Transcript QAV #446  Club Edition

 

 

Tony [00:00:35.8] You know people come to me for technical advice, right?

 

Cameron [00:00:38] That’s very sad.

 

Tony [00:00:41] Once. They don’t come twice.

 

Cameron [00:00:45] Welcome back to QAV, this is episode 446 and we’re recording this on Monday 15h November 2021. How are you TK?

 

 

Tony [00:00:58] Yeah good. Really good, thank you. How are you?

 

Cameron [00:01:01] That’s good.

 

Tony [00:01:02] Come stai?

 

Cameron [00:01:03] Molto bene, molto bene grazie, grazie. Molto bene. Actually, I promised our transcriber that we wouldn’t speak in Italian anymore. It’s hard enough. She said German and French would be fine, Italian is too much work.

 

Tony [00:01:15] Okay.

 

Cameron [00:01:16]: Let’s ah, let’s get into what’s going on. I wanted to start with saying that we sold SUN – I sold SUN – last week. Probably a couple of weeks later than I should’ve sold SUN. Suncorp breached its three point trend line sell line in late October and, totally missed it.

 

Tony [00:01:40] Yeah, no, I got it. I sold it. Yeah. Just set alerts in Stock Doctor for the sell price and that helps a lot.

 

Cameron [00:01:48] Yeah, yeah it would if I didn’t get four thousand emails a day and most of them were junk. Yes, no, I do set those but I missed that one and you didn’t tell me so it just…

 

Tony [00:02:01] Yeah I did, hang on.

 

Cameron [00:02:03] Did you?

 

Tony [00:02:03] Yeah, I always send you an email when I trade.

 

Cameron [00:02:06] Uh. You didn’t tell me I should trade it as well.

 

Tony [00:02:09] I didn’t know you had it.

 

Cameron [00:02:12] It’s not your fault. Yes no I just wanted…

 

Tony [00:02:15] ESP. Faulty ESP again.

 

Cameron [00:02:18] Oh, do I have to sell ESP as well?

 

Tony [00:02:20] No.

 

Cameron [00:02:21] I just wanted to put that out so that people remember to set alerts. Yes, gotta set alerts.

 

Tony [00:02:26] Yes.

 

Cameron [00:02:26] And, not just set alerts but I just wanted to remind people because I needed to remind myself that I have to go in and check the three point sell line sell price in the alerts at least probably once a month – like, the first of the month or something like that.

 

Tony [00:02:41] Yeah, once a month is good, probably not much more than that. Every month it could tick over to a new number, so once a month is good.

 

Cameron [00:02:48] I think by the time I got it was down by like 16%. But anyway…

 

Tony [00:02:51] Okay.

 

Cameron [00:02:54] Also, just want to remind people, particularly people listening to the free episodes, that paying attention to our stock of the week picks each week – most of which are doing quite well at the moment – there’s a couple that went backwards, south, but most of them are doing quite well. Um, but some will always go backwards and of course, buying them is only the first step in a successful strategy, you also need to know when to sell them, and we’re not going to be advising you when to sell them, so um, you know we’re not going to be sending, we’re not going to be tracking them, sending out alerts I don’t think it’s up to you as an investor to figure that out or, to pay attention to your three point trend lines and your rule 1 lines and that kind of stuff. So, but if you are looking at the stocks and buying them make sure you’re paying attention to, uh, you know what happens to them afterwards.

 

Tony [00:03:51] Yeah, we’ve talked about this for putting out our stock of the weeks now, um, in our emails, but I don’t really want to create another dummy portfolio so we’re not going to circle back and tell people when to sell them if they need to. But, you know, the basic rule of thumb is, with QAV is, that it’s a 60/40 game. Probably 40% of the stocks that we talk about are going to go down at some stage, and you’ve got to be ready to sell them as they breach – either rule 1 or your three point trend line sell. So, you know, I didn’t really want to set up a second dummy portfolio that tracks our recommendations so they’re just really recommendations to look at and do your own research as a starting point, not any sort of portfolio construction recommendation.

 

Cameron [00:04:31] Exactly.

 

Tony [00:04:32] I just wanted to add, and further to that, in this, you know I don’t know whether it’s because the market is, uh, climbing higher or what, but the last few months have been particularly choppy. And, you look at some of the stocks like you did then, Suncorp just dropped 15% in maybe a month or you know 4 weeks maybe, maybe less. It doesn’t take much to see stocks drop quickly at the moment. Possibly because they’re all priced to perfection. One that I, you know, came across recently was GAP – Gale Pacific – which if you look at its share price graph it fell of a cliff last week when they came out and gave a guidance, I think probably at their AGM, a guidance on full-year profit was going to be break-even at best. And so the share price reacted quickly and swiftly at that news and dropped. So you’ve gotta be either setting alerts or be checking regularly and then it’s much easier to set alerts than to check your portfolio regularly, for sure.

 

Cameron [00:05:28] Mm. Looking at the list of recommendations that we’ve made since we started again back in early September, 7th of September, I think about 60-70% of them are above water.

 

Tony [00:05:41] Mm-hmm, that sounds about right.

 

Cameron [00:05:42] Yeah, which is kind of our goal; 60-70%. But some of them are doing quite well. KRM, Kingrose Mining is up 60% since it was our stock of the week on the 20th of September, so that’s not even 2 months it’s up 60%. Michael Hill Jeweler’s up 34% since we recommended it on the 28th of September. Clearview Wealth, CVW is up 17% since we recommended it on the 4th of October. The rest are up sort of single digits, a couple have gone backwards. ZGL, AIS, SUN, Myer, Newhope Coal, EHL and CLX. But, again, you know, as I said, our goal is always to get about 60% that go well and we’re sort of spot on with that.

 

Tony [00:06:27] Yeah, and to pull our weeds quickly on the other ones.

 

Cameron [00:06:30] Yep. Uh, speaking of things to be updated for the club members, the Brettalator was updated last week to version 21.11.10. Thank you to Mr Brettalator himself for all of the work he continues to put into that for everybody. So, if you didn’t see that if you missed that on Facebook, make sure you follow the links on the QAV club member resources page on our website and got to the link of the latest Brettalator. And, as always, please make a copy of it before you try to use it. Don’t send Brett an email asking for permission to use the master version, that’s not going to work. Make your own copy; just go file-copy when you’re in Google Sheets and go from there.

 

Cameron [00:07:15] What do you want to talk about this week before we get into the questions,

Tony?

 

Tony [00:07:19.1] Yeah, so a few things. I spoke a couple years ago now about my three finger check on the economy – which is for me, the economy moves around petrol prices, mortgage prices, and the dollar – and petrol prices I just noticed last week when, because I’ve been locked down for so long I hadn’t filled up, but I went for a trip to Wagga and filled up on the way back, and it was like $1.65  or something a litre for fuel. So petrol prices are on the rise as we know because we’ve talked about Santos and other oil companies and gas companies before on the show recently. Oil prices edging, it’s back up over $80 a barrel. If the trend continued it could get back to over $100 a barrel which is where it’s been before, but who knows, no predicting. But if it does, that is going to be sort of one leg of the tripod pulled out of peoples pockets and usually, you know, two legs and an economy starts to collapse. So, we’re starting to see mortgage rates rise as someone pointed out recently on the show, that banks are now out of step with the RBA and they’ve started to raise mortgage rates because the bond yields are rising higher than the cash rate, which is generally a sign that interest rates are going to increase. Again, don’t want to predict by how much and when, and how long it will take, and for how high it has to go before people really start to hurt, but people have become quite used to low-interest rates and if they do rise, that’ll be the second leg of the milk stool kicked out from underneath the milkers. And when two legs go, the economy usually turns down.

The Australian dollar has been slowly creeping higher. It probably should be higher on the basis of the commodity exports we’ve been having, but the US dollar has been reasonably, well it’s been singing, but it has been reasonably flat of late. But, if the US dollar drops or if the Australian dollar rises, then yeah that’s three sort of crosses against the economy. So I’m just calling that out now, only because I saw petrol prices rise, and that’s the first leg that really starts to eat into people’s pay packets, and sometimes I think as investors and economists, and we’re not economists, but the RBA as economist, they forget that the vast majority of Australians out there are on a salary, and I guess by definition it’s around the average. And once you sort of take out more for petrol and more for a mortgage, and then if you start to pay more because the dollar’s rising for imports, you know, we’re stuffed.

 

Cameron [00:09:53] I thought the three-finger economics was when the economy crashes you’re pouring three fingers of scotch in a glass.

 

Tony [00:10:00] Yeah.

 

Cameron [00:10:01] You go from no finger to two fingers, to three fingers. And then you just start drinking from the bottle.

 

Tony [00:10:10] Yeah, lucky I stocked up over COVID and I couldn’t get out to bars, so that’s good.

 

Cameron [00:10:14] It’s like, I remember having breakfast with the CEO of Rivers, the clothing brand, I dunno, ten or twelve years ago. Part of, you know, an industry breakfast thing. And he said – the economy was going through a tough period at the time or something – and he said, somebody, asked him the question “what do you do differently when there’s an economic downturn?” He said, instead of drinking one bottle of wine at night I drink four, or something like that.

 

Tony [00:10:46] Yeah, and look, I just, I mean calling that out as a bit of an aside really, it won’t change the way we approach investing. It’s, things aren’t looking as rosy as they have been in the past.

 

Cameron [00:10:56] And if there’s a downturn, you know, the market will become more volatile and we’ll sell more than we would normally do over a period of time and maybe be sitting on some cash while we’re looking for things to buy back in. But we’re just you know, that’s just playing by the rules as we normally do.

 

Tony [00:11:10] Yeah, I mean that’s a good point, its business as usual as I said last year on Phil Muscatello’s show, the year before when the COVID cough first happened. It’s what the market does. You just got to be prepared for it, it’s got to be part of your framework to handle it.

C [00:11:24] Yeah.

 

Tony [00:11:24] Not be surprised by it.

 

Cameron [00:11:25] Market’s go in cycles.

 

Tony [00:11:25] Yeah.

 

Cameron [00:11:27] Talk to me about MQG and the SPP.

 

Tony [00:11:30] Yeah, so last week I was talking about the fact that Macquarie Group was having a share purchase plan which is open at the moment if you’re a shareholder. You have a chance to buy up to $30,000 worth. I made the comment that you might put in $30,000 and that will be kept by Macquarie Bank while the process plays out and then returned to you after the fact which could tie your money up from anywhere up to a couple of months really, and factor that into your equations. Steven May pointed out recently in an article he wrote, Macquarie has a history of not scaling back their share purchase plans, so you may well get all $30,000. So I was kind of making more of a general comment. And I also noticed that West African Resources, another company that I hold in my portfolio, has another share purchase plan going out at the moment as well so they may well scale back. So just the same comment, just something to be aware of with SPPs, you may get scaled back, and you’ll get a refund cheque or a refund deposit into your account for that, but just be aware if you’re banking on that money it may not come back to you quickly.

 

Cameron [00:12:34] Okay, good to know. Alright, top three dummy portfolio stocks for the week,

Tony.

 

Tony [00:12:40] Yeah, so the three in Navexa are Perseus, PRU, which is up 7.74%; KSC, which is K&S Transport, up 6.59%; and CLX, up 5.46%. So, they’re our top performers for the week.

 

Cameron [00:12:59] Wow, not bad. How’s our portfolio doing for the financial year this week? Ah, QAV portfolio for the financial year as of today, we’re up 7.14%, the SPDR200 is up 5.16% so we’re still about 40% above the 200 for the financial year.

 

Tony [00:13:20] Right.

 

Cameron [00:13:21] There you go. We did sell something last week too, I think I sold COG out of our dummy portfolio last week.

 

Tony [00:13:28] We did, didn’t we. Yeah

 

Cameron [00:13:30] And replaced it with MML, I think.

 

Tony [00:13:33] That’s right. Which has been in and out for a while, hasn’t it? Coupla times.

 

Cameron [00:13:36] It has. In and out like a priest and a nun, or something. It’s up 4% since we added it last week, so that was a good decision. NAB, you’ve taken NAB off your buy list?

 

Tony [00:13:49] Yeah, so NAB like three of the big four and Macquarie reported now for an end of September year-end. NAB is off the buy list because its operating cash flow decreased dramatically, and I know that banks have sort of funny operating cash flows compared to industrials but it was quite a big drop for NAB. I haven’t been able to understand exactly why, ‘cause you don’t get a whole heap of detailed information in the notes, but it talks about borrowings and loans being increased compared to the last half. Again, I haven’t done enough research to know what that is. I suspect it’s borrowing and loans for NAB as a business rather than NAB you know, borrowing money in the market and lending it out to mortgagees, but I’m not sure. But yeah, certainly operating cash flow has dropped. The funny thing is, the analysts all applauded the result and the NAB share price has risen since the results were announced. So there you go.

 

Cameron [00:14:48] There you go. What’s going on with Kangaroo Island port?

 

Tony [00:14:51] Yeah, so we spoke about what was called Kangaroo Island Plantation Timber now called Kiland. It pivoted from being a saw miller to a general farming type agricultural company. One of the things that they did in their latest results, or that they announced at their AGM sorry, was that they had to write down the port that they were using to export the logs from, which I think from memory may have burnt in the fires and they were still attributing a value to it and had plans to rebuild it. But then the South Australian Attorney-General knocked them back and they weren’t able to rebuild. That particular decision has become a focus for whatever South Australia calls its ICAC, its government watchdog. Because the Attorney-General in South Australia just happened to own a block of land across from the Kangaroo Island Plantation Timber’s plantation, on Kangaroo Island and has voiced opinions in the past that it was very noisy when the saw millers cut the trees down and the trucks rolled out to the jetty. So, apparently, and I’ll be careful how I say this, but apparently it’s not a good look that she turned down the rebuilding of the jetty and some people are saying that might be to suit her rather than what’s best for the island. But, ah, contentious issue, and in the news, and you don’t often talk about a small-cap stock like Kiland and on a show like this and then find that their issues are in the news next week. So, yeah, interesting times.

 

Cameron [00:16:21] Well you know that everyone listens to this show now,

Tony. We’re shaping the national conversation. Ah, okay, talk to me about…

 

Tony [00:16:33] Two more in the news stocks for us, Santos and Credit Corp, which I both own and have been a staple of the portfolio for a long time, they both fest up recently to taking too much JobKeeper and they’ve both returned a whole mess of JobKeeper back to the government. Which is a good thing, but it really only happened because of the, I’m not sure what the law change was but I know the One Nation party was behind it and the government was dealing with them to have better transparency of JobKeeper recipients and whether they actually need the money or not. Wonderfully enough, ever since that was mooted and talked about and may even have passed parliament now, people have started returning money to the government. So, yeah. I guess kudos for CCP and Santos for sending it back, and, maybe they just overlooked it for a while, while they were waiting to work out their numbers or something, but they may have been a bit slow at doing it.

 

Cameron [00:17:27] And you think One Nation’s driving it?

 

Tony [00:17:30] Yeah, look I should have been better prepared before I started talking about it, but the government was dealing with One Nation on a whole raft of issues and one of the things that One Nation asked for in the negotiation was a register of JobKeeper recipients to be set up, which the government didn’t do, but they did say that there would be greater transparency into who received what. And that’s caused, funnily enough, a lot of income back to the tax office in the last few months.

 

Cameron [00:17:55] Wow. I mean, the whole fact that this isn’t transparent in the first place boggles the mind.

 

Tony [00:18:02] It does, doesn’t it? Especially with the dollars involved. I know we’ve just spoken about the secondary effects of JobKeeper, so there is a valid argument for some people that got JobKeeper and didn’t pass it all on to staff who were still down from COVID, and they used it to repay down debt, for example, and they could argue the company was in a much better position, therefore, going forward, and they stabilise the company and that it maybe would not have gone forward without the JobKeeper money. But, it’s still no excuse for a nontransparent spending of $60 billion by the government, I think anyway.

 

Cameron [00:18:32] Yeah, yeah I mean you would think that the public has a right to know who got the money. If the company’s want to argue that they deserve the money and they used it well, that is up to them to argue, but people should still know where that money went.

 

Tony [00:18:46] Yeah, and of course as people like Steven May point out, it wasn’t just to listed companies, lots of private companies got it, a lot of schools got it, a lot of high-end schools got it, a lot of golf courses got it. You know, a lot of organisations you wouldn’t even think of as needing it got it. And possibly quite rightly, but we’ll never know.

 

Cameron [00:19:02] Mm. Well, I never thought these words would come out of my mouth, but well done One Nation Party.

 

Tony [00:19:12] Yeah, exactly.

 

Cameron [00:19:12] Next time I drive up to Bundaberg and I’m driving past all of the Pauline Hanson billboards in country Queensland I will refrain from…

 

Tony [00:19:20] Give her a thumbs up.

 

Cameron [00:19:22] … refrain from throwing things at it and, ah, yeah. This one time, this one time I will not throw things at Pauline Hanson’s billboards. What’s happening with Beach Petroleum’s CEO?

 

Tony [0:19:36] Yeah so, no one really knows but he resigned quickly recently and is moving on. Last time I had a look on the weekend, Beach was very close to its sell line, so I mean people may want to hold on and see what happens if it crosses its sell line or not, but certainly the CEO resigning unexpectedly is not a good look with Beach. I don’t own it, I don’t think it’s in our dummy portfolio, but I would be considering potentially to sell it based on that.

 

Cameron [0:19:59] So, uh, this is Mr Matt Kay, the CEO.

 

Tony [00:20:04] Yeah.

 

Cameron [00:20:05] And it was effective immediately. Chief Financial Officer Morne Engelbrecht will be assuming the role of acting CEO while a search is undertaken for a replacement. So, not a smooth transition…

 

Tony [00:20:18] No.

 

Cameron [00:20:19]…. By the sounds of it.

 

Tony [00:20:20] No, and generally, generally – who knows what the reason is, they haven’t given a reason, so, I don’t think they’ve even sighted family reasons as the reason they often do for an unexpected resignation or health reasons. Reading between the lines, and I’ll be careful what I say here, the largest shareholder in Beach Petroleum is the Stokes family, and there has been in some instances cases where CEOs have fallen out of favour with them and they have a disagreement about the direction of a company. You know, the rock meets the hard place and usually it’s the hard place that leaves and the rock stays on in terms of being the major shareholder. Anyway, I don’t know what the reason is, we don’t know what the reason is, certainly raises questions about whether we should be holding on to Beach energy going forward.

 

Cameron [00:21:00] Mm, but at this point, you’re just going to keep an eye on it?

 

Tony [00:21:06] Yeah well it’s so close to the sell line it almost doesn’t need to sell right now, we might as well just wait and see if it crosses. I haven’t checked it today, it may have even crossed it today.

 

Cameron [00:21:15] You hold it in your portfolio?

 

Tony [00:21:17] I don’t, no.

 

Cameron [0:21:19] Alright, well for people who do hold it, have a think about it.

 

Tony [00:21:23] Yeah, it’s been on the buy list for a while. I’m just going to have a look at the graph for it now. Freehand drawing of the sell line says $1.90, $1.10, and the price today is $1.24, so it’s getting down towards a sell. And it’s been a bit of a falling knife for a while, too, to be honest. Which is because of write-downs on reserves in the past, because again it’s a gas and oil company, so it should be on a tearaway a bit like Santos, but it’s not.

 

Cameron [0:21:47] Well that might have something to do with the CEO leaving.

 

Tony [00:21:49] Yeah, absolutely.

 

Cameron [00:21:51] FMG went up.

 

Tony [00:21:53] Yeah, so interestingly enough there was comments made at the AGM last week, you know, talked about the fact they were still exporting, it was still profitable, but also talked up a lot about their Fortescue Future Industries division which they’ve just set up, which will be funded by 10% of the profits going forward. And, they’ve been making some inroads into hydrogen but also into Lithium, and they were talking up those at the AGM which seemed to be well received by the market and the share price went up. But it made me look at iron ore, which is still going down so it’s not iron ore which is driving the Fortescue Metals price up. I also looked at all the other iron ore stocks, BHP and Rio didn’t seem to have the same sort of bounce at the same time. I did notice some of the smaller ones like Champion Iron did do a slight rebound, but I think this is a bit of news. I’m still cautious about buying back into iron ore stocks at the moment with the iron ore price still dropping, regardless of what happens with Fortescue and its lithium play, etc. etc. I’m not buying back in just yet.

 

Cameron [00:22:55] Right, okay. Wait and see then.

 

Tony [00:22:58] Wait and see, yeah.

 

Cameron [00:22:59] Alrighty then, shall we get into questions.

 

Tony [00:23:04] Yeah, or do you want to do stock of the week?

 

Cameron [00:23:05] Oh we haven’t done stock of the week. Yeah stock of the week, sorry.

 

Tony [00:23:07] It’s alright.

 

Cameron [00:23:08] What do you have for us this week,

Tony?

 

Tony [0:23:10] Yeah, small-cap is Atlas Pearls, ATP, which has been doing well lately. I’m not going to talk about the numbers on that one, but people can have a look. Very small ADT of about $7,000 so will only suit people with a small portfolio. And it’s basically a pearl fisherman, or pearl fishing business, based out of Indonesia I think or Thailand. Somewhere in the South East of Asia. It came onto the buy list recently and has been doing okay since then, so have a look at that if you’re after a small-cap to invest in.

The second stock, the large-cap is Super Group, SUL, and Super Group might sound like a bit self-aggrandising as a name, but it actually has its origins back in a company called Super Cheap Auto, which particularly Queenslanders will know about because it was a Queensland company originally. Interesting history, it started off in the early 70s as a mail-order parts business from the kitchen of a home in the Gold Coast. A guy called Reg Rowe from memory set it up in ‘72 in Queensland. And then eventually that got big enough as a mail-order business that he set up some stores, they were called Super Cheap Auto. That kind of became the Officeworks, maybe the Bunnings, of car parts particularly in Queensland, and were very very successful at selling bits and pieces for cars and parts for cars at good prices. They expanded well, and then eventually started to diversify away from the automotive industry and they bought out Rebel Sports a couple of years ago and then got into camping with ECF camping and MacPac. So because of those other acquisitions, they changed their name from Super Cheap Auto to Super Group, or Super Retail, Super Group. So, interesting company.

The numbers, the QAV numbers, it has a QAV score of 0.17, so it’s not at the top of our list, but a lot of these big companies -large-cap companies- are towards the bottom of our list. So the 0.17n is a reasonable score for it. It does have an average daily transaction of $9.5 million so it can suit, you know, all of our listeners this one. And I should say, it suits me because I own them. I bought them a couple of weeks ago. They came onto our buy lists again recently. They became a Star Stock in the last sort of five or six weeks as well, so ever since their last results came out they’ve been doing well. I’m going to base my numbers on the share price yesterday at 1$13.19, which is 14th November. At that price, they were just under the consensus broker price target and also Stock Doctors IV, so the QAV checklist gives them scores for that. The other thing that’s interesting about this company is that it has a high yield, so 6.7% yield, so we score it well for that. Also, interestingly enough, it has a return on equity of 27%, which is not something I normally pay attention to, but it does kind of give us context for retail-type companies. The net tangible assets for this company is only $1.59 if you remember the share price is $13 in change.

So one of the things that happens with these kinds of companies is they generally don’t own their stores or the land that their stores are on, and so therefore their assets are basically the fit-outs in the stores and whatever stock is passing through at the time. Which, because of that, means that the equity is lower than if they did own all their own land, and therefore the return on equity is higher. So, that’s just a way that management in the retail space has played with numbers for a while because people chase high ROE companies, they get out of property and that inflates the ROE. Not necessarily a bad thing, there’s certainly an argument to be made to say that retailers are in the business of selling things and not investing in land, but the contrary argument is that retailers know a lot about commercial property because they have to, because they’re negotiating leases and purchases all the time in the area. So, it’s a sort of swings and round-a-bouts story that one. But definitely, a good ROE doesn’t score for us on the price to book ratio though because of that. Good prop/caf, price to operating cash flow of five times which is if you think about the sort of stability of this business that’s, and the cash flowing through it, that’s a really good value purchase for us. It’s slightly above our IV 1, slightly less than our IV 2 which is $15.38, but not half IV 2 so it only gets one point for that. Interestingly enough, the forecast EPS is down, so when I do the yield over the PE I get a negative number. But I think that the reason the forecast EPS is down is because of COVID, so the forecast EPS will refer to the end of the financial year, which is the middle of next year, or maybe one month later, I’m not sure when Super Group reports but often retailers are a January and July.

Anyway, that’s the time period, and that means that a lot of the first half for New South Wales and Victoria anyway, the stores were closed, so the full year’s EPS will probably be down. I think most people are looking through that and trying to get a feel for the company on a business as usual basis and so they’re forgiving it for that drop in EPS. And certainly, the share price has been rising since COVID so it’s doing well for that.

The other good thing that scores well for us is that the original founder is still holding a large part of the company. So director’s hold 29% of this company, even though it’s got a $3 billion market cap, Mr Rowe is still sitting on $750 million – $1 billion worth of shares in the company, in the companies, and he’s still on the board. He was the original managing director and then became chairman and is now a director on the board. So that’s a good sign I think.

In terms of the manually entered data, it is trading on its lowest PE for the last three years, but its equity hasn’t always been consistently increasing so it’s 0 for that. All up, it gets a quality score of 86% and as I said before a QAV of 0.17.

 

Cameron [00:29:00] Alright, thank you for that. Super Cheap Auto. I’ll go in on the weekend and buy some more new car mats, just to check the place out again, give it the sniff test. Alright, let’s get into questions. First one this week comes from Reg, Reg says…

 

Tony [00:29:20] Oh, maybe it’s Reg Rowe, the founder of Super Cheap Auto.

 

Cameron [00:29:25] Oh, maybe it is, welcome Reg. No, I think it’s ASA Reg. “As a relative newbie, I’ve still got all sorts of questions whizzing around in my head, so I hope the ones I pose are not dumb or haven’t been asked before.” No such thing as dumb questions, Reg.

 

Tony [00:29:41] Mm-hmm.

 

Cameron [0:29:43] They’re all good. Even if we’ve answered them before, it’s a good reminder. I need to get reminded of things regularly, as my wife often tells me.

 

Tony [00:29:52] And I get to change my story, as well.

 

Cameron [00:29:57] Yeah. Go “What? The buy line follows the sell line, no I never said that. We’ll just create a new buy line.”

“Just wondered if there was any evidence if you’re wanting to buy that it might be more beneficial to buy from the list of new buys for that week as opposed to new stocks that have been on the buy list for a number of weeks?” What are your thoughts,

Tony?

 

Tony [00:30:19] Yeah, I thought that was a really good question, I don’t have the research to answer it, but I will add to my list and have a look. Generally, buying from the top down for me has worked best over the years, and I don’t pay attention to whether something’s a long way above its sell line or its been on the list for a long time. What I do find is that companies do stick on the buy list for a long time, and companies like Super Group go on and off, but they’ve been a part of my portfolio on-and-off now for a very long time. Sort of 15-20 years. So yeah, there are sort of, I won’t call them perennial value companies, but I guess companies which are usually undervalued by the market for whatever reason, but they’ve been good investments for me. So I’m not scared about buying something which has been on the list for a while, but I certainly haven’t done that piece of research Reg and I think it’s a really good idea and I’ll get back to you with the numbers once I crunch some.

 

Cameron [00:31:08] The other side of that story is I think when some of the stocks like the banks or Macquarie, I guess also a bank, some of those big companies that end up on our buy list which aren’t normally on our buy list because they’re normally overvalued, they end up in our buy list. Normally that’s pretty exciting though, they come in, they come in low…

 

Tony [00:31:31] Yeah.

 

Cameron [00:31:31] …You say they won’t be around for long.

 

Tony [00:31:33] Yeah, generally for at most six months. Like NAB, came on and went off with its next results, and there’s been other companies like JB HiFi comes to mind, which sort of just get onto the bottom and then they leave. So yeah, we do have to be aware of that, particularly if you have a need for large ADTs like I do. But generally, I’ll still buy from the top-down of the large ADT stocks I don’t own.

 

Cameron [00:31:56] Well speaking about Macquarie, I think this next question from Jeremy and Allie and a few other people were asking about this, and they’re all – you know, because Macquarie we talked about I think last week, I ended up adding Macquarie to my portfolio last week, but if you look at the chart it’s going through the roof right now – and Jeremy asked, this is on Facebook: “Anyone else struggle to buy shares at all-time highs or yearly high? It’s interesting psychology for me. On the one hand, highs are good, the stock is heading in the right direction, but I also fear people will take profits and the rug gets pulled.”

Allie in a separate thread, but similar intent I think, said “If I’m looking at C6C on the Brettalator, it’s number 25 on this weeks buy list but it’s way above its buy line, which it crossed ages ago, is that graph about ready to have another buy line drawn, and what do I think about it in the meantime? There are others in this weeks list that are similar though not as pronounced. So, yes, if it’s got a good QAV score and it’s above the buy line, might

Tony buy anyway, even though it’s been above the buy line for a long time and it’s going up sharply on the right.” I have to admit, I looked at the MQG, I was looking for something, I needed a high ADT stock to add to my Super portfolio. MQG was the next in the list, there wasn’t a Josephine, and I looked at the chart and was like “oh, shit”, like, you know, there is this psychology as Jeremy said where you know, part of me goes “well, it can’t keep going up” – remember you told me once, “no tree grows to the sky” or something…

 

Tony [00:33:29] Correct, yeah.

 

Cameron [00:33:30] But it was the next one on the list, so I bought it anyway. But, do you have any thoughts on that situation?

 

Tony [00:33:39] Well, me too, I own Macquarie Group since its last results came out. Yeah, whilst it’s true no tree grows to the sky, we don’t know when that will actually stop growing which is why we have our three point sell line, you know, formula. For companies like Macquarie, etc. we don’t have the benefit of the underlying commodities which is different to C6C, which was part of Alley’s comments. So, no, I just follow the rules. Let me pose some questions: If you had bought Macquarie Group when it was much lower, and were still a shareholder today, would you sell because it is going up? Or would you hold it?

 

Cameron [00:34:11] Well I would hold it, but that’s only because you tell me to water my flowers and pull my weeds, but…

 

Tony [00:34:19] Correct.

 

Cameron [00:34:19]… but we’ve had plenty of other guests, professional investors on the show that talk about rebalancing when things go up. They go “ah, it’s time to get out.”

 

Tony [00:34:28] Yeah, look, that’s, you know I don’t like rebalancing although I am running a test at the moment on that. What I’m looking at for rebalancing is for when things drop below a score of 0.05 on our QAV score, and Macquarie Group is nowhere near that score although it has been in the past. So, I did sell out and buy back in. That aside, it’s, you know, the quote that comes to mind is the Warren Buffet quote: “if you own Michael Jordan, would you bench him because he’s had a good year?” And the answer is no, of course. We have rules around when to sell these stocks, and we can’t predict when they’ll turn, so we wait for them to actually turn before we sell them. You know, as for things like C6C, the benefit, well I guess one of the added benefits of owning commodity stocks, is that you can look at the underlying commodity and we did sell C6C from our dummy portfolio because the copper commodity price turned, and so we have the benefit of being able t trade a stock like C6C based on copper. So that was just as, probably more pertinent, to C6C’s price graph than C6C itself. You could’ve still held onto C6C. You would’ve gone down a bit in the last six months, and now you’re going back up again. That’s the other dimension I guess, if something has a very low sell line it’s probably going to stay on or in our portfolios for a long time so we may have to weather periods of downturn while we wait for a new sell line to be drawn. So there’s that angle of it. But I don’t distinguish between those which are way above their buy lines and those that are close. In fact, I think it’s riskier if they’re closer to their buy line because, you know, sort of a market gyration, a 10% drop in the share market might see us selling out of it. Whereas, if it was like a Macquarie bank way above its sell line, we’d still be holding onto it and riding out that 10% correction. And likewise, if a company just goes above its buy line, there have been plenty of cases where they peak above, I buy them, they drop back again, which is not good because they’re below their buy line. We have to decide whether to keep them or sell them. The last point I’d make to Allie is that C6C has just actually redrawn its buy line, so it’s this concept of the second buy. The Brettalator has the buy price when the share price graph took off, which is what it should be doing, the buy line following the sell line, but you can use the old rules, or not the old rules, the basic rules of H1 and H2 being the highest and second-highest points on the graph and drawing that other buy line for a company like C6C, which gives us what I’ll call the second buy line, and just through discussions with Brett recently and looking at some minor code changes to the Brettelator I’ve kind of come to realise that that second buy line is telling us that stock is no longer a Josephine. So if you look at the C6C graph it got to its highs and then it dropped back again when the copper price became a sell, and so it was like in a falling knife situation there for a while, and now it’s rebounding as copper’s become a buy again. And you can redraw a buy line even though there hasn’t been a sell for a long time, and that to me is saying it’s the end of a Josephine and it’s time to safely buy back into that stock.

 

Cameron [00:37:17] Regardless of the copper price?

 

Tony [00:37:20] Well no, we always use the copper price. The copper price is back to being a buy again. So that was the turning point for C6C. But I’m just saying Allie raised a question that it was close to its, to being able to redraw a buy line. I think now you can redraw the buy line for C6C. When I’ve seen this happen in other companies like Fortescue metals comes to mind, that sort of redrawing of the buy line is the end of a slight downturn on the way up, on the road up, and it’s the end of it being a Joesphine and you can sort of start to look at buying again.

 

Cameron [00:37:51] Right. Okay. Thank you,

Tony, I’m just playing around with the C6C chart, having a look at where I would draw these things, yeah right. Okay. Good stuff. We did very well out of that, I seem to recall C6C was one of our better stocks.

 

Tony [00:38:07] Yeah, it’s a great stock, isn’t it?

 

Cameron [00:38:09] Alright, Samuel. This is the last question for this week. Only three questions, have an early night. Pull out that three fingers.

 

Tony [00:38:17] Yeah.

 

Cameron [00:38:18] Samuel: “Bonjour, Cam and TK, I have a question for next week if I may. I refer to the KRM share which was stock of the week in September, had a look at it and formed an opinion and after the last report, the market reacted positively so I took a position. It’s been doing well, so once again, thank you for mentioning it. My question is about the risk associated with their business. Following their announcement I had a closer look at them and notices the deal involves mostly exploration, which I know little about, and sounds risky to me. They do provide a huge amount of geological assessment, which I don’t understand. Their future revenue’s not looking flash, with gold production about to end, and they make no secret about that, so I feel like I’m not owning a gold or nickel producer but an exploration company where the investor is buying the probability of future discovery. In this case, I feel the reported figures, annual and quarterly reports are only showing the past and not a reflection of the future. Does TK have any particular view on the consistency and reliability of exploration companies and the unusual risk associated with them? Meanwhile, since I feel I’m exposed to risk well above my comfort level, I will probably sell while I’m ahead as the beast has been very volatile.”

 

Tony [0:39:29] Well I hope, I hope he hasn’t sold them today, because they’re up like 11% or 12%. Look, they’re all good points. Part of my answer harks back to last week, which is to say apply the system, don’t try to predict. I’m not an expert on gold mines, I think most of our listeners wouldn’t be. There’s probably a couple out there who would know much more about it than I do. But that’s pretty much what you could say about every stock I invest in. Apart from the fact that I’ve been, you know, an occasional customer of Rebel Sport or I have a mortgage with a bank and things like that. We’re not really, the game we’re playing is not to be a vertical expert on one industry or one company, it’s to be a horizontal expert on how to use figures to base our investment decisions. So, I totally get the point though that was made about the fact that this company is transiting from one stage of its life, and throwing off lots of cash because it’s a gold miner, and it’s going into a new phase of its life when the gold life, or the mine life, is coming to an end and it’s turning into an explorer. But again, all I can say is that my experience is to still let sentiment be the guide on that one. This happens quite regularly with mines, and I’m thinking that probably the biggest and most recent example is Sandfire which is the large-cap copper miner who everybody knew was coming to the end of its DeGrussamine life, which was its big copper mine in Australia, and it started doing, did exploration around DeGrussa, but also decided to do acquisitions and buy big mines overseas and raise new capital. So that could also be in the future of Kingrose, KRN. And I think that’s what’s driving the share price rise today, some M&A activity that’s going on. The share price from now on will be largely news-driven. I’m trusting in the fact that the company has a ton load of cash sitting on its balance sheet and motivated management to keep the operation going for as long as possible so they don’t lose their jobs and keep their bonuses, etc. So yes, while it might feel uncomfortable because you are transitioning from one type of company to another, it’s my experience that these things generally work out. I wouldn’t say necessarily always positively, because if you look at Sandfire it went down before it come up, and there’s a capital raising so you have to decide whether you want to participate in that, but generally, the fact that we’re in a miner that has lots of cash on its balance sheet is a good thing. And the fact that we have motivated management to deploy that cash to keep their jobs is a good thing, and so that’s what I’m trusting in really.

 

Cameron [00:41:51] It’s funny, I think I said to Sam on Facebook I think

Tony will say trust the management, see what they do.

 

Tony [0:42:02] Yeah and if we get it wrong, I mean, we’re going to be the last to know. The share price will drop through its sell line. So set your alerts and pay attention to that, but we’re largely going to be sentiment driven until the company enters into another stage of its life. Which, you know, based on some of the news coming out today might be to acquire another mine.

 

Cameron [00:42:19] And I’ll just add, like, with all due respect to Sam, you know, obviously very smart, he’s getting down into the weeds and looking at the details. But having done this show for nearly three years with you, people ask these questions from time to time, “well what about this aspect of their business? And what about that aspect of their business?” And your answer every time has been pretty much the same thing. It’s just basically a variation of, you know, you’re thinking too hard.

 

Tony [00:42:43] Yeah.

 

Cameron [00:42:43] Look at the numbers, stay out of the weeds, you know just follow the process. Stop thinking too hard. There’s no part of the QAV process that says get down into the nitty-gritty micro-details of what’s going on with this business. If

Tony wanted you to do that, it would be in the checklist and in the Bible.

 

Tony [00:43:06] Correct.

 

Cameron [00:43:06] If It’s not in the checklist or the Bible, it gets back to what I said last week; it’s great that you’re doing that thinking and if you’ve got nothing better to do with your time, but that’s not part of QAV’s process.

 

Tony [00:43:20] No.

 

Cameron [00:43:20] We just look at the numbers.

 

Tony [00:43:21] Yeah, and look, I don’t blame Samuel for selling something he’s not comfortable with. I fully get that, that’s fine. But if he has sold, it didn’t say he had, but if he has sold, please sell some more, because the stock price is going up. So, for everybody who is still in it, they’d love you to sell some more Samuel.

 

Cameron [00:43:38] Maybe Samuel’s the new

Cameron.

 

Tony [00:43:40] Yeah, right. And you know what? That’s part of the psychological game we’re playing. You’ll always have these questions thrown at you by the companies we invest in and by the market, you can’t possibly know all the answers, so you don’t try to answer them, you just keep applying the system. We know that the system works.

 

Cameron [00:43:59] I got an email from a new subscriber the other day, who asked about debt to equity, “why isn’t debt to equity listed in the checklist?” And I said, well, it’s kind of factored into the Stock Doctor financial health rating, so we just let them do the work for us. But the same is true for all of the other numbers like the consensus valuations, those sorts of things. There are industry experts out there, well analysts, who are paid to go deep, do deep dives into the sector, into the industry…

 

Tony [00:44:32] Yeah.

 

Cameron [00:44:34] … into what the companies going, and they come up with their consensus valuations for all these things, and then we just look at the consensus valuation and give it scores based on the consensus valuation.

 

Tony [00:44:44] Yes.

 

Cameron [00:44:44] So we don’t need to do all of that, other people are doing that and we look at their work, and you’re just taking a macro view of the expert’s views on all these sorts of industry-related or business-related performance issues so you don’t have to, right.

 

Tony [0:45:05] Yeah, and that’s why sentiment is so important because a lot of that sentiment is driven by the verticals; the people who, day-in day-out, will analyse one particular sector. Banking, gold mines, whatever it is, they’ll do the deep dive. They’ll do the management interviews. They’ll form opinions, and then they’ll move large amounts of money around with their super funds or industry funds or large managed funds, listed investment companies or whatever, and that will change sentiment. So, a traditional value investor in the Warren Buffet mould will say don’t buy it if you don’t understand it and buy everything that’s going down, but I just found that was too hard for me, you know, as someone who was working at the time and setting all this stuff up to be able to then also go and meet with management and ask them questions and meet with the competitors and ask them questions and key customers, and all the rest of it. Couldn’t do it. But what I could do is, we’re lucky, I’ve ridden the tsunami almost of data that’s become available to retail end users because of the internet. You know, back in, when I started off doing my own investing, I used to have to buy an annual book from Huntley’s Money Weekly of one page per company of all their numbers for their results. Their annual results were summarised down into, like, the front page of Stock Doctor type thing. And do all the analysis by hand. And so, we’ve moved from that, from like telephone books of annual reports summaries through to being able to find out almost anything, anywhere at any time. And, it’s through that kind of evolution process that I‘ve been able to put together the checklist and do it at that kind of macro-level, not the micro-level.

 

Cameron [00:46:34] Yeah, and it plays to something I talk about on a lot of my other shows. This issue of epistemology and heuristics, you know, which I think are very important in trying to navigate your way through difficult topics where you can’t be an expert. I can’t be an expert. I can’t be an expert on epidemiology and what’s going on. Having debates with people about Ivermectin and whether Ivermectin is a good COVID cure, and go well “listen, I’m not an epidemiologist, I can’t be an expert, to what’s my heuristic? How do I know what’s likely to be true? What’s my heuristic, and where am I going to turn to to get that information?” I need to let the experts do the work for me, and then I look at what the experts are saying and say “okay, well that doesn’t necessarily mean that the experts are right, doesn’t necessarily mean that Stock Doctor’s analysts are right, or the fund manager analysts are right, but they’re the people that are dedicating their lives to working this stuff out, so I’m just going to use that as my heuristic.

 

Tony [00:47:41] Yeah, Correct. And they’re more right than wrong, otherwise, they’d lose their jobs. We can put some element of trust in them. But I think the other dimension to the stock market, which is even different to trusting medical research, or whatever, is the market just moves so quickly on information. So once the idea is out there that this is happening to this company, the share price will react like that *snaps fingers* and in fact, it’s also a bit of a forecasting engine and people like Roger Montgomery and Jeff Wilson will say that the market casts a shadow, and its usually about nine months into the future. So the market’s trying to position itself to what’s going to happen down the track. It’s a bit of a fortune-telling machine I guess, which is one of the reasons why it does get things wrong because you can’t do that really. But, you know, if people haven’t read the book “Wisdom of Crowds”, it’s fantastic. One of the key examples of that was when the space shuttle Challenger blew up within eight minutes, I think it was. The manufacturer of the o-ring that froze and didn’t expand when it should’ve and caused the petrol to mix to ignite when it shouldn’t have, was basically bankrupt. The shares dropped on the market dramatically. Eight minutes it took to work out what was wrong with the Challenger before NASA did. And NASA was still going on TV days later saying we don’t know what happened. The share market did. So, yeah, when you get a lot of smart people who are paid to understand things, they’ll move quickly and they’ll get their money out or they’ll get their money in as quick as they can. And so the share market is actually a really good information transfer vehicle. So, when we talk about sentiment, it’s a pretty trustworthy component to our investing.

 

Cameron [00:49:23] Alright. That’s Q&A for this week. After hours, we finished White Lotus last night. The series, I think it’s on Netflix, maybe Binge, a really good little series if you’re looking for a good short series.

 

Tony [00:49:41] Yeah, thanks.

 

Cameron [00:49:42] About a bunch of rich white people who go to Hawaii, stay at a hotel and all of the machinations and ins and outs between them and the hotel staff. Just rich white people problems. And, uh, I watched a film the other day, we watched a film on the weekend. I was forced into it by Hunter, called Whiplash, with JK Simmons.

 

Tony [00:50:05] The drumming one?

 

Cameron [00:50:08] Yeah, you seen that?

 

Tony [00:50:09] A long time ago, yeah.

 

Cameron [00:50:10] Yeah, it’s four or five years old. Good, but yeah funny like our different perspectives on it. Hunter thinks it’s the greatest film of all time and that JK Simmons character in it, the teacher, Fletcher, basically was a good guy. Yeah sure, he was mean, cruel…

 

Tony [00:50:31] A drill sergeant, yeah.

 

Cameron [00:50:33] Yeah, well it was basically like Full Metal Jacket but you know in a music school, right? Whereas my view was no, there’s no excuse for psychopathy. The guy was a complete psychopath. He forced one of his students to suicide, he was destroying students left, right and centre. The fact that he might produce a good musician somewhere along the line out of those sorts of tactics, in my book, is straight out of the Psychopath Epidemic, right?

 

Tony [00:50:58] Yeah.

 

Cameron [00:50:58] Psychopaths may deliver positive outcomes from time to time, but the net is they tend to do far more damage to people and society I think than they do good. Hunter and I ended up having this massive debate over breakfast on Sunday morning. He’s like, “nah you’re totally wrong, this guy was the greatest.” I was like, “dude, you just haven’t worked for enough psychopaths yet.”

 

Tony [00:51:26] Yeah.

 

Cameron [00:51:27] Go out there and work for psychopaths for 30 years then tell me that their tactics are justified.

 

Tony [0:51:32] Yeah, and be yelled and screamed at for weeks on end while you’re trying to do your job, and learn. See how you like it.

 

Cameron [00:51:37] And not just you, everybody. Like I saw this at Microsoft. I saw lots of really good, smart people leave because they ended up working for a psychopath and they were like, life’s too short, I’m just going to get out of here.

 

Tony [00:51:51] Yeah.

 

Cameron [00:51:51] I don’t think that’s, I don’t think it’s a good management approach.

 

Tony [00:51:56] No, and it’s often the approach of someone who feels threatened by smart people underneath them to belittle them and make life hell for them, yeah.

 

Cameron [00:52:06] Yes, I agree, I said to Hunter like okay, so JK Simmons character, what if he’d taken the young drummer guy earlier on and said listen, you’ve obviously got a lot of talent. You’ve obviously worked very hard to get to this point. You’re obviously very passionate. You’re not quite good enough to be in my band right now. Tell you what, go train for ten hours a day for the next thirty days, come back and have another crack at it. If you have any questions, anything I can do to help, this is my email address, this is my phone number, give me a call. I’m here to help. But you know, right now you’re not going to cut it. But go away and train. Would that not have the same effect as swearing at the kid, and making fun of his mother leaving him when he was a child, and you know, screaming and yelling and violence, and throwing things. Smashing chairs against the wall.

 

Tony [00:52:59] Yeah, it’s not on, is it? I remember I had a classic case of that when I was about 15. I was in the Air Training Corps, the air cadets. We’d get taken up to Amberley

every year to fly around in helicopters and planes and things. Anyway, but most of it was just being marched around the drill square learning how to parade and all that crap. And after three or four days of this, there was an old guy who came in and took us for a session, and just sat us all on the ground and told us a story. He said “you guys know how to march, I’m not going to drill you. You are going to prove that to me at the end, we’ll get up and do it once.” And we all just went, “oh this guy is the best, he’s so good.” We’d do anything for him.

 

Cameron [00:53:] Right, yeah.

 

Tony [00:53:38] And after he’d finished his story, he said “okay, show me how you do it”, everyone did it perfectly, he said “right, dismissed.” And like, that’s the one person I remember from my whole time being trained in the Air Cadets.

 

Cameron [00:53:50] Yeah, look I can understand though from a military perspective, you know a large part of the military culture is to break down people’s personalities and turn them into war machines who don’t question. But that’s not how you, that may work in the military, but it’s not how you create great artists or great employees and workers I don’t think.

 

Tony [00:54:13] And look, I’ve had bosses who in my corporate days were ex-military and I always tried to avoid them because they were always, even if they came across nicely, under pressure they’d revert to type and start yelling and screaming and shouting, expecting everyone to sit up straight and march to orders. They were just the worst.

 

Cameron [00:54:29] Command and control. Yeah, the guy that prompted me to leave Microsoft was an ex-military guy, It was the exact same sort of thing, you know, just trying to crush any opposition in his path.

 

Tony [00:54:39] Yeah, which is why I’m a share investor and not still working in corporate, because who needs that kind of grief, right?

 

Cameron [00:54:45] Yeah, yeah exactly.

 

Tony [00:54:47] Tell me about The Many Saints of Newark. You went to see that.

 

Cameron [00:54:49] Did go see that, didn’t have high expectations for it. For people who don’t know, this is the prequel film to The Sopranos. Chrissy and I both actually enjoyed it, not that it’s perfect, it has some flaws, but for a two-hour film. You know, if you think of it as a standalone film, I think, and you don’t think of it as a Sopranos prequel, it holds up pretty well. And there’s cameos of the younger versions of characters that you know from The Sopranos. The guy who does Silvio does a spot-on impersonation of a young Silvio, it’s just glorious. The young Pauly Walnuts didn’t have as much to do as I would have liked. Vera Familiar who’s doing young Livia Soprano gets in a couple of good scenes, but again, not as much as I would have liked. Michael Gandolfini does a great job as a young Tony Soprano, but again he’s not in it a lot. It’s really a film about Dicky Moltisanti, Christopher’s father, which is kind of irrelevant really to The Sopranos except that he’s sort of an older mentor to Tony which then Tony obviously becomes for Christopher after his father dies. Ray Liotta does a great job in it, I mean the cast were great. It was a reasonably good film. I would have liked to have seen more of what happens next.

 

Tony [00:56:17] Right.

 

Cameron [00:56:17] Like I think, from where that film ends to where The Sopranos starts. Like how did Tony, because at the end of the film is when Tony decides he’s going to become a gangster. But I want to see young Paulie, young Silvio, young Tony, you now all these guys, make their bones and come up through the ranks.

 

Tony [00:56:38] Yeah. Yeah, right.

 

Cameron [00:56:40] You know, there’s not a lot of Johny Soprano, Tony’s dad played by John Bernthal. He’s in it, but he’s in prison for a lot of it so you don’t really see him. That’s the reason

Tony’s close to Dicky Moltisanti because, oh the guy who plays Uncle June…

 

Tony [00:56:55] Yeah, I was going to ask you about him.

 

Cameron [00:56:57] Oh, he does a great job. He’s quite a big role in it. He does Uncle June to perfection, including Uncle June’s favourite swearing, which I probably can’t say on this podcast, but he gets that in four or five times in the course of the film. It’s really good. So yeah, we enjoyed it, yeah. It’s not going to be a classic. I think a big problem for a lot of critics is probably it isn’t, you know, it doesn’t reach the benchmark of The Sopranos. Like probably one of the, if not the greatest tv shows of all time.

 

Tony [00:57:38] Yeah.

 

Cameron [00:57:39] It’s not the greatest film of all time, it’s not even in you know the upper echelons. But it’s a good film, it was enjoyable and worth a watch for a Sopranos fan definitely, I think.

 

Tony [00:57:49] Yeah, good. Okay. Well, we watched a lot of dreck in the last couple of weeks. Probably the dreckiest was one called The Comeback Trail with, speaking of gangsters, Robert Deniro playing a comedy role. And he does terrible slapstick comedy. He’s tried it before, and Rock and Bullwinkle springs to mind, and other ones that just have bombed. But it’s so bad it’s almost good. It’s worth checking out just because it’s just… The story is, Deniro plays one of those ‘70s Hollywood film producers who are just scamming all the time. A very old Tommy Lee Jones plays an actor, he’s the comeback trail, he’s an old-time cowboy actor who’s brought back to star in a movie, but Deniro’s scam is that he’s hired this guy because he does his own stunts and Deniro’s going to kill him on the movie set and claim the insurance, and that’s going to get him out of debt with various Shilocks around town. And Deniro’s just not a comedy actor, he overacts the whole way something shocking. But yeah, it’s so bad it’s good.

 

Cameron [00:58:49] And yet, those ones he did with Billy Crystal were a big hit, where he played basically a gangster…

 

Tony [00:58:56] But he plays the gangster part, whereas here he’s trying to play the comedy type actor. Just doesn’t work.

 

Cameron [00:59:03] And the King of Comedy was a great film, but again, he was playing a sort of a psycho in it. I love that film.

 

Tony [00:59:13] Yeah. me too.

 

Cameron [00:59:14] Highly underrated film, that.

 

Tony [00:59:15] Oh, I agree. Yeah, so, read another Steven King book, I’ve been on a bit of a Steven King binge, called the Institute. So that came out last year I think. After reading Billy Summers which I read recently which I really liked, I went back and read that one. It’s again, very good. He just writes so well, you just get dragged into these stories by the characters. His writing is just top grade. You know, I remember, it’s like a well-built house. It’s like the story, the stories are very flimsy, the plot, and quite incredible really, but he just sucks you into the world so well you just want to keep reading and find out what happens to the characters. I remember doing writing courses where they’d teach you, you know, every scene starts with the five senses; what’s the character seeing, what are they hearing, what are they smelling, touching, and then how are they reacting? What’re their feelings, how are they reacting to all of those things. And every scene in the King book opens up with that, you get put right into the scene straight away. Yeah, it’s just really really good writing. Anyway, I get sucked into it all the time. But yep, so it’s called The Institute if you like that kind of thing. Yeah, not much, I mean we’ve been going back to the faithfuls. Total Control’s back on the ABC which we love on Sunday nights, so that’s Deborah Mailman and Rachel Griffiths, that’s really good. Uh, and that’s about it. Shetland, I’m still going through that. Succession every Monday night. Succession night tonight. That’s really good.

 

Cameron [01:00:32] I know, yeah, oh god, last week’s episode was so good.

 

Tony [01:00:36] It was, wasn’t it.

 

Cameron [01:00:40] Did you know that Kara Swisher does the official HBO Succession podcast?

 

Tony [01:00:46] No, I don’t know who Kara Swisher is either.

 

Cameron [01:00:49] Oh, okay so she’s one of the top business journalists in the US.

 

Tony [01:00:56] Okay.

 

Cameron [01:00:56] She used to host the tech conferences with Walt Mossberg and she’d have, you know they’d have Gates and Job’s on when he was still alive. She knows all of the top players intimately in the US. Like she’s interviewed everyone. I don’t know who she normally has on, I just discovered it, but last week she had Mark Cuban come on and talk about some of the things that happened in last weeks episode, where the op investor calls them out to his island house and drills them over their plans. She’s like, “would that really happen, you know? You own bunches of companies and you’ve been major investors, what’s the relationship like between CEOs and investors?” And he was talking about, “well, you know,” what’s his name, the main guy, Roy?

 

Tony [01:01:45] Logan Roy.

 

Cameron [01:01:47] Yeah, he goes “Logan’s obviously sold down a lot of his stock over the years, and he didn’t create class A and class B shares, so obviously control of the company resides with his ability to keep all of the major investors happy and voting his way.” He’s talking about all this stuff and it was, it’s an interesting approach, to have a top business journalist hosting a television review podcast but can get into the nitty-gritties about the business machinations of what’s going on, so yeah.

 

Tony [01:02:17] Yeah, good I’ll look out for that. Mark Cuban’s a good interview subject too, I hear him on the Jolly Swagman, talking about NFTs and Ethereum and stuff. It was a really good interview. And his whole history as well.

 

Cameron [01:02:29] Well, but you know he sort of lost me ten or fifteen years ago, when he said “there’s no way the internet, there’s no way we’ll ever be able to stream TV over the internet. There’s not enough bandwidth and it’ll never happen.” Not it won’t happen today he said, it’ll never happen he said, “there’ll never be enough bandwidth to stream TV over the internet”. Even back then, I was like hmm, you sure about that? But anyway, I guess everyone gets it wrong from time to time, even Mark Cuban.

 

Tony [01:02:57] Yeah. And talking of Netflix productions in the business press, I think the Fin Review carried an article about The Crown, the latest series of The Crown, which I don’t watch, but it was under production. But the interesting thing is that they had hired Natascha McElhone, the Irish actress,

 

Cameron [01:03:14] I love her!

 

Tony [01:03:15] Yeah, to play I think it was, Lord – it wasn’t Mountbatten’s wife – but something in one of those peripheral families. It caused a sensation because McElhone’s father was in the provisional IRA…

 

Cameron [01:03:31] Oh, wow.

 

Tony [01:03:33] …and uh, she’s supposed to be playing a part in the Mount Batton family, and of course, Lord Louis went for a trip over Big Ben courtesy of the IRA, so yeah there was a lot of controversy. I don’t know if she’s going to hold onto the role.

 

Cameron [01:03:46] A trip over the Big Ben?

 

Tony [01:03:48] Well, he’s blown up by the IRA.

 

Cameron [01:03:50] Yes, he was on a boat with his kids, as I recall. They went on a fishing boat and it got blown up. Yeah. I talked about him on one of my shows a while back. Yeah, she was in that David Duchovny show where he was the writer. She was his ex-wife.

 

Tony [01:04:08] Californication.

 

Cameron [01:04:09] That’s it. She’s a very pretty lady. Very pretty. Alright, well, I don’t watch that show either because I can’t stand the Royals…

 

Tony [01:04:20] No, I’m in the same boat.

 

Cameron [01:04:24] But I might watch it just for her.

 

Tony [01:04:25] It’s like watching Succession, except they didn’t make up their own fortunes, they just camped from Germany to Britain and changed their names. Yeah.

 

Cameron [01:04:37] Good to be the King.

 

Tony [01:04:37] Yeah.

 

Cameron [01:04:38] Alright, thanks, mate.

 

Tony [01:04:39] Okay, thank you. Bye.

 

Cameron [01:04:46] The QAV podcast is a production of Spacecraft Publishing Proprietary Limited authorized representative of FSL 520442 AFC Representative No. 0012927718. Please don’t make any investment decisions based solely on listening to this podcast. This is presented as general advice only, not personal financial advice. We don’t know your personal financial circumstances. Please see a financial planner before making any investing decisions.

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