1
00:00:00,320 --> 00:00:03,440
Speaker 1: Good morning everybody, and welcome to the Daily OS. It

2
00:00:03,520 --> 00:00:07,040
Speaker 1: is Wednesday, the twenty second of September, a hump day.

3
00:00:07,480 --> 00:00:11,280
Speaker 1: Yesterday there were massive protests in Melbourne, with at least

4
00:00:11,320 --> 00:00:14,800
Speaker 1: forty four anti lockdown protesters arrested. We're going to cover

5
00:00:14,920 --> 00:00:17,319
Speaker 1: that and then I'm going to have a chat to

6
00:00:17,400 --> 00:00:21,439
Speaker 1: Mariah about the latest economic crisis evolving out of China.

7
00:00:22,079 --> 00:00:24,200
Speaker 1: It's one of those chats where we're going to try

8
00:00:24,239 --> 00:00:26,439
Speaker 1: and set up what you need to know as this

9
00:00:26,640 --> 00:00:29,720
Speaker 1: evolves in the next couple of days around the country.

10
00:00:29,800 --> 00:00:32,879
Speaker 1: Yesterday there were six hundred and three new cases of

11
00:00:32,920 --> 00:00:36,280
Speaker 1: COVID nineteen in Victoria, New South Wales was back over

12
00:00:36,360 --> 00:00:39,239
Speaker 1: one thousand at oneenty and twenty two, and in the

13
00:00:39,240 --> 00:00:42,640
Speaker 1: Act there were sixteen. Zara, tell me more about this

14
00:00:42,800 --> 00:00:44,080
Speaker 1: protest in Melbourne.

15
00:00:44,360 --> 00:00:47,239
Speaker 2: So there were some pretty confronting images coming out of

16
00:00:47,280 --> 00:00:51,559
Speaker 2: Melbourne yesterday as hundreds of people protested throughout the CBD,

17
00:00:52,120 --> 00:00:54,640
Speaker 2: and we know that they were protesting against the mandatory

18
00:00:54,720 --> 00:00:59,440
Speaker 2: COVID nineteen vaccines for construction workers. Riot police were present

19
00:00:59,440 --> 00:01:02,600
Speaker 2: at the protests as the people, many of whom identified

20
00:01:02,680 --> 00:01:07,000
Speaker 2: as construction workers, marched along Victoria Street towards Parliament House.

21
00:01:07,480 --> 00:01:10,280
Speaker 2: The previous night, the Andrews government had announced a two

22
00:01:10,280 --> 00:01:14,280
Speaker 2: week snap lockdown for the construction industry in Victoria, and

23
00:01:14,319 --> 00:01:17,840
Speaker 2: that was because of significant transmission on building sites as

24
00:01:17,840 --> 00:01:21,360
Speaker 2: well as some compliance issues across the construction sector.

25
00:01:22,360 --> 00:01:25,520
Speaker 1: Northern New South Wales has become the latest pocket of

26
00:01:25,600 --> 00:01:29,800
Speaker 1: COVID cases, with the Byron, Tweed and Kempsey Shires entering

27
00:01:29,840 --> 00:01:33,000
Speaker 1: a seven day lockdown yesterday after a positive case of

28
00:01:33,040 --> 00:01:37,040
Speaker 1: COVID visited the community. Stay at home orders will apply

29
00:01:37,160 --> 00:01:40,000
Speaker 1: to anyone who has been to KEMPSI since September fourteenth

30
00:01:40,360 --> 00:01:43,319
Speaker 1: and to Byron and Tweed since the eighteenth of September.

31
00:01:43,720 --> 00:01:47,720
Speaker 2: Canadian Prime Minister Justin Trudeau will continue his reign after

32
00:01:47,840 --> 00:01:51,280
Speaker 2: securing a third term in office. Following the election, It's

33
00:01:51,320 --> 00:01:55,600
Speaker 2: expected that Trudeau's government will remain a minority government. Trudeau

34
00:01:55,640 --> 00:01:58,560
Speaker 2: called the election two years into his current four year

35
00:01:58,640 --> 00:02:01,200
Speaker 2: term and that was about two years early in hopes

36
00:02:01,240 --> 00:02:04,720
Speaker 2: of securing a parliamentary majority. It does look though, as

37
00:02:04,720 --> 00:02:07,160
Speaker 2: if he won't be able to achieve that this time around.

38
00:02:08,360 --> 00:02:11,400
Speaker 1: And your Wednesday good news. Military service members in the

39
00:02:11,520 --> 00:02:14,919
Speaker 1: US who were discharged due to their sexual orientation, gender

40
00:02:14,960 --> 00:02:18,920
Speaker 1: identity or HIV status are now eligible to receive all

41
00:02:19,080 --> 00:02:22,960
Speaker 1: veterans affairs benefits. The guidance was announced during an event

42
00:02:23,040 --> 00:02:25,520
Speaker 1: held for the tenth anniversary of the repeal of the

43
00:02:25,600 --> 00:02:33,600
Speaker 1: DNAs Don't tell policy. Ladies and gentlemen of podcast Land,

44
00:02:33,639 --> 00:02:37,000
Speaker 1: I'd like to introduce you to a Chinese conglomerate property

45
00:02:37,000 --> 00:02:42,320
Speaker 1: company called Evergrand. They have dominated headlines after the company

46
00:02:42,360 --> 00:02:45,959
Speaker 1: warned once again that it could default on its astronomical

47
00:02:46,000 --> 00:02:50,400
Speaker 1: debt levels because of an evolving crisis in China. That

48
00:02:50,520 --> 00:02:52,440
Speaker 1: is a lot to take in For a Wednesday morning,

49
00:02:52,560 --> 00:02:56,120
Speaker 1: I am joined by Maria Laddis, journalist with the Daily OS,

50
00:02:56,200 --> 00:02:59,680
Speaker 1: to try and break down this story. Mariah, let's start

51
00:02:59,680 --> 00:03:02,480
Speaker 1: at the very beginning. What is Evergrand?

52
00:03:03,280 --> 00:03:06,359
Speaker 3: So, as you said, Sam, Evergrand is a property developer

53
00:03:06,480 --> 00:03:09,760
Speaker 3: in China. It is the second largest in the country,

54
00:03:10,200 --> 00:03:13,720
Speaker 3: and the real estate giant employs over two hundred thousand

55
00:03:13,760 --> 00:03:17,320
Speaker 3: people and sustains a further three point eight million jobs

56
00:03:17,360 --> 00:03:20,800
Speaker 3: in related industries that it works with. As the company

57
00:03:20,840 --> 00:03:25,560
Speaker 3: grew rapidly, it grew alongside China's housing market boom, and

58
00:03:25,800 --> 00:03:28,639
Speaker 3: in order to keep up with that growth, Evergrant had

59
00:03:28,680 --> 00:03:31,480
Speaker 3: to take out numerous loans in order to meet that

60
00:03:31,600 --> 00:03:34,440
Speaker 3: demand of that boom of the property market.

61
00:03:34,800 --> 00:03:37,320
Speaker 1: So you've got a booming property company in China that

62
00:03:37,480 --> 00:03:41,520
Speaker 1: is building apartment after apartment for a new class of

63
00:03:41,640 --> 00:03:45,320
Speaker 1: people who can afford to live in homes across the country.

64
00:03:45,960 --> 00:03:47,880
Speaker 1: Where did it all go so wrong for them?

65
00:03:48,000 --> 00:03:51,880
Speaker 3: So with that debt, and we're talking four hundred billion

66
00:03:52,000 --> 00:03:55,600
Speaker 3: dollars worth of debt aud or a bit over, it

67
00:03:55,640 --> 00:03:59,160
Speaker 3: all started to go pretty south last year when Chinese

68
00:03:59,160 --> 00:04:03,120
Speaker 3: authorities introduce new regulations for property developers known as three

69
00:04:03,200 --> 00:04:07,920
Speaker 3: Red lines. Those new rules essentially meant that the amount

70
00:04:07,920 --> 00:04:11,680
Speaker 3: of debt property developers have was to be restricted. So

71
00:04:11,760 --> 00:04:13,840
Speaker 3: in order to comply with those new rules from the

72
00:04:13,920 --> 00:04:18,440
Speaker 3: Chinese authorities, Evergrand then had to start selling its properties

73
00:04:18,480 --> 00:04:20,760
Speaker 3: at a cheaper price in order to keep afloat.

74
00:04:21,279 --> 00:04:24,720
Speaker 1: So I'm starting to understand what is about to happen here.

75
00:04:24,760 --> 00:04:27,120
Speaker 1: They've got massive debt levels and they now have to

76
00:04:27,520 --> 00:04:31,560
Speaker 1: almost have a big fire stock sale on their apartments

77
00:04:31,640 --> 00:04:35,240
Speaker 1: just to keep up with the regulations. It's all kind

78
00:04:35,240 --> 00:04:37,800
Speaker 1: of culminated in the last few days, hasn't it. With

79
00:04:37,920 --> 00:04:41,280
Speaker 1: demands from institutions they owe money too, saying we need

80
00:04:41,320 --> 00:04:43,159
Speaker 1: the money this week or you're going to have the

81
00:04:43,200 --> 00:04:47,680
Speaker 1: default on the loans. Just quickly, What exactly does defaulting

82
00:04:47,720 --> 00:04:48,839
Speaker 1: on the loan actually mean?

83
00:04:49,080 --> 00:04:52,839
Speaker 3: If Evergrand was to default on a debt, that means

84
00:04:52,880 --> 00:04:55,960
Speaker 3: that the company is essentially declaring that it cannot and

85
00:04:56,040 --> 00:04:57,760
Speaker 3: will not be able to repay the loan.

86
00:04:58,240 --> 00:05:01,560
Speaker 1: Gotcha, So they are about to say that they cannot

87
00:05:01,600 --> 00:05:05,000
Speaker 1: repay these loans to banks supplies home buyers and investors

88
00:05:05,000 --> 00:05:09,480
Speaker 1: all over the world. That's what's made global shareholders panic,

89
00:05:09,560 --> 00:05:13,560
Speaker 1: and that's why we saw a really substantial crash of

90
00:05:14,120 --> 00:05:17,960
Speaker 1: the US stock market on Tuesday night our time. Did

91
00:05:17,960 --> 00:05:20,120
Speaker 1: we see the same sort of damage hit the ASX

92
00:05:20,240 --> 00:05:21,960
Speaker 1: or the Australian share market yesterday?

93
00:05:22,120 --> 00:05:25,960
Speaker 3: It opened pretty low yesterday our time, but it did

94
00:05:26,000 --> 00:05:29,479
Speaker 3: recover throughout the day and it did close zero point

95
00:05:29,600 --> 00:05:34,000
Speaker 3: four percent higher, So it wasn't as bad as maybe

96
00:05:34,000 --> 00:05:37,559
Speaker 3: some expected in Australia. Maybe there's more to come, who knows,

97
00:05:38,000 --> 00:05:40,600
Speaker 3: but yeah, as of yesterday it was zero point four

98
00:05:40,600 --> 00:05:41,279
Speaker 3: percent higher.

99
00:05:41,720 --> 00:05:44,800
Speaker 1: You brought this story to our attention pretty early before

100
00:05:45,080 --> 00:05:47,840
Speaker 1: it kind of hit the main headlines. What was it

101
00:05:47,880 --> 00:05:50,520
Speaker 1: about the story that grabbed you and why do you

102
00:05:50,600 --> 00:05:53,880
Speaker 1: think we should care about what's happening with this particular

103
00:05:53,960 --> 00:05:54,719
Speaker 1: Chinese company.

104
00:05:54,920 --> 00:05:57,760
Speaker 3: I definitely started to see a lot of discourse, particularly

105
00:05:57,760 --> 00:06:01,760
Speaker 3: on Twitter about this story, and there was times where

106
00:06:01,839 --> 00:06:07,120
Speaker 3: some economics commentators were comparing it to the Lehman Brothers

107
00:06:07,160 --> 00:06:11,880
Speaker 3: in the US, which then eventually triggered the GFC. Now,

108
00:06:11,920 --> 00:06:15,480
Speaker 3: while a lot of other commentators have criticized that claim

109
00:06:15,520 --> 00:06:19,440
Speaker 3: of it being, you know, like the Chinese GFC, there is, yeah,

110
00:06:19,480 --> 00:06:21,559
Speaker 3: a lot of controversy around that, but sort of seeing

111
00:06:21,560 --> 00:06:24,240
Speaker 3: that sense of discourse, that means that it must be

112
00:06:24,320 --> 00:06:29,240
Speaker 3: quite a big issue. And while Chinese markets aren't necessarily

113
00:06:29,320 --> 00:06:32,080
Speaker 3: as global as what the US are, this would directly

114
00:06:32,120 --> 00:06:36,599
Speaker 3: affect people within China. Particularly home buyers are going to

115
00:06:36,640 --> 00:06:39,200
Speaker 3: be hit the hardest or some of the hardest, if

116
00:06:39,279 --> 00:06:41,359
Speaker 3: Evergrant is not bailed out or they do have to

117
00:06:41,400 --> 00:06:45,640
Speaker 3: default on their debt. So with that discourse, these affect

118
00:06:45,720 --> 00:06:48,960
Speaker 3: the everyday civilians. And then there's always the effect that

119
00:06:48,960 --> 00:06:52,640
Speaker 3: it's going to have on markets, and then also cryptocurrency

120
00:06:52,920 --> 00:06:57,039
Speaker 3: markets as well. Even yesterday with cryptocurrency markets, we saw

121
00:06:57,400 --> 00:07:02,280
Speaker 3: billions of value white off the market. So there are

122
00:07:02,360 --> 00:07:06,720
Speaker 3: these effects that go well beyond sometimes the country that

123
00:07:06,800 --> 00:07:09,640
Speaker 3: the issue occurs in and so hearing that sort of discourse,

124
00:07:09,920 --> 00:07:12,720
Speaker 3: it was quite important to make sure that we understood

125
00:07:12,760 --> 00:07:16,480
Speaker 3: the complexities of these economic stories, but also the individual

126
00:07:16,480 --> 00:07:18,680
Speaker 3: impact it's going to have on people that simply thought

127
00:07:18,680 --> 00:07:20,360
Speaker 3: that they were just buying a home and putting a

128
00:07:20,400 --> 00:07:22,680
Speaker 3: deposit down on their home and that are now going

129
00:07:22,720 --> 00:07:25,240
Speaker 3: to more than likely lose those deposits and not even

130
00:07:25,320 --> 00:07:26,400
Speaker 3: have their homes built.

131
00:07:26,720 --> 00:07:29,400
Speaker 1: I'm particularly interested in the effect it had on crypto.

132
00:07:29,760 --> 00:07:31,720
Speaker 1: Where's the connection there? How do we get from a

133
00:07:31,760 --> 00:07:36,200
Speaker 1: collapsing Chinese property company to bitcoin being in trouble.

134
00:07:36,360 --> 00:07:39,440
Speaker 3: Commentators are still trying to figure this out, but there

135
00:07:39,440 --> 00:07:43,000
Speaker 3: was some really good discourse around how with the popularity

136
00:07:43,040 --> 00:07:47,160
Speaker 3: of cryptocurrency rising and skyrocketing, particularly over the last year,

137
00:07:48,000 --> 00:07:51,200
Speaker 3: its popularity came from people that usually invest in like

138
00:07:51,240 --> 00:07:55,480
Speaker 3: the traditional share market actually moving over to cryptocurrencies and

139
00:07:55,600 --> 00:08:00,240
Speaker 3: also investing there too. And so originally when cryptocurrency is

140
00:08:00,480 --> 00:08:04,920
Speaker 3: prior to this, you know, explosion of popularity, cryptocurrencies were

141
00:08:04,960 --> 00:08:09,920
Speaker 3: seen as an alternative currency. But now because of that

142
00:08:10,040 --> 00:08:14,520
Speaker 3: widespread popularity, people are investing in it for more than that.

143
00:08:14,720 --> 00:08:18,000
Speaker 3: They're investing in it as investments, and even if they're

144
00:08:18,000 --> 00:08:20,720
Speaker 3: coming from those more traditional you know, share market investments.

145
00:08:21,160 --> 00:08:25,000
Speaker 3: So those behaviors of people from those traditional for a

146
00:08:25,080 --> 00:08:28,680
Speaker 3: lack of a better phrase, from those traditional markets, they

147
00:08:28,760 --> 00:08:32,120
Speaker 3: are carrying over their same behaviors Now. Usually when people

148
00:08:32,240 --> 00:08:36,080
Speaker 3: panic in times of crisis, like with ever Grand, they

149
00:08:36,280 --> 00:08:39,120
Speaker 3: typically sell out or they will get rid of their

150
00:08:39,160 --> 00:08:43,000
Speaker 3: shares to be safe or because of news that they've heard.

151
00:08:43,320 --> 00:08:45,959
Speaker 3: Now we also, for one of the first times ever,

152
00:08:46,400 --> 00:08:51,960
Speaker 3: saw those behaviors within cryptocurrencies. Typically, the cryptocurrency philosophy is

153
00:08:52,000 --> 00:08:54,840
Speaker 3: to hold on no matter what, no matter what's going on,

154
00:08:54,880 --> 00:08:57,600
Speaker 3: and that the cryptocurrency will recover well. For the first

155
00:08:57,640 --> 00:09:00,520
Speaker 3: time in kind of ever or for one of the

156
00:09:00,520 --> 00:09:03,640
Speaker 3: first major times, we saw that people were actually not

157
00:09:03,760 --> 00:09:06,120
Speaker 3: doing that and that they were selling, which then led

158
00:09:06,120 --> 00:09:08,880
Speaker 3: to the two hundred and fifty billion dollars in value

159
00:09:09,280 --> 00:09:13,640
Speaker 3: of the cryptocurrency markets just go. So again, we're still

160
00:09:13,679 --> 00:09:16,560
Speaker 3: trying to work this out and figure out these behaviors

161
00:09:16,600 --> 00:09:20,280
Speaker 3: of investors, but it was quite shocking, I think for

162
00:09:20,360 --> 00:09:23,000
Speaker 3: a lot of people who do invest in cryptocurrencies to

163
00:09:23,040 --> 00:09:26,960
Speaker 3: see this, especially with cryptocurrencies like Ethereum being down ten percent,

164
00:09:27,000 --> 00:09:28,120
Speaker 3: that's quite significant.

165
00:09:28,200 --> 00:09:32,640
Speaker 1: We've got a collapsing Chinese property company Global Ramifications and

166
00:09:32,720 --> 00:09:35,600
Speaker 1: not even bitcoin is safe. It sounds like a story

167
00:09:35,640 --> 00:09:37,600
Speaker 1: that The Daily Oos should be all over and all

168
00:09:37,600 --> 00:09:40,160
Speaker 1: over it we are. If you want to follow this

169
00:09:40,240 --> 00:09:44,160
Speaker 1: story as the markets wake up and launch today, follow

170
00:09:44,200 --> 00:09:46,920
Speaker 1: us on Instagram at the Daily Os. It's where over

171
00:09:46,960 --> 00:09:49,840
Speaker 1: now two hundred and twenty seven thousand Australians get their

172
00:09:49,880 --> 00:09:52,680
Speaker 1: news throughout the day. Yesterday we put up another post

173
00:09:52,679 --> 00:09:54,440
Speaker 1: saying if you're a small business that needs a hand,

174
00:09:54,480 --> 00:09:56,600
Speaker 1: chuck us an email and we will try and feature

175
00:09:56,600 --> 00:09:58,960
Speaker 1: you in our newsletters. We're giving away all our ad

176
00:09:59,000 --> 00:10:01,920
Speaker 1: spots for two weeks, have a fantastic home day, and

177
00:10:01,960 --> 00:10:03,000
Speaker 1: will speak to you tomorrow