,320 Speaker 2: So if a share is a single portion of a company, 68 00:03:25,400 --> 00:03:27,760 Speaker 2: is the share market then where one can go and 69 00:03:27,800 --> 00:03:29,959 Speaker 2: buy and sell shares exactly? 70 00:03:30,040 --> 00:03:33,560 Speaker 1: It's the share exchange. In Australia, the primary place we 71 00:03:33,639 --> 00:03:36,840 Speaker 1: sell and buy shares is the Australian Securities Exchange or 72 00:03:36,880 --> 00:03:40,440 Speaker 1: the AX. The stock market is not one specific website 73 00:03:40,560 --> 00:03:42,800 Speaker 1: someone can go to. It's not found on an app 74 00:03:42,800 --> 00:03:45,800 Speaker 1: on a phone. It's not a physical space. It's the 75 00:03:45,880 --> 00:03:48,760 Speaker 1: term we give the framework that shares are bought and sold. 76 00:03:49,280 --> 00:03:51,960 Speaker 1: The market isn't open like the foreign exchange market all 77 00:03:52,000 --> 00:03:54,880 Speaker 1: the time. The AX is open Monday to Friday ten 78 00:03:54,920 --> 00:03:58,440 Speaker 1: to four. Outside of these times, you can't trade your stocks. 79 00:03:58,920 --> 00:04:02,080 Speaker 2: So hypothetically and I know that this would never happen, 80 00:04:02,240 --> 00:04:05,480 Speaker 2: but if say the government put out a really late 81 00:04:05,600 --> 00:04:08,560 Speaker 2: night press release that they were shutting down all minds 82 00:04:08,560 --> 00:04:11,880 Speaker 2: in the country, what would happen to the shares of 83 00:04:12,040 --> 00:04:14,880 Speaker 2: a major mining company. And does that mean that if 84 00:04:14,920 --> 00:04:17,000 Speaker 2: it was after the times you just said, you wouldn't 85 00:04:17,000 --> 00:04:19,039 Speaker 2: be able to buy or sell stocks in that company. 86 00:04:19,400 --> 00:04:21,120 Speaker 1: So we'd get a good idea of what was going 87 00:04:21,200 --> 00:04:24,360 Speaker 1: to happen before the ten am open. With a sort 88 00:04:24,360 --> 00:04:28,000 Speaker 1: of indicative price of a pre open range, it'll be 89 00:04:28,000 --> 00:04:30,480 Speaker 1: an indication of how much demands there is for people 90 00:04:30,520 --> 00:04:32,320 Speaker 1: who want to buy the stocks or who want to 91 00:04:32,360 --> 00:04:35,560 Speaker 1: sell the stocks. But nothing can actually happen until that 92 00:04:35,600 --> 00:04:38,760 Speaker 1: ten am mark where the mining stocks would open at. 93 00:04:38,800 --> 00:04:41,240 Speaker 1: You'd presume a much lower price than they were the 94 00:04:41,240 --> 00:04:45,640 Speaker 1: previous day because suddenly their market opportunity would have been 95 00:04:45,680 --> 00:04:48,599 Speaker 1: restricted greatly. That leads us into thinking about why the 96 00:04:48,640 --> 00:04:51,719 Speaker 1: price of shares change. I think it's really important to 97 00:04:51,760 --> 00:04:54,640 Speaker 1: think about the answers to that in two ways. One 98 00:04:55,000 --> 00:04:58,960 Speaker 1: is market wide trends and two is company specific trends. 99 00:05:00,000 --> 00:05:02,799 Speaker 1: A market wide trend would be something like a pandemic 100 00:05:03,360 --> 00:05:06,839 Speaker 1: or a government announcement that affects all the stocks. It 101 00:05:06,880 --> 00:05:10,120 Speaker 1: affects how investors are feeling about the future. We see 102 00:05:10,240 --> 00:05:13,520 Speaker 1: major crashes in the stock market after a terror attack, 103 00:05:13,839 --> 00:05:16,920 Speaker 1: after a natural disaster because it really impacts the way 104 00:05:16,960 --> 00:05:20,800 Speaker 1: that people perceive their own wealth. On a more company 105 00:05:20,800 --> 00:05:24,640 Speaker 1: specific level, this is things like a company announcement about 106 00:05:24,640 --> 00:05:28,159 Speaker 1: a new market they're entering into a new product. Perhaps 107 00:05:28,160 --> 00:05:30,320 Speaker 1: if they're a medical company, and they do some testing 108 00:05:30,520 --> 00:05:33,679 Speaker 1: the results of those tests, and that's information that actually 109 00:05:33,720 --> 00:05:35,920 Speaker 1: has to be reported to the market. The companies don't 110 00:05:35,960 --> 00:05:38,440 Speaker 1: have a choice as part of their obligations of being 111 00:05:38,480 --> 00:05:41,520 Speaker 1: publicly listed, so the ability for people to buy and sell, 112 00:05:42,040 --> 00:05:44,400 Speaker 1: they have to tell the market when big stuff happens. 113 00:05:45,040 --> 00:05:46,920 Speaker 2: So I hear a lot of people in my life 114 00:05:47,000 --> 00:05:50,120 Speaker 2: talking about shares and talking about wanting to invest in 115 00:05:50,200 --> 00:05:52,800 Speaker 2: shares and buy and train all of this stuff, and 116 00:05:52,839 --> 00:05:55,440 Speaker 2: it can get a bit overwhelming for someone that is 117 00:05:55,520 --> 00:05:58,559 Speaker 2: not in that world. So can you just explain really 118 00:05:58,640 --> 00:06:02,240 Speaker 2: clearly and really simply why people invest in shares and 119 00:06:02,279 --> 00:06:02,919 Speaker 2: in companies. 120 00:06:03,120 --> 00:06:05,839 Speaker 1: There's a phrase that financial advisors often use of making 121 00:06:05,880 --> 00:06:09,160 Speaker 1: your money work for you. So at the moment in Australia, 122 00:06:09,200 --> 00:06:11,640 Speaker 1: we have very low interest rates, which means that the 123 00:06:11,640 --> 00:06:14,760 Speaker 1: money that's sitting in your bank account isn't actually maturing 124 00:06:15,160 --> 00:06:18,880 Speaker 1: into a greater amount at a very fast rate. Instead, 125 00:06:19,240 --> 00:06:21,240 Speaker 1: people are looking to use the money that they've earned 126 00:06:21,279 --> 00:06:24,159 Speaker 1: from their jobs and make that money grow so that 127 00:06:24,240 --> 00:06:26,120 Speaker 1: they can use a lot more of it later to 128 00:06:26,120 --> 00:06:29,440 Speaker 1: buy really big life assets like a home. By investing 129 00:06:29,480 --> 00:06:33,640 Speaker 1: in companies that we all think has major growth potential. 130 00:06:34,080 --> 00:06:36,080 Speaker 1: The aim is that your money will work for you 131 00:06:36,120 --> 00:06:39,400 Speaker 1: while you're sleeping, while you're working, and while you're eating. 132 00:06:39,680 --> 00:06:43,240 Speaker 1: That's ultimately why people invest in stocks is to grow 133 00:06:43,279 --> 00:06:45,680 Speaker 1: their net wealth over a period of time. Of course, 134 00:06:45,720 --> 00:06:48,560 Speaker 1: there's huge risks with that. Nothing is guaranteed and even 135 00:06:48,600 --> 00:06:51,160 Speaker 1: experts get it wrong. But what I think is really 136 00:06:51,200 --> 00:06:55,800 Speaker 1: important is financial literacy and education. It's understanding how this 137 00:06:55,880 --> 00:06:58,760 Speaker 1: all works so that you don't feel like people are 138 00:06:58,760 --> 00:07:01,799 Speaker 1: moving on around you, actually feeling like you're in control 139 00:07:02,200 --> 00:07:06,479 Speaker 1: of your financial decisions and investing in our future. The 140 00:07:06,560 --> 00:07:09,160 Speaker 1: things we've talked about on this podcast is for general 141 00:07:09,160 --> 00:07:12,760 Speaker 1: information only. It shouldn't be taken as investing professional advice. 142 00:07:13,880 --> 00:07:15,840 Speaker 2: That is all we have time for today. But in 143 00:07:15,880 --> 00:07:18,400 Speaker 2: the meantime, follow the day's news on Instagram at the 144 00:07:18,480 --> 00:07:21,480 Speaker 2: Daily os. It's where over one hundred thousand Australians get 145 00:07:21,520 --> 00:07:23,440 Speaker 2: their news throughout the day and we'd love you to 146 00:07:23,520 --> 00:07:29,200 Speaker 2: become part of the community.