QAV #706 — The Anti-QAV

QAV 706 Club

[00:00:00] Cameron: Okay. Uh, gimme a 1, 2, 3. Wel­come back to QAV

[00:00:14] Cameron: Toe­cut­ter. Toe­cut­ter Kynas­ton. Based on a sto­ry he was just telling me off air. This is episode 7 0 6, record­ing this on the 6th of Feb­ru­ary, 2000 and twen­ty-four. How are you TK?

[00:00:30] Tony: Yeah. Very well, thank you. How are you?

[00:00:33] Cameron: I am good. Hot. It’s hot in Bris­bane today. That’s a, like

[00:00:37] Tony: Uh, it’s cool

[00:00:38] Tony: down here. It’s windy and wet.

[00:00:40] Cameron: Hmm. Uh, the mar­ket hit. It’s all time high this week, Tony. And then thought about it for a sec­ond and went, nah, I’m not feel­ing it. I’m not feel­ing it. Went home, dropped again. Uh, and I loved it. I read in the Finn this morn­ing, Finn was say­ing on Wall Street the Dow was dragged low by McDon­ald’s.

[00:01:02] Cameron: Its fourth quar­ter sales missed expec­ta­tions, reflect­ing in part the impact of the war in the Mid­dle East. McDon­ald’s slid 4%. the war in the Mid­dle East where peo­ple in Gaza are eat­ing less McDon­ald’s now. I mean, what?

[00:01:21] Tony: Yeah, I had, I actu­al­ly, I had­n’t even thought of that. I, I was just think­ing of its Amer­i­can sales, but it could be world­wide sales, I sup­pose, of the down, because that part of the world is not eat­ing for some rea­son. But yeah, I would­n’t have thought

[00:01:33] Tony: the war in the Mid­dle East would be back McDon­ald’s.

[00:01:36] Cameron: And then that affects the Aus­tralian share mar­ket mar­ket. So peo­ple in Mid­dle East have stopped eat­ing McDon­ald’s, so our mar­ket falls

[00:01:44] Cameron: go.

[00:01:44] Tony: Well, it’s like, it’s like this is what hap­pens in the share mar­ket, right? There’s almost, there’s always a default answer for when­ev­er any­thing goes wrong. Oh, it’s ris­ing inter­est rates. Oh, it’s the Ukraine war. Oh, it’s sup­ply

[00:01:53] Tony: chain covid prob­lems. It’s just there’s always one default

[00:01:56] Tony: answer when no one knows.

[00:01:58] Cameron: Right, but that, you know, you can’t go in the finan­cial review and go, we got noth­ing. We dun­no what’s going on. You know,

[00:02:07] Tony: Yeah.

[00:02:08] Cameron: it does­n’t real­ly sell papers

[00:02:11] Tony: we found this junior ana­lyst at Bumfuck.com in, in New

[00:02:14] Tony: York. He reck­ons it’s because, uh, the war in the

[00:02:18] Tony: Mid­dle East.

[00:02:19] Cameron: that actu­al­ly a URL if

[00:02:20] Tony: I got a sauce.

[00:02:21] Cameron: if it’s not,

[00:02:22] Tony: a sauce.

[00:02:22] Cameron: I’m, gonna reg­is­ter that at Bumfuck.com

[00:02:25] Cameron: already. Oh. Oh. It’s def­i­nite­ly a, it’s, it’s, uh oh, pop­ups. Oh my God. Yeah. Okay. I’m get­ting dis­tract­ed now. Um, well, yes, our port­fo­lio is still track­ing around about dou­ble mar­ket. Tony, um, had a good week. Uh, port­fo­lio was up quite a bit ver­sus the STW did­n’t have to sell any­thing.

[00:02:51] Cameron: Men­tioned DUR last week. We said the DUR, which is sort of the Michael Jor­dan in the port­fo­lio, had come down a bit and took a hit last week. It, it was back 9.5% last week, so I think you were sug­gest­ing last week it could have just been prof­it tak­ing there. It seems to go up, come back a bit. Go up, come back a bit, go up, come back a bit.

[00:03:12] Cameron: Still not back to its high of like one 70 some­thing. I think it’s still around 1 55, but it bounced back 10% last week after we talked about it. So I’ll, I’ll, uh, take cred­it for that. It was the QAV bump, we’ll call it.

[00:03:26] Tony: Would you like me to talk about it again

[00:03:28] Cameron: Yes, please do.

[00:03:30] Tony: Yeah. Well, I think the point is that stocks just don’t go up and up and up. They go up, pull back up. It’s two steps for­ward, one step back. So you’ve always got­ta take that into account If you’re think­ing about tak­ing prof­its, it, it depends on your risk pro­file and your risk tol­er­ance.

[00:03:47] Tony: As we said last week, if it’s wor­ry­ing you take some prof­its or take half prof­its and leave half on the, on the counter. Um, but as I said last week, I would­n’t be

[00:03:56] Tony: sell­ing a, a good com­pa­ny like Duratec at this stage.

[00:04:01] Cameron: Speak­ing of peo­ple lis­ten­ing, we, we, we did a, you did a pulled pork on Fen­di, I think it was last week, and the man­ag­ing direc­tor of Fen­di reached out to us and said, thanks very much.

[00:04:12] Cameron: And,

[00:04:12] Tony: Yeah. Two weeks. Two weeks ago. And have you

[00:04:14] Tony: seen the share? I think the curse of the pool pork is over. Have you seen the share price of

[00:04:18] Tony: Findy?

[00:04:18] Cameron: I have actu­al­ly,

[00:04:19] Tony: I did the, I did the pulled pork at a

[00:04:22] Cameron: right, it’s a dol­lar 40 now. A dol­lar 44.

[00:04:26] Tony: Okay. It’s actu­al­ly gone down then. ’cause it was gone up to a dol­lar 70

[00:04:29] Cameron: It was a dol­lar 70 last week.

[00:04:31] Cameron: It’s pulled back a bit. That’s ’cause we haven’t talked about it for two weeks.

[00:04:34] Tony: Yeah,

[00:04:35] Cameron: No won­der he wants to come on the show. Um,

[00:04:38] Tony: What’s our charge? What’s, what’s our, our nor­mal

[00:04:41] Tony: fee?

[00:04:41] Cameron: let’s just wait and make sure that Paul Pork Curse is over before we, uh, start charg­ing for it.

[00:04:47] Tony: Well then we charge not

[00:04:48] Tony: to do pulled porks. Right.

[00:04:51] Cameron: Well, speak­ing of things going up and going down, uh, we did talk, I think last week about CCP and um, the results were com­ing out. You said they would prob­a­bly down­play the earn­ings, the, and the shares would prob­a­bly fall the result I sug­gest­ed we should maybe, um, get out, pre­empt it. You said that would be pre­dict­ing Well, the results came out, the shares did fall, but then they bounced back up again, but then they fell again.

[00:05:25] Cameron: Uh, so I dun­no

[00:05:29] Tony: they seem to fall too. It’s pos­si­ble the a FR has a, a stronger pull on stock price move­ments than we do. But there was a, um, an arti­cle, I think it was in the a FRA day or two ago, uh, about how on the one hand, cred­it Corp was say­ing they’re tak­ing your right down because the US econ­o­my isn’t strong.

[00:05:49] Tony: But on the oth­er hand, they’re say­ing it’s a great time to buy dis­tressed ledgers. When the econ­o­my isn’t strong. So, um, the ana­lysts were say­ing, you know,

[00:05:58] Tony: which is it Are they, are they low balling us

[00:06:00] Tony: again?

[00:06:00] Cameron: Yeah. Well, it did­n’t drop 30% like it did in Octo­ber. It dropped, uh,

[00:06:07] Tony: Yeah, true.

[00:06:09] Cameron: and then recov­ered a bit, but obvi­ous­ly still not back to where it was.

[00:06:14] Tony: Hmm.

[00:06:15] Cameron: in Octo­ber. Is it 20 twen­ty-one dol­lars six­ty-two back then dropped down to 11 $12. Now it’s back up to $17, but

[00:06:27] Tony: Yeah. Tra­di­tion­al­ly this is the time to buy CCP. ’cause they gen­er­al­ly, uh, uh, under promise and over deliv­er. And

[00:06:34] Cameron: mm

[00:06:35] Tony: I think the ana­lysts who, who pulled their, um, their report apart was prob­a­bly cor­rect in that, um, they’re try­ing to, try­ing to down­play every­thing. So it can’t be all bad. They’re either gonna buy lots of debt ledges because, um, the econ­o­my’s reced­ing in the US or they’re going to have more, uh.

[00:06:52] Tony: Or the inabil­i­ty to col­lect as much more write downs, um, because the econ­o­my’s reced­ing,

[00:06:57] Tony: But which one is it? So yeah, they’re sand­bag­ging.

[00:07:01] Cameron: if I had sold it before the results came out at $18 40, I would’ve been able to buy it again at 17 bucks. So.

[00:07:10] Tony: Um, you are becom­ing a gun trad­er. You could, if you can take the peb­bles from my hand, you can go out in the world on

[00:07:20] Cameron: watch me catch a fly with my chop­sticks. Uh oh. Well, um, Joe G in our chat room said he did buy CCP on the dip. So,

[00:07:31] Tony: No. good, for you, Joe.

[00:07:32] Cameron: work, Joe. Um, in less excit­ing news, Google banned our ads and Google ads and declared they were click bait last week.

[00:07:44] Tony: Click­bait.

[00:07:45] Cameron: bait,

[00:07:47] Tony: But they weren’t wor­ried about any of the after-hours con­ver­sa­tions on, uh, what was the book you’re read­ing? Venus

[00:07:53] Tony: and Furs. They just, they’re wor­ried about click­bait, huh?

[00:07:57] Cameron: are promis­ing some­thing that’s, uh, too good to be true. Appar­ent­ly.

[00:08:02] Tony: Is that what they said?

[00:08:03] Cameron: That’s one of the def­i­n­i­tions of click bait. I appealed their rul­ing. And they told me to take a long walk as a result. So yeah. No, no dis­cus­sion. No, I, I no chance to present my case. Have a look at the dum­my port­fo­lio. It’s doing dou­ble mar­ket.

[00:08:24] Cameron: So when I say we get dou­ble mar­ket, no, just no click­bait. You’re out,

[00:08:30] Tony: Or send them, or send them the regres­sion test­ing that, uh, some­one did for us the oth­er week, which

[00:08:34] Tony: was to say the

[00:08:35] Cameron: send who there is no

[00:08:39] Tony: Send the, send the ai,

[00:08:41] Tony: Google

[00:08:42] Cameron: Barred Google Barred. So that was fun try­ing to find some­one to Google, to talk to, but there’s noth­ing,

[00:08:50] Tony: Oh dear.

[00:08:50] Cameron: like talk­ing into a, into the Grand Canyon, man. There’s noth­ing there. So that’s, uh

[00:08:55] Tony: Well, if any­one knows some­body

[00:08:56] Tony: who works at Google, please put in a good word for us.

[00:09:00] Cameron: Uh, Jor­dan Gibbs. Tony one of, uh, actu­al­ly I should check to make sure that he’s told me I can talk about this. I did email him. Let’s see. Jor­dan. Yes, mate, go for it. Oh, good. Okay. Jor­dan Gibbs, one of our club mem­bers, has been doing his own regres­sion test­ing and, um, sent me an email update on this, uh, the oth­er day, which I shall read.

[00:09:26] Cameron: Hi, Cam. I thought I’d give you an update on the regres­sion test­ing. I did. Unfor­tu­nate­ly, I’m not a cod­ing wiz­ard, so I did it the old fash­ioned way of hav­ing thou­sands of slaves walk­ing in the fit no, uh, of work­ing my way. Not that old fash­ioned.

[00:09:40] Tony: All right. How are the pyra­mids

[00:09:42] Cameron: Yeah, exact­ly. One slave at a time, uh, of work­ing my way through the var­i­ous buy lists start­ing in Sep­tem­ber 21.

[00:09:50] Cameron: At the time, this was the ear­li­est buy list I had. After lis­ten­ing to one of the pod­casts and hear­ing about Char­lie cham­pi­oning qual­i­ty over cheap stocks, I want­ed to check if I used a QAV score of 0.1 as the cut­off, but sort­ed stocks by the qual­i­ty score, if it would pro­duce bet­ter results. Over­all, it pro­duced basi­cal­ly the same result as the dum­my port­fo­lio, 8.9% CAGA for the qual­i­ty stocks ver­sus 4.43% CAGA for the ref­er­ence port­fo­lio.

[00:10:23] Cameron: And then he is writ­ten VAS in brack­ets after that. Do you know what

[00:10:28] Tony: No, I, when I read it, I just assumed he was say­ing that his regres­sion test­ing got rough­ly dou­ble mar­ket. So I’m assum­ing VAS might have been

[00:10:38] Tony: the index. I don’t know

[00:10:41] Tony: what the, what it means though.

[00:10:42] Cameron: oh. Um, Van­guard might be a Van­guard thing.

[00:10:46] Tony: Yeah.

[00:10:47] Cameron: Lemme look it up. S‑D-S-V-A‑S. Do, do, do do. Stock does­n’t know what it is. Oh yes. Van­guard Aus­tralian. Shares. Index.

[00:11:01] Tony: Yeah, you are right. Well done. You are get­ting good, aren’t

[00:11:03] Cameron: at me, man. I tell you what. Guru, Guru, I saw it and thought Vaz Def­er­ens was the first thing I saw when I looked at it.

[00:11:13] Cameron: You know, because I’m still suf­fer­ing PTSD from when I had the snip a cou­ple years ago.

[00:11:20] Tony: oh real­ly? I still haven’t had it.

[00:11:21] Cameron: Oh. Died, died. I still can’t go near a bag of frozen peas. One of the, th one of the, back to back to Jor­dan. Sor­ry about that, Jor­dan. One of the things I did­n’t con­sid­er before I start­ed was that the qual­i­ty score only real­ly changed after a com­pa­ny has report­ed. So the order remained fair­ly sta­t­ic between report­ing peri­ods.

[00:11:47] Cameron: I nev­er held dou­ble posi­tions instead sit­ting on cash until some­thing new was avail­able to buy. But I did buy and sell the same stock a few times because of this. Some stats of the test test peri­od. 6 9 21 to 6 1 24. Total num­ber of stocks held 155. It’s a lot of stocks to hold over a lit­tle bit,

[00:12:09] Tony: Oh yeah, you prob­a­bly turned it over a few times in three years.

[00:12:12] Tony: Yeah.

[00:12:12] Cameron: Total num­ber Stocks lost mon­ey on uh, 103 total loss­es. Sev­en­ty-four thou­sand 900 twen­ty-one dol­lars total prof­it 117 800 nine­ty-four dol­lars six­ty-three per­cent of prof­it came from eight stocks based on some of the oth­er stuff dis­cussed on the show recent­ly. I also test­ed hug lines on the data sets.

[00:12:34] Cameron: These will not be exact­ly right as I was only look­ing at it graph­i­cal­ly and not check­ing the low prices for the stock. In between the data graphed, I test­ed any stock I held for more than 90 days. Assum­ing any­thing less than this would be less like­ly to be sub­ject to a spike and sell-off and maybe pre­ma­ture­ly sold off by the hug line.

[00:12:54] Cameron: The two hug lines I checked were three PTL drawn on a one-year week­ly graph, and a three PTL drawn on a three-year week­ly graph. Over­all, fifty-one stocks met this cri­te­ria. For sim­plic­i­ty, I only com­pared the change in cap­i­tal val­ue and did not include div­i­dends or real­lo­ca­tion of cap­i­tal sold soon­er, etc.

[00:13:17] Cameron: Is that how you would draw hug lines if you were to draw hug lines? Tony?

[00:13:21] Tony: Uh, prob­a­bly would’ve gone three-year, month­ly rather than three-year week­ly. But, um, I’m hap­py to get the results from what he’s done.

[00:13:29] Cameron: The total val­ue of the fifty-one stocks sold using nor­mal rules 502,400 six­ty-eight. The total val­ue of the fifty-one Stocks sold dur­ing nor­mal rules plus a one-year. Week­ly hug line 505,100 nine­ty-sev­en or a 0.5% Increase total val­ue of the fifty-one. Stocks sold using nor­mal rules in a three-year.

[00:13:54] Cameron: Week­ly hug line, 511,200 thir­ty-four or 1.7% increase. Um, 1.7% over, uh, what is it, like two and a half years, uh, rough­ly.

[00:14:11] Tony: what was it, a hun­dred fifty-five stocks.

[00:14:13] Cameron: Yeah.

[00:14:13] Cameron: That does­n’t sound like a big, uh, improve­ment.

[00:14:19] Tony: No, and look, it’s an improve­ment. So there’s some­thing in there, but it’s not, it’s not sta­tis­ti­cal­ly sig­nif­i­cant

[00:14:25] Tony: enough I would’ve thought to change the rules. Yeah.

[00:14:28] Cameron: he says. I also drew all of the scor­ing data out of the buy list to see if there was any con­sis­ten­cy in item scor­ing high­ly in a spe­cif­ic cri­te­ria and doing well over­all. A few things of note here, although the sam­ple size is tiny at the moment, of the eight stocks that made more than 50% prof­it, six scored a two on the finan­cial health trend score sev­en were nei­ther a star growth or income stock five had a strong finan­cial health score, and the oth­er three were recov­er­ing. Of the 103 stocks that I made a loss on eighty-three had a strong finan­cial health score. Over­all, I don’t think the test­ing pro­vid­ed any­thing that would change the plan, but thought you guys might find it of inter­est, spread­sheet is attached, etc. Etc. Thank you for that, Jor­dan. All

[00:15:20] Tony: Yeah, I thought that last sec­tion was real­ly inter­est­ing ’cause it’s, it’s close to my think­ing as well that some of the things that we put a one or a zero on in the check­list might need to be weight­ed dif­fer­ent­ly. And the one that stuck out for me on those, that last sec­tion where we talked about the eight stocks that made more than half the prof­it were the ones that were, he said five had strong finan­cial health score and the oth­er three were recov­er­ing.

[00:15:42] Tony: And I, I’ve long thought that recov­er­ing is, um, a, a poten­tial good space for us to look at as investors. And so I’ve start­ed doing a tri­al of recov­er­ing stocks. I’ve been doing it since the 18th of Sep­tem­ber, just a lit­tle, uh, port dum­my port­fo­lio on a spread­sheet, and that’s up 5% since the 18th of Sep­tem­ber ver­sus 3% for the SDW.

[00:16:06] Tony: So I, I think there is some­thing in maybe putting more empha­sis on recov­er­ing stocks. So, um, I’ve been doing this for a few of those dif­fer­ent things, um, in our check­list, dif­fer­ent met­rics, just sim­ply fil­ter­ing the buy list on that one dimen­sion and then pick­ing the top

[00:16:25] Cameron: Mm

[00:16:26] Tony: Um, I’m gonna wait until we go through this report­ing sea­son, so maybe in March or April when things have set­tled down and I’ll check the results and then that may lead me to change some of the scores on the QAV check­list, or at least change the scores on paper and see how that goes.

[00:16:42] Tony: And then, um, maybe release that lat­er on in the year as a per­ma­nent

[00:16:46] Cameron: mm.

[00:16:48] Tony: So, good work. I think that’s great work.

[00:16:49] Cameron: Good job, Jor­dan. Thanks for shar­ing that with us and for let­ting us share it with the peo­ple at home. House­l’s 100 Lit­tle Ideas. Tony, the one I’ve cho­sen for this week is Sys­tem Jus­ti­fi­ca­tion The­o­ry. Inef­fi­cient sys­tems will be defend­ed and main­tained if they serve the needs of peo­ple who ben­e­fit from them.

[00:17:13] Cameron: Indi­vid­ual incen­tives can sus­tain sys­temic stu­pid­i­ty.

[00:17:20] Tony: That’s, uh, yeah. That’s pret­ty uni­ver­sal, isn’t it? I mean, any­one

[00:17:23] Tony: watch­ing, uh, Neme­sis last night would get a face full of that.

[00:17:28] Cameron: oh, that’s the four Cor­ners thing. It’s still going.

[00:17:32] Tony: Yeah. That was Mal­colm Turn­bul­l’s

[00:17:33] Tony: term as prime Min­is­ter ship last

[00:17:35] Cameron: All right. Who is the

[00:17:38] Tony: it’s, it’s the,

[00:17:39] Cameron: Is it? Who’s the neme­sis and

[00:17:40] Tony: there’s always an Neme­sis.

[00:17:42] Cameron: every­one has their

[00:17:43] Tony: Last night, Scum­mo was an Neme­sis for tak­ing down Turn­bull the week before Turn­bull was an Neme­sis for tak­ing down Abbott. Yeah. Um, but yeah, I mean, it’s, that’s the whole, this, this sys­tem Jus­ti­fi­ca­tion the­o­ry was about half our psy­chopath book, was­n’t it?

[00:17:57] Tony: Psy­chopath book. It’s, um, it’s all about insti­tu­tions becom­ing self-serv­ing and want­i­ng to, want­i­ng to con­tin­ue, want­i­ng to con­tin­ue to exist rather than

[00:18:07] Tony: doing the right thing by their mem­bers or their end

[00:18:10] Tony: users.

[00:18:11] Cameron: Well, I, I thought, uh, about fund man­agers and, and the, the invest­ing space, when I

[00:18:18] Tony: Mm-Hmm

[00:18:19] Cameron: there seems to be sys­tems, uh, you know, we’ve talked about this before, how, um, fund man­agers the­o­ret­i­cal­ly speak­ing, uh, may make deci­sions about the, their fund, what they trade in their fund based on how they get paid, their bonus­es, uh, as opposed to

[00:18:41] Tony: mm-Hmm

[00:18:41] Cameron: deliv­er the best long term returns for their investors.

[00:18:46] Tony: mm-Hmm. No. Well, that’s, Char­lie always said, uh, show me the results and I’ll tell you the incen­tives. He’s, he’s right.

[00:18:55] Cameron: Yeah. right.

[00:18:57] Tony: Yeah. Oh, no, for sure. Um, and not so pos­si­bly fund man­agers, but cer­tain­ly pre-Heim, the wealth indus­try in gen­er­al was set up that way. It was, you know, clear­ly, uh, wealth advi­sors offer­ing, uh, what was called a free ser­vice, but real­ly involved, lots of secret trail­ing com­mis­sions would put peo­ple into funds, not because they were the best funds for the indi­vid­ual, but because they paid the high­est trail­ing secret trail­ing com­mis­sion to the wealth

[00:19:24] Cameron: Yeah.

[00:19:26] Tony: Yeah, so that’s, and that’s what you are say­ing. So if the fund man­ag­er want­ed to have a big­ger fund and there­fore get a big­ger incen­tive, they paid the wealth advi­sors a big­ger trail­ing com­mis­sion. So it’s a bit like the Tes­la board, isn’t it? I’m gonna, if I’m Elon Musk, I’m gonna hire the chair­man who does­n’t do any­thing, but give her lots of stock so that, uh, she’ll nev­er, uh, say no.

[00:19:48] Tony: When I ask for an even big­ger bil­lion mul­ti-bil­lion dol­lar pay pack­et.

[00:19:52] Cameron: Did­n’t the judge give her a serve?

[00:19:55] Tony: Oh, yeah.

[00:19:56] Cameron: wow. Uh, yeah. Uh, and Elon was try­ing to pay him­self what, like $55 bil­lion this year or some­thing?

[00:20:07] Tony: Us It was like 80 bil­lion Aus­tralian or some­thing.

[00:20:09] Cameron: Just a reg­u­lar year, you know?

[00:20:12] Tony: Yeah. Or, or he threat­ened to walk

[00:20:13] Tony: out. I’d be like, yeah, don’t let the door hit you on the way out.

[00:20:16] Cameron: no, you would­n’t the guy and no one else. What’s gonna hap­pen to Tes­la if he walks out?

[00:20:22] Tony: You Reck­on, you reck­on you could­n’t hire three of the best auto CEOs in the world to take over for him for like

[00:20:30] Tony: a bil­lion dol­lars each. Save your­self Forty-sev­en

[00:20:33] Cameron: Oh, you could.

[00:20:34] Tony: still get the same

[00:20:35] Cameron: You could hire them, would you get the same

[00:20:37] Cameron: results.

[00:20:37] Cameron: No, I don’t think so. I don’t think any­one’s able to, I don’t think any­one’s able to do what Elon’s able to do in that space­man. Like

[00:20:44] Cameron: he’s, have you read the Wal­ter Isaac­son biog­ra­phy on

[00:20:47] Tony: No, I haven’t. It’s on my,

[00:20:50] Cameron: Like the guy for all of his

[00:20:54] Cameron: flaws as a human being.

[00:20:56] Cameron: Um, you know, it’s that thing that we saw with jobs and we saw with Gates in the ear­ly days. He’s able to take mas­sive risks and, you know, close to shut­ting down the farm risks, which he’s made a num­ber of times because of his per­haps psy­cho­path­ic lev­el of self-belief or lev­el of. You know, the risk is worth it.

[00:21:25] Cameron: You know, it’s worth tak­ing these mas­sive risks. And if it fails, it fails. And you know, it’s my mon­ey and I, you know, like he blows up rock­et ships in order to make progress. If I have to blow up the com­pa­ny to, you know, if I try and I end up blow­ing up the com­pa­ny, well I just failed. Next does­n’t

[00:21:44] Tony: So the quick, no, I don’t, I don’t dis­pute that. But the ques­tion is, is Tes­la the car com­pa­ny now a mature indus­try? Like were a, were a respon­si­ble CEO, say Elon, go your hard­est on get­ting peo­ple to Mars, blow­ing up rock­et ships, putting big drills between San Fran­cis­co and

[00:22:03] Tony: la,

[00:22:04] Cameron: ai Twit­ter,

[00:22:06] Tony: ai.

[00:22:06] Tony: That’s, you’re good at that, mate. This is, this is now the, the car com­pa­ny, which is the bread and but­ter for them is now a mature busi­ness. Should­n’t we get in some­one to run that? Do we do it? Do we need to make bet the com­pa­ny on every

[00:22:18] Tony: next move for Tes­la, the car com­pa­ny?

[00:22:20] Cameron: I don’t think it is a mature busi­ness. I, I think he’s only just start­ed

[00:22:24] Cameron: with Tes­la. I mean, Tes­la’s not a car com­pa­ny any­way. It’s a robot

[00:22:28] Tony: well, accord­ing to, accord­ing to Elon, it’s a, it’s a soft­ware

[00:22:32] Cameron: well, it’s that, and it’s a robot com­pa­ny.

[00:22:33] Cameron: It’s the Opti­mus. That’s what he’s work­ing towards now, is the Opti­mus.

[00:22:39] Tony: yeah. And look, you, you, you, you’re poten­tial­ly right. My the­o­ry, my hypoth­e­sis is that the oth­er car com­pa­nies are going to cut Tes­la of the car com­pa­nies lunch and BYD is already doing that now. But, um, you know, the Ger­man brands are gear­ing up, the Japan­ese brands are gear­ing up. The Amer­i­can brands are hope­less except for Tes­la.

[00:22:59] Tony: But, um, but yeah, he’s gonna face very, very stiff com­pe­ti­tion from oth­er car man­u­fac­tur­ers going for­ward.

[00:23:06] Cameron: It did­n’t, was­n’t one of the Tes­las, the biggest sell­ing car in the world last week? As of last week, Tes­la Mod­el Y was not only the best sell­ing car in Chi­na and Europe last year. It was the best sell­ing car in the world. The Tes­la mod­el Y was the world’s best sell­ing vehi­cle in 2000 twen­ty-three, accord­ing to pre­lim­i­nary data that Elon, that Elon gave from.

[00:23:31] Tony: I’m not sure. I’m not sure that’s gonna, I’m not sure that’s gonna con­tin­ue is my, my com­ment. When you can buy, you know, a BMW EV for half the price as a Tes­la, or the same

[00:23:44] Tony: price as a Tes­la, or you know, a BYD for half the price, why are you gonna buy a

[00:23:48] Cameron: Who said you’ll be able to buy for

[00:23:49] Cameron: half a price. you know, I mean, you know, Elon’s mas­ter plan that he, he released when he start­ed Tes­la, he said is he said, I’ve got a three point mas­ter plan. I’m gonna tell you what it is. The first one was, make a real­ly expen­sive elec­tric sports car. Sell that. Uh, yeah, I saw that.

[00:24:09] Cameron: Uh, we got lit­tle thumb pop­ping up, icons appear­ing in, uh,

[00:24:13] Tony: There is again.

[00:24:14] Cameron: did it. Um, you’re gonna make a real­ly expen­sive sports

[00:24:17] Cameron: car, elec­tric sports car. Use the prof­its from that to make a less expen­sive sports car for the mid­dle class. Use the prof­its from that to make a cheap­er sport, a cheap­er elec­tric car that every­one can afford.

[00:24:31] Cameron: So, and then use that to build robots. But that, that came lat­er. I, I mean, I think this was always his plan is to, you know, start off real­ly lux­u­ry end of the mar­ket and then con­tin­ue to dri­ve the price down. Whether or not he can ex

[00:24:45] Tony: And, and so that three point plan

[00:24:47] Tony: is worth, is worth pay­ing him $80 bil­lion a year, is it?

[00:24:50] Cameron: Hey, that’s between him And the share­hold­ers of Tes­la.

[00:24:54] Tony: Well, the share­hold­ers just sued

[00:24:56] Cameron: it did. and

[00:24:56] Cameron: the judge was like, you you’re kid­ding.

[00:25:00] Tony: Judge went hell yeah.

[00:25:03] Cameron: Well, you got­ta love.

[00:25:04] Tony: But not only that, the judge also said the last time they were sued, they got out of it because, uh, what’s her name? Robin Den­ham, I think is the chair­man. Chair­per­son was meant to set up a, uh, a com­mit­tee that was going to fil­ter Elon’s, um, tweet­ing and, and PR dis­as­ters. And the judge said,

[00:25:25] Tony: how many times has that com­mit­tee done any­thing?

[00:25:27] Tony: Zero since then. I was like,

[00:25:29] Cameron: Well, the judge must have read

[00:25:30] Tony: you’re pay­ing lip ser­vice.

[00:25:31] Cameron: book because that was the rec­om­men­da­tion is Psy­chopaths are fine, but you need to ring-fence them with a com­mit­tee of peo­ple that aren’t psy­chopaths that can assess the deci­sions they’re mak­ing and say, is

[00:25:45] Tony: yeah, They’re like a drag­on on game of Thrones. Right. You put them in, put them in a col­lar, nail ’em to the floor, and when you need to take over some­thing, unleash the mask. Mm

[00:25:57] Cameron: Yeah. You wan­na, you wan­na fig­ure out how to lever­age the strengths of the psy­chopath with­out let­ting the neg­a­tives of the psy­chopath cre­ate hav­oc that no one’s gonna recov­er from.

[00:26:09] Tony: Pay

[00:26:09] Tony: this psy­chopath $80 bil­lion a year.

[00:26:13] Cameron: Well, he’s, he’s,

[00:26:15] Cameron: got a

[00:26:15] Cameron: lot of alimo­ny pay­ments, uh, Tony.

[00:26:19] Tony: Well, I think isn’t, isn’t the exact amount, the amount he’s lost on

[00:26:22] Tony: Twit­ter and he’s pur­chase of

[00:26:23] Cameron: Yeah, yeah, yeah. Any­who, mov­ing right

[00:26:27] Tony: tell you what I’m get­ting sick of. I’m get­ting sick of peo­ple in the media say­ing, and then, so-and-so Tweet­ed, uh, or now called X, or X, for­mer­ly known as Tweet Twit­ter. They just like, no one’s let go of the brand­ing yet, no one’s

[00:26:40] Tony: adopt­ed a new brand­ing.

[00:26:42] Cameron: Yeah.

[00:26:43] Tony: Mm-Hmm

[00:26:44] Cameron: Uh, speak­ing of brand­ing, did you see he did his first brain implant last week, the new,

[00:26:50] Tony: mm.

[00:26:50] Cameron: chip, and he said the first prod­uct that

[00:26:53] Cameron: Neu­ralink will be rolling out is called Telepa­thy, not Telepa­thy. X or Xepa­thy or Telepath. X, Just Telepa­thy.

[00:27:04] Tony: have Twit­ter, you can have your Twit­ter behind your own fire­wall and your own

[00:27:07] Tony: brain. That’d be great.

[00:27:08] Cameron: Fan­tas­tic. let Leon let Elon into

[00:27:12] Cameron: your eon, into your brain. Any­who, mov­ing right along. Uh, that’s all

[00:27:18] Tony: Oh, by the way, that was a good futur­is­tic pod­cast this

[00:27:20] Tony: week. I thought it was

[00:27:21] Cameron: Oh, You lis­ten to that? Yeah. Thanks. Yeah.

[00:27:23] Tony: Mm-Hmm. Of course I do.

[00:27:25] Cameron: You like my Cams nine Futures?

[00:27:29] Tony: Yes. I, I, the one I favored was the one where the AI just dis­ap­pears. Like it’s, to me, well, to me, you’ve got­ta ask your­self the ques­tion, is human intel­li­gence the pin­na­cle of any pos­si­ble intel­li­gence? Eh, prob­a­bly not. Which means there are more intel­li­gent things out there who might be all around us, but they’re just invis­i­ble ’cause they’re so super intel­li­gent.

[00:27:50] Tony: They live in quan­tum com­put­ers, in the rocks or the air or what­ev­er. Um, or what­ev­er, what­ev­er, what­ev­er form the intel­li­gence takes. And so AI will opti­mise our intel­li­gence, but even­tu­al­ly it’ll go, yeah, that’s a nice start, but I can do bet­ter. And then just dis­ap­pear,

[00:28:06] Cameron: which is why We need to merge with it. That’s Steve’s num­ber 10. Corol­lary.

[00:28:11] Tony: Yeah. Go on for the

[00:28:12] Cameron: Yeah. Go on for the ride. Yeah. It’d be so dis­ap­point­ing if

[00:28:15] Cameron: we, if the intel­li­gent quo­tient of the plan­et’s going up and up and up and up and they, and then it just dis­ap­pears and we’re like, oh,

[00:28:22] Cameron: we’re back. We’re just alone again now.

[00:28:24] Cameron: Oh shit.

[00:28:26] Tony: We’ll be like that. Uh, the Three-Body prob­lem will be like the earth wait­ing for the inva­sion. ’cause our tech’s being

[00:28:31] Cameron: Hey, when does that start? Is that out yet? It’s got­ta be com­ing out

[00:28:34] Tony: No, it’s sup­posed to be up this year. Yeah.

[00:28:37] Cameron: Look­ing for­ward to see­ing

[00:28:39] Cameron: how bad­ly they screw that up. Um, uh, what have you got to talk about TK?

[00:28:47] Tony: Well, I did­n’t have much, but I’ll do a cou­ple of things. So, um. We were talk­ing off air before­hand about the dif­fer­ent port­fo­lios, tri­al port­fo­lios I’ve set up. And one thing I’ve, I’ve looked at a cou­ple of years ago and then dis­missed ’cause it, it, it was, um, basic, well basi­cal­ly what I was try­ing to do is find a way to val­ue-grow stocks and, uh, you know, when After­pay was tak­ing off and all that kind of stuff.

[00:29:12] Tony: And, and I revived that same think­ing again recent­ly because I’d noticed that some of the stocks on the very bot­tom of our buy list, so with a QAV score of zero, um, and that were, were also, you know, trend­ing upwards, et cetera. Um, were doing real­ly well. So I put togeth­er a port­fo­lio back in Novem­ber of what I call the anti-QAV stocks.

[00:29:32] Tony: And it’s doing triple mar­ket, right? It’s up 21% in a cou­ple of months ver­sus 6% for the SDW, which is good, but it’s only a cou­ple of months. And I know from expe­ri­ence in the past that. And you can see it on the five, the five-year graph. The stocks on this list, like, uh, Mega­port and Pro Medicus come to mind straight away.

[00:29:52] Tony: Um, that they can have sev­en­ty-five per­cent pulled ends when, when things go, you know, when things blow up in the growth side of things, their PEs are so high that they can cut right back. So that’s why I haven’t owned them. But what, what I am think­ing now is I’m won­der­ing if, if growth stocks and QAV stocks form some kind of hedge against each oth­er.

[00:30:12] Tony: So going back to the Stock­o­pe­dia research, which said that there is three types of invest­ing method­olo­gies that have beat­en the mar­ket over time. Two, that we use in QAV. So val­ue stocks, um, well three actu­al­ly val­ue stocks and momen­tum. I think there’s also qual­i­ties, maybe there was

[00:30:30] Tony: Four. types, val­ue, val­ue stocks, qual­i­ty stocks and momen­tum.

[00:30:34] Tony: But they also

[00:30:35] Cameron: There are four ways that you

[00:30:38] Cameron: val­ue stocks

[00:30:40] Tony: Car­di­nal Fang. Read the, read the charges. Uh, no, there’s four. Um, and we have three in QAV any­way, which was val­ue, qual­i­ty, and momen­tum. And the fourth one was growth. So I’ve been play­ing around with that. Um, if any of the regres­sion testers who are lis­ten­ing want to go back and have a look at those stocks and see when they go up and when they go down, see if we could, uh, trade in out at the right times using three-point trend lines.

[00:31:08] Tony: See if it was a nat­ur­al hedge for QAV stocks, um, that’d be good. Although, as you point­ed out before, we’re still doing dou­ble mar­ket in QAV. So, um. We may not need a nat­ur­al hedge for it, but it’d be, I’m gonna play around with that and just see where it goes. Uh, I guess I’m also call­ing out that, uh, if this con­tin­ues to work, I may buy a stock or two on this list just to take it from paper to the real world and see if I can trade it.

[00:31:33] Tony: So don’t, don’t get all square­ly and send me ques­tions about why, you know, a stock like Prometi­cus or Mega­port or some­thing sud­den­ly appears on our declared stock list. But, um, that’ll be the rea­son. I’m just

[00:31:46] Tony: try­ing to test some­thing.

[00:31:47] Cameron: Wow, the anti-QAV, if you put the QAV and the anti-QAV togeth­er, does it, like, wipe each oth­er out? Yeah.

[00:32:00] Cameron: Do you get super­pow­ers,

[00:32:03] Tony: Oh, that’d be good.

[00:32:04] Cameron: invest­ing

[00:32:05] Tony: Yeah. Yeah, that’d be

[00:32:07] Cameron: So the ques­tions I had for you off-Air are like, well, um, how do you deter­mine when you’re in growth fa growth invest­ing mode ver­sus val­ue invest­ing mode?

[00:32:20] Cameron: And, you know, how do you know when to get out? Like when­ev­er we’ve talked about growth stocks over the years, one of the ques­tions has always been, how do you know when to get out? Do you use three-point trend lines? Do you use all the nor­mal rules?

[00:32:34] Tony: Well that’s what I’m think­ing. So I’ve got­ta test that. Um, I use the nor­mal rules to get into these stocks. Um, so the ques­tion is, do the nor­mal rules also work get­ting out? ’cause a lot, you know, a lot of them will have the kind of duro tech prob­lem where they’ll, they’ll go up quite steeply towards the end.

[00:32:50] Tony: So whether

[00:32:51] Tony: the three-point trend line works with them or not, I’ve got­ta research. Yeah.

[00:32:55] Cameron: And they But you don’t, and you don’t fol­low the rules to get in. You’re, you’re doing the anti-rules.

[00:33:08] Cameron: That’s it.

[00:33:11] Tony: Yeah,

[00:33:11] Tony: that’s it. Plus, plus they’ve got­ta be a, a very poor QAV

[00:33:15] Cameron: Yeah. I mean, if you’re gonna invert, has to have a very poor QAV skill. High­est, high­est PE in the last six peri­ods? Low,

[00:33:27] Cameron: no. Con­sis­tent­ly increas­ing equi­ty. Very poor finan­cial health. Uh, very high prop, CAF, you know,

[00:33:38] Tony: Yeah. It’s like, why are peo­ple buy­ing this stock? Right. Just pure­ly for growth. ’cause the, the fore­cast earn­ings per share must be great, and I haven’t looked into it that deeply, but that might also lead into a, you know, a rescor­ing of our fore­cast earn­ings per share met­rics on the buy list too.

[00:33:58] Tony: So I’m just research­ing this and see where it takes

[00:34:00] Tony: us.

[00:34:01] Cameron: wow, that’s, uh, almost hereti­cal. I, I feel like I need to go to con­fes­sion now. I need to have my sins washed away from hear­ing you say that. I feel dirty.

[00:34:11] Tony: Well, or I’ll refer you to Mor­gan Housel who says that, uh, sys­tems will be defend­ed and

[00:34:17] Tony: main­tained if they serve the needs of the peo­ple who ben­e­fit from them.

[00:34:20] Cameron: Well, obvi­ous­ly our sys­tem’s not meet­ing your needs, so you’re not defend­ing it.

[00:34:25] Tony: Well, and that’s, that’s the truth. I mean, it’s no secret over the last cou­ple of years I’ve under­per­formed, um, even the dum­my port­fo­lio, which is I think is, you know, pos­si­bly because it, I’ve got a large cap, um, val­ue stock port­fo­lio.

[00:34:38] Tony: But, uh, if this is a good hedge for it, then I’m all

[00:34:41] Tony: for it.

[00:34:42] Cameron: Well, speak­ing of which, I did do some research dur­ing the week. Remem­ber, like I did my, um, analy­sis, uh, uh, I know a cou­ple of months ago of, of the light port­fo­lios look­ing at the three-point trend line, um, and, and. Rule one sells.

[00:35:05] Cameron: And if, if I had ignored those, whether or not the port­fo­lio would be bet­ter off or less off, I did fil­ter that over the week just to look at the ASX 300 stocks

[00:35:22] Tony: Right.

[00:35:22] Cameron: see if, um, if I’d ignored rule one and three point trend lines with those, that com­po­nent of the port­fo­lio, whether or not it would’ve been done bet­ter over that peri­od of a cou­ple of years, uh, ver­sus how it has done.

[00:35:41] Cameron: And, uh, again, like the full test, it was, you know, slight­ly bet­ter but mar­gin­al, like not, not, not real­ly worth writ­ing home about over a cou­ple of years, you know, a cou­ple of per­cent,

[00:35:52] Cameron: but

[00:35:52] Tony: Okay.

[00:35:53] Tony: yeah.

[00:35:54] Tony: and I’ve also been try­ing a 20% stop-loss, and it looks like the, one of the stocks I’m try­ing it with is about to. It’s like about neg­a­tive 17%, so it’s like­ly to go neg­a­tive 20 soon. So I’m not sure whether that’s the right thing to

[00:36:07] Tony: do or not as well

[00:36:10] Cameron: Well, as you know, and I think I may have men­tioned one of our lis­ten­ers, Matt, uh, is work­ing on a, an auto­mat­ed regres­sion test­ing sys­tem, which sounds like he’s got it up and run­ning. He sent me the, the code for it last week. I’ve tried to get it run­ning on my machine, not quite work­ing for me yet, but I, I think based on his work, we are very close to hav­ing some­thing where we can just plug in a ton of vari­ables, iso­late vari­ables, and he’s got like 30 years of fun­da­men­tal data that we can plug into it.

[00:36:42] Cameron: And, um, of every­thing,

[00:36:45] Tony: Oh, that’s bril­liant.

[00:36:46] Cameron: val­ue stocks, and every­thing in between are just real­ly.

[00:36:51] Cameron: Test these things out in a rel­a­tive­ly quick, uh, man­ner. So if we can make that work, that’ll, we can

[00:36:59] Tony: Yeah.

[00:36:59] Tony: That’s bril­liant.

[00:37:01] Tony: I think QAV, goes to The next

[00:37:02] Tony: lev­el when we can make that

[00:37:03] Cameron: Yeah.

[00:37:04] Cameron: So we’ve got QAV, anti-QAV. The next lev­el QAV is

[00:37:09] Tony: Yeah. It’s the QAV uni­verse.

[00:37:11] Cameron: Qavu. Qua­vu. Oh, I like that.

[00:37:15] Tony: The vu. Yeah. The QAV uni­verse. Yeah. That’s great. You can be

[00:37:19] Tony: Dr. Strange.

[00:37:24] Cameron: All right.

[00:37:25] Tony: I’ll be, I’ll be Tony Stark.

[00:37:29] Cameron: That’d be your super­hero name. Just Toe­cut­ter. What have you got out? What else have you got to talk about TK?

[00:37:36] Tony: I pulled pork, which was a request from last week.

[00:37:39] Cameron: before we move

[00:37:39] Cameron: on,

[00:37:40] Tony: Hmm.

[00:37:41] Cameron: RBA should have,

[00:37:42] Cameron: uh.

[00:37:43] Tony: Yeah.

[00:37:44] Cameron: rates out by now, should­n’t they? RBA keeps inter­est rates steady at 4.35%, so

[00:37:51] Tony: it’s not sur­pris­ing.

[00:37:52] Cameron: go. Has the mar­ket respond­ed? Not yet, no.

[00:38:00] Cameron: Okay. Sor­ry. Keep going,

[00:38:03] Tony: No, that’s all right. We should have, I should have men­tioned that ear­li­er, but yeah, I’m not sur­prised. I did see some research over the week­end and Alan. Cole was report­ing that sug­gest­ed that the infla­tion was, should already be back into the below 3%, which is the RBA range. But I think the fig­ures that they’re look­ing at now were for the last quar­ter, so they haven’t arrived at that con­clu­sion yet, which makes me think that maybe in two or three months time they’ll start cut­ting rates, which I think is about the con­sen­sus in the mar­ket.

[00:38:33] Tony: So the mid­dle of the year, there’ll be some rate cuts. But any­way, that’s pre­dic­tion and it does­n’t, does­n’t wor­ry me one way or the oth­er.

[00:38:41] Cameron: No. Okay.

[00:38:44] Tony: Okay. Met­cash. Met­cash. Yeah. You don’t, don’t need to check your dum­my port­fo­lios to see if you own Met­cash before I talk about it, because it’s not on the buy list. It’s, um, not quite an anti-QAV stock, but it does­n’t have a very high score. Um, I think most peo­ple will be famil­iar with Met­cash. The com­pa­ny, uh, it, it, uh, is a super­mar­ket hard­ware store and liquor group, whole­saler and fran­chis­er, I guess.

[00:39:12] Tony: Um, oper­at­ing brands like IGA and Food­land, uh, home Hard­ware, Mitre 10 Cel­e­bra­tions Liquor store, those kinds of things. So you all the Aus­tralian lis­ten­ers will have come across those from time to time and may even use IGA for their week­ly shop­ping or Mitre 10 to, to do their DIY long and sto­ry his­to­ry.

[00:39:35] Tony: This com­pa­ny, which I always find inter­est­ing, uh, the his­to­ry of Met­cash goes back to. The ear­ly days of super­mar­kets in Aus­tralia in 1927 in Wool­loomooloo when, uh, a guy called Joe David opened his, uh, first store and called it David’s and David’s Super­mar­kets were around for a long time in Syd­ney. So that was 19 twen­ty-sev­en 19 thir­ty-five.

[00:39:57] Tony: Joe David opened a ware­house in Red­fern to sup­ply his stores, uh, but also saw the oppor­tu­ni­ty to sup­ply oth­er stores as well. So. Basi­cal­ly start­ed the whole­sale super­mar­ket sup­ply busi­ness in Aus­tralia. Uh, so the fast for­ward, the six­ty-eight and David’s expands into liquor 1980. They, um, had a big acqui­si­tion, a com­pa­ny called A.G Camp­bel­l’s, which was a, a large super­mar­ket whole­sale busi­ness in Aus­tralia.

[00:40:26] Tony: And then in the eight­ies, uh, they were the first to intro­duce scan­ning and label­ing to Aus­tralia, eighty-eight. They intro­duced the, the retail ban­ner Inde­pen­dent Gro­cers, Alliance, which is of course IGA. And in 2000, rebrand­ed as Met­cash after South African Com­pa­ny, Metro Cash and Car­ry took a major stake and they stayed with them in only about four or five years.

[00:40:53] Tony: And, and then sold out 2005. Met­cash acquires Food­land asso­ci­at­ed 2010. They acquire and con­vert that brand to IGA and then they start to branch out into oth­er areas, uh, includ­ing hard­ware. So in 2010, they, uh, I hes­i­tate to say acquired, they did a deal with Mitre 10. So, um. Because they’re a whole­saler and fran­chis­er, I’m not quite sure acquir­ing is the right term.

[00:41:22] Tony: They basi­cal­ly sign up com­pa­nies and become, uh, come under the sta­ble of Met­cash Sup­ply and then, uh, uh, con­vert to fran­chise arrange­ments as well occa­sion­al­ly. Um, and I think that was a smart move because the, the super­mar­ket whole­sale games a tough one. There’s of course, two major com­peti­tors. Three real­ly, if you count Aldi.

[00:41:43] Tony: Coles were worse than Aldi in Aus­tralia. So it made sense for them to diver­si­fy a bit into hard­ware and liquor, and they’re, um, they’ve kicked, cer­tain­ly kicked some goals in both of those areas over the years as well. Uh, what else can I say about them? So I, I guess the point I’m mak­ing is essen­tial­ly they’re, they’re a whole­saler, but they do have some ele­ment of con­trol over brand.

[00:42:02] Tony: Some­times as a fran­chis­er of the retail out­lets. Some­times as a part of their whole­sale deal, they’ll do store refurbs and refits, and some­times they actu­al­ly oper­ate the out­lets, uh. The oth­er thing to note is that I think today they came back out of a trad­ing halt, but they’ve just raised $300 mil­lion to acquire the food dis­tri­b­u­tion com­pa­ny, Supe­ri­or Foods.

[00:42:26] Tony: And that’s a, that’s a busi­ness that, uh, sup­plies, cafes and restau­rants. Um, they’re also using some of that fund to acquire a cou­ple of hard­ware sup­pli­ers, Bian­co and Alpine. And that’s basi­cal­ly been the his­to­ry of this com­pa­ny in the last, say, 20 years. They, they either take on debt or raise cap­i­tal and then go and, uh, con­sol­i­date in the, in the indus­tries.

[00:42:46] Tony: And if you think about retail­ing, uh, you know, there, it’s a bit like in the US when there’s Wal­mart, which you know, has put a lot of small com­pa­nies out­ta the busi­ness, but then there are net­works of the sort of small mom and pop stores that band togeth­er to, to fight Wal­mart. And I guess Met­cash is the kind of, um. Con­glom­er­ate of those sort of mom and pop sort of stores. So for exam­ple, um, on the, on the hard­ware side, uh, with home and with, uh, Mitre 10 and recent­ly with a com­pa­ny called Total Tools, which is num­ber one in, its, its mar­ket of pro­vid­ing, um, tradies with pro­fes­sion­al tools. I can see you smil­ing and um, but, uh, I was talk­ing to, uh, an insid­er from the hard­ware busi­ness recent­ly, and they were say­ing that Mitre 10 and, and Home Hard­ware and Total Tools can do real­ly well up against Bun­nings because it depends on their ser­vice and their, and the, and the store lay­out.

[00:43:44] Tony: But for exam­ple, often­times they’ll, they’ll open across the road from a Bun­nings and then, um, the tradies will go across to the Mitre 10 because it’s got a big­ger, big­ger trade sup­ply sec­tion and does bet­ter ser­vice. Um, and, or they might have a big­ger paint. Sec­tion and the, the Bun­nings or the staff are just bet­ter.

[00:44:02] Tony: And it gets to the point where the, in the paint sec­tion and the Bun­nings store, they’ll refer cus­tomers across to the bet­ter ser­vice that the Mitre 10 across the road. So they’ve kind of, um, grown sym­bi­ot­i­cal­ly almost off Bun­nings as well. And because Bun­nings is the cat­e­go­ry killer, you would­n’t expect anoth­er hard­ware chain to do as well.

[00:44:19] Tony: But, but, uh, Met­cash does oper­ate the num­ber two hard­ware chain, the com­bi­na­tion of Mitre 10 and Home hard­ware and total tools. And the oth­er oth­er area that, um, Met­cash has got­ten into with the hard­ware stores is that they put them into, you know, urban areas. So for exam­ple, uh, there’s one up the road from us on Oxford Street, which is not where you’d expect any tradies to go ’cause there’s no park­ing, um, no real floor plan.

[00:44:46] Tony: It’s kin­da like three sto­ries of hard­ware and they call ’em grab and go store. So they’ll stock things that, you know, a very eager DIY per­son like myself might wan­na go and buy, you know, a pic­ture hang­ing. Frame or pic­ture hang­ing set or a, a drill or some­thing like that. Just grab and go stuff you can car­ry home with you.

[00:45:05] Tony: So that’s a good niche mar­ket for them. So they’ve kind of filled all the gaps that Bun­nings can’t sur­vive. There is talk as well of rur­al areas, for exam­ple, that the estab­lished hard­ware stores there are able to, um, to lob­by the coun­cils to keep Bun­nings out of and they’re suc­cess­ful in those kind of areas as well.

[00:45:21] Tony: Dun­no how much truth there is into that, but, but it cer­tain­ly goes on, uh. So that’s, that’s the kind of met Cash sto­ry, um, to go through their num­bers. And again, it’s not on our buy list, so be aware of that. Uh, the stock price I’m using is, uh, from a day or two ago. It’s $3 64 is the share price. ADT on this com­pa­ny is $9.3 mil­lion, so it’s very big, big enough for most peo­ple to, to buy into.

[00:45:49] Tony: Uh, but the comp, the share price is cur­rent­ly a, it’s just, and it’s one of those ones where the buy line and sell line is start­ing to con­verge in a tri­an­gle. So it’s just, it’s above its buy price, but it’s almost at sell price, which is $3 52. So not too much above that. The share price is above con­sen­sus tar­get, but it’s a long, sor­ry, less than the con­sen­sus tar­get, but it’s a long way above IV one and IV two IV one’s a dol­lar 51.

[00:46:14] Tony: IV two is $2 74. The yield is 6%, which is good. It’s high, but it’s not good enough because we want it to be 6.8% or bet­ter. Stock Doc­tor finan­cial health is ear­ly warn­ing, which I thought was inter­est­ing and it’s con­sis­tent­ly been ear­ly warn­ing for a long time. So that’s not a stock I would like to nec­es­sar­i­ly own.

[00:46:37] Tony: ’cause ear­ly warn­ing, um, isn’t as, you know, finan­cial­ly healthy, as strong or, or recov­er­ing or some of the oth­er ones that are there. But, um, I’m won­der­ing whether, because it’s, it’s a whole­sal­ing type mod­el that, uh, ear­ly warn­ing is, is just how it oper­ates because it’s, it’s not like a super­mar­ket nec­es­sar­i­ly.

[00:46:57] Tony: Where, um, super­mar­kets like the ones that Coles and Wool­worths run, uh, ter­rif­ic busi­ness­es because you gen­er­al­ly, peo­ple shop once a week, so you’re get­ting paid once a week for your stock, but you’re pay­ing your sup­plies once a month. You’ve got, you’ve usu­al­ly got this tremen­dous amount of work­ing cap­i­tal sit­ting there to be used, um, in super­mar­kets.

[00:47:18] Tony: I don’t know if that’s the case with Met­cash because they’re not sell­ing, the retail­er is sell­ing the stock. They’re sup­ply­ing the stock. So they’re being paid month­ly and sup­ply­ing, uh, and invoic­ing month­ly. So I’m won­der­ing whether ear­ly warn­ing is a, is a sort of nat­ur­al part of being a, a, a retail whole­saler.

[00:47:35] Tony: But I haven’t done a deep enough dive to, to look at that. But I’ll call it out. And the finan­cial health is steady ’cause it’s been ear­ly warn­ing for a while. Pea is 12.3, which is almost the last but not quite. So we can’t score it for that. Prop calf is 7.15 times. So it’s above our. Cut off of sev­en, but get­ting pret­ty close to, to being accept­able, but not at the moment.

[00:47:58] Tony: Net equi­ty per share is only a dol­lar 16, so it’s much low­er than the, um, the $3 64 share price. And there­fore we can’t buy this at any­thing like book val­ue. And again, a side­bar to NEPs for this com­pa­ny, net equi­ty per share is a dol­lar 16, but the net tan­gi­ble assets is 24 cents per share. So there’s lots of good­will, um, through acqui­si­tions on the bal­ance sheet.

[00:48:21] Tony: And as I said before, they’re mak­ing a, their busi­ness plan is to con­sol­i­date all the frag­ment­ed retail oper­a­tions, um, around Aus­tralia. So, uh, that’s. Not un again, not unusu­al, and as peo­ple will know from past pod­casts, I’m not nec­es­sar­i­ly against, uh, that kind of good­will acqui­si­tion on the bal­ance sheet.

[00:48:41] Tony: Um, there is the risk that they have to write some­thing down. But the flip side is if you look at, so, uh, the acqui­si­tion of, say, total Tools, which was their last big acqui­si­tion, they’ve kicked some goals with that and they’ve, I think they’ve dou­bled sales in about the last 18 months since they’ve acquired it.

[00:48:54] Tony: So even though there’s, um, good­will on the bal­ance sheet through acqui­si­tions like that, if the com­pa­ny’s under under­ly­ing it or doing well, then it’s worth it. Uh, stock doc­tor has fore­cast earn­ings per share growth of minus 3%. So that’s, uh, some­thing we don’t like to see. Uh, so it gets a, a neg­a­tive for that.

[00:49:12] Tony: There’s no own­er-founder and equi­ty has­n’t been con­sis­tent­ly increas­ing, so there’s not a lot to score on the qual­i­ty side of things for this com­pa­ny. And, and it gets the four out of 16 or twen­ty-five per­cent score. And if you look at, and if you divide that by the, um, the prop CAF, it’s a QAV score of 0.03, which is well below our cut­off of 0.1.

[00:49:33] Tony: So, uh, inter­est­ing com­pa­ny to look at. Um, strengths and weak­ness­es for it. Uh, I like the hard­ware. Busi­ness side of things. I think that was a great idea to diver­si­fy into hard­ware because they’re the num­ber two play­er in hard­ware, which is great, a great space to be in, but they’re the num­ber four play­er in food, which is not a great space to play in.

[00:49:53] Tony: And plus they’re the whole­saler of food, so they’re not get­ting the nor­mal ben­e­fits of a super­mar­ket of, of this kind of work free work­ing cap­i­tal ’cause of trad­ing terms. So, um, made sense for them to diver­si­fy away from that. Uh, some of the oth­er strengths, um, they real­ly have embraced the local store strat­e­gy, both in their super­mar­kets and oth­er busi­ness­es.

[00:50:15] Tony: And they do try and make them­selves the cen­tre of the com­mu­ni­ty often in, par­tic­u­lar­ly in rur­al areas, but even in urban areas, they do a lot of, uh, com­mu­ni­ty sup­port and out­reach and things like that and spon­sor local activ­i­ties. So they try and play up the com­mu­ni­ty side of things. Uh, the, as I said before, the hard­ware is work­ing well against Bun­nings.

[00:50:33] Tony: Um, uh, liquor is num­ber two in its mar­ket, so that, that’s also being doing well. Um. I think the oth­er strength for them is that they’re still con­sol­i­dat­ing a frag­ment­ed mark mar­ket across all these dif­fer­ent cat­e­gories they oper­ate in. And, uh, that’ll come to an end at some stage, but there’s, they’re call­ing out, there’s still plen­ty of oppor­tu­ni­ty there.

[00:50:53] Tony: So that’s the strength for them. On the risk side or the weak­ness­es side, um, I real­ly think the food side is, um, is the biggest risk. Coles and Woolies have done a lot of exper­i­ment­ing with, with small foot­print stores like Cold Express, and I for­get now what the Wool­worths brand is. It’s Metro, Wool­worths, Metro, um, which must be eat­ing into IGA’s ter­ri­to­ry.

[00:51:17] Tony: Aldi, uh, has also also sim­i­lar sort of strat­e­gy to IGA, so that must also be com­pet­ing strong­ly against them. So I see, I see food as being a tough busi­ness to be in. And then the fourth largest in food. So retail­ing is all about hav­ing a com­pet­i­tive price, and if you’re the fourth largest, you’re not gonna get the best trad­ing terms.

[00:51:37] Tony: New sup­pli­ers. So they do have to play up the con­ve­nience side of things ’cause they’ll, they’ll nev­er get down to match the, the majors, I don’t think so that’s gonna be an issue for them. Um, I think brand­ing frag­men­ta­tion is an issue for them and, and that might be solv­able over time, but they’ve got some stores as food land.

[00:51:53] Tony: Some stores as IGRI think some are super val­ue. There’s quite a lot of dif­fer­ent brands in the mar­ket and they could prob­a­bly ben­e­fit from hav­ing an over­ar­ch­ing brand, which will then get some recog­ni­tion or bet­ter recog­ni­tion and stronger val­ues asso­ci­at­ed with it. Um, they’re, they’re going through a major IT upgrade, which is always dif­fi­cult, espe­cial­ly for a, um, you know, these are, this is a big com­pa­ny but not the biggest in the area.

[00:52:16] Tony: So a small­ish, um, retail­er in Aus­tralia so that there could be some risk with that. Uh, I put a ques­tion mark on the fran­chise mod­el. Um. I worked in the fran­chise sys­tem at Shell, and it’s a tough one because you are always hurt­ing caps to try and do what you want. You see it as being best for the fran­chise, but in some local areas it may not be.

[00:52:38] Tony: And then it’s a, you know, it’s a, um, an exer­cise in nego­ti­a­tion over try­ing to get the local peo­ple to toe the line and, and adopt the fran­chise stan­dards. So that’s always a dif­fi­cult busi­ness mod­el. Um, just to, to high­light the dif­fer­ence in sizes. So total rev­enue, and I know it’s not an Apple’s to Apple’s com­par­i­son because Met­cash has hard­ware as well as super­mar­kets and Coles has Tar­get as well as super­mar­kets and Wool­worths has Kmart, et cetera.

[00:53:07] Tony: But total sales at a head­line com­par­i­son, Met­cash does about 32 bil­lion per year. Coles has AUDB and Wool­worths has AUDB. So that kind of size dis­par­i­ty will even­tu­al­ly make it dif­fi­cult if it has­n’t already for Met­cash to do good deals with sup­pli­ers. And I would­n’t be sur­prised, I, I’m not gonna sug­gest this, but I would­n’t be sur­prised if Met­cash can’t even access some sup­pli­ers because Coles and Wool­worths have some­how tied them up.

[00:53:35] Tony: Um, but I, I don’t have evi­dence for that, but would­n’t be sur­prised. Um, the stock doc­tor, finan­cial, finan­cial health of ear­ly warn­ing I think is an issue. Um, again, that could be just the, the way the mod­el works for this indus­try, but, um, cer­tain­ly when you look at all that Google on their bal­ance sheet and twen­ty-four cents per share of net tan­gi­ble assets, that’s say­ing to me they don’t have much space to bor­row for acqui­si­tions.

[00:53:59] Tony: They’ve just come out of a trad­ing halt today to raise 300 mil­lion for an acqui­si­tion. So I sus­pect if you’re a, a share­hold­er in this com­pa­ny, there’ll be, and they. Uh, grow­ing by acqui­si­tion, you’re gonna be asked to stump up mon­ey from time to time. So just take that into account if you, uh, want­i­ng to buy into this one.

[00:54:17] Tony: And the last risk I’ve put on my list was, is a gov­ern­ment inquiry, which has been announced into the super­mar­ket, um, indus­try, and whether there’s price goug­ing going on and whether they’re doing enough for the cost of liv­ing cri­sis, blah, blah, blah. And most reporters and most peo­ple are say­ing, oh, this is gonna be tough for Coles and Woolies.

[00:54:35] Tony: But I lived through one of these inquiries just before I fin­ished work­ing at Coles or Coles-Mey­er, um, back in the, when was that? Uh, ear­ly noughties or mid-noughties. And the per­son who, or the com­pa­ny that came out the worst from the inquiry was Met­cash because, you know, Coles and Woolies were able to, at least in the short term, make a case to say, we’ve dropped our prices, we’re doing the right thing.

[00:54:58] Tony: Um, I. But Met­cash just could­n’t afford to and they con­stant­ly kept point­ing. Every time they went in front of an inquiry pan­el, they point to the fact that they were cut­ting prices, but the oth­er play­er in the mar­ket was­n’t. And so, um, I don’t think Met­cash ever based any sort of gov­ern­ment sanc­tions or penal­ties, but cer­tain­ly got a fair bit of bad pub­lic­i­ty out of an inquiry like that.

[00:55:19] Tony: Um, they’re just not big enough to fire that, where­as Coles and Woolies are quite adroit at doing that. And uh, I sus­pect the same thing is a risk for Met­cash going through this one as well, which is about

[00:55:29] Tony: to start. So that’s

[00:55:31] Tony: Met­cash,

[00:55:44] Cameron: is it, is it, you know, a, a like­ly anti-QAV stock? Tony?

[00:55:50] Tony: No, because I think the NDQIV stocks are all growth stocks and Met­cash is in the growth stock.

[00:55:54] Cameron: It’s just

[00:55:56] Tony: This is mud­dling along.

[00:55:57] Cameron: much we

[00:56:00] Tony: May come on the by-list. I mean the prop-cap for it was sev­en point some­thing, 7.2 or some­thing. So it’s not too far off. Our

[00:56:07] Tony: cut-off. If like, if it can improve the qual­i­ty score it might get on

[00:56:10] Cameron: get up there.

[00:56:11] Tony: Yeah.

[00:56:12] Cameron: thanks TK. The only oth­er thing I’ve got on the talkie list is, uh, Alex’s. Ques­tion about FPR

[00:56:21] Tony: Yes.

[00:56:22] Cameron: on Face­book. In a Face­book group this morn­ing, Alex f asked about FPR. He said, FPR is back on the buy list, but it has a neg­a­tive oper­at­ing cash flow. How does that work? A few peo­ple point­ed out that it actu­al­ly does­n’t have a neg­a­tive, uh, cash flow.

[00:56:38] Tony: Hmm.

[00:56:39] Cameron: I’ve looked in stock, doc­tor, I don’t see a neg­a­tive cash flow. So, uh, not sure why Alex is see­ing that when we’re not. I’ve got, uh, oper­at­ing cash­flow 339.32 mil­lion for Sep­tem­ber 23, um,

[00:57:00] Tony: That’s what I’m, I’m see­ing as well. So the only, only pos­si­ble rea­son was that just to be care­ful that we use the peri­ods dis­played but­ton is annu­als and inter­ims and not annu­als only. So what Stop Doc­tor does is to take a rolling 12 months of, uh, of oper­at­ing cash flow. But I think even if we go to annu­als only, yeah, we’re still see­ing a pos­i­tive cash flow.

[00:57:25] Tony: So I’m not sure what’s going on there

[00:57:26] Tony: with, um, what Alex was see­ing. Per­haps the data’s changed.

[00:57:30] Cameron: Yeah, pos­si­bly or, but a lot of peo­ple were say­ing they could­n’t see it on the same, at the same time that he was say­ing he could see it. So not real­ly sure why he’s get­ting dif­fer­ent num­bers, but you’ve prob­a­bly worked it out by the time you lis­ten to this. Any­way, Alex, so that’s that. Uh, well that’s, that’s the show.

[00:57:52] Cameron: Tony. We’re back. We’re into after hours now.

[00:57:55] Tony: Good. Well, um, I’ll let you talk ’cause I’ve got noth­ing in, in after hours except to say that. Peo­ple may have noticed Alex Kaye has­n’t been ask­ing ques­tions because she’s just start­ed work at an art gallery in Fitzroy. This is her first day, so I’m keen to give her a call tonight and see how she went, but, uh, I don’t think she’ll be com­ing on the show for a while to ask ques­tions, unfor­tu­nate­ly.

[00:58:18] Tony: Uh, and she was up here last week. She came up for a few days, um, just to see us before she entered the work­force, and her life

[00:58:24] Tony: changed for­ev­er. But, um, that was love­ly. We hung out for a cou­ple of days, which was

[00:58:28] Cameron: Do you know what a job entails?

[00:58:31] Tony: It’s basi­cal­ly retail cus­tomer ser­vice, so it’s a, it’s a gallery in Fitzroy and, uh, they spe­cialise in prints and fram­ing. So she works in the store and. Talks to cus­tomers and takes their orders. Um, but we’ll have to do, learn how to do a lot of sell­ing of frames and, you know, guid­ing cus­tomers to pick­ing the right frames.

[00:58:52] Tony: And this, this store also has a fram­ing fac­to­ry out in Coburg or some­where north of Mel­bourne, and she may have to spend some time out there actu­al­ly build­ing frames as well dur­ing qui­et times. So, yeah. But she’s hap­py and excit­ed. The peo­ple who run the store, a cou­ple of ladies, I think they’re both XRMIT fine arts grad­u­ates as well, so she feels like she’s, she’s get­ting in the net­work, get­ting in the indus­try, and get­ting noticed.

[00:59:16] Tony: So it’s all good.

[00:59:17] Cameron: where­abouts in Fitzroy? Do you know?

[00:59:20] Tony: Uh, yeah. Brunswick Street, um,

[00:59:22] Cameron: What a great

[00:59:24] Tony: yeah, I’ve for­got­ten the name,

[00:59:25] Cameron: great part of Mel­bourne. To

[00:59:27] Tony: Yeah,

[00:59:28] Cameron: to work every

[00:59:28] Cameron: day. Yeah,

[00:59:30] Tony: Yeah. Well she’s just moved down the street on Moonee Pond, so unfor­tu­nate­ly she could have, you know, prob­a­bly moved clos­er

[00:59:37] Tony: to Fitzroy if she’d known. But any­way, that’s how it hap­pens.

[00:59:41] Cameron: Well, that’s great. Well, um, uh, we’ve been watch­ing Far­go, the new sea­son of Far­go Few episodes into that. It’s on SBS, so you got­ta put up with ads, but, uh, it’s, it’s real­ly good, you know, it’s, yeah, it’s real­ly good. John Ham is the bad guy in it. Juno Tem­ple from Ted. Las­so is sort of the pro­tag­o­nist in it.

[01:00:08] Tony: okay.

[01:00:09] Cameron: you watch Ted Las­so? Did you get into that?

[01:00:11] Tony: Oh, I loved it. Oh yeah,

[01:00:13] Cameron: You know, Juno Tem­ple? She’s like the

[01:00:15] Cameron: sort

[01:00:16] Tony: she’s a lit­tle

[01:00:16] Cameron: Scousy girl­friend of, uh, one of the foot­ball play­ers. Yeah. Do you know whose daugh­ter she is?

[01:00:22] Tony: With that cer­tain, I’m gonna say Julian.

[01:00:24] Cameron: She’s Julian. Tem­ple’s daugh­ter. Yeah.

[01:00:27] Tony: the film­mak­er for Nev­er. Mind The

[01:00:29] Cameron: Yeah. Like and God and every oth­er British

[01:00:35] Tony: Hmm.

[01:00:35] Cameron: punk band did video clips for I think like every­one from the Pis­tols ear­ly on through to, you know, Bowie and Cul­ture Club and you name it. He’s been involved. I know he was good friends with Lou Reed. He’s done stuff with both Iggy I think, you know, but uh, ’cause he got into that sort of clique.

[01:00:53] Cameron: But yeah.

[01:00:55] Tony: And most recent­ly Croc of gold

[01:00:57] Tony: for the

[01:00:58] Cameron: The Pogues. That’s right. Yeah. He did that as well. So yeah, she’s sort of British rock roy­al­ty, rock, uh, videog­ra­phy roy­al­ty. Any­way, but she’s great in this com­plete­ly. I only watched the first sea­son at Ted Las­so, and it was two sort of shma­mi for my tastes. But, um, she was great in it, and she’s com­plete­ly dif­fer­ent in this.

[01:01:19] Cameron: And, uh, ter­rif­ic. Real­ly, real­ly, she’s a, she’s a real­ly inter­est­ing actress, like, looks a bit weird, but she’s, uh, I, you know, she’s able to pull these char­ac­ters togeth­er. John Hamm is the bad guy as good. Like, I think it’s the best thing he’s done since Mad Men. She’s kind of, it’s not that far removed actu­al­ly from Don Drap­er.

[01:01:38] Cameron: It’s like Don Drap­er is a evil sher­iff, uh, basi­cal­ly 20 years old­er than an evil sher­iff. Um, it’s

[01:01:47] Tony: Did you see him in Dav­ey Dri­ver,

[01:01:48] Cameron: Oh yeah. I love Baby Dri­ver. Yeah, that was great.

[01:01:51] Tony: Yeah. Yeah.

[01:01:53] Cameron: I fin­ished read­ing Venus in Furs. Um, loved it. Twist­ed Dark and twist­ed. Um, but ter­rif­ic. Like, you know, kind of nev­er real­ly know what’s going on, uh, where it’s gonna end.

[01:02:10] Cameron: But, um, yeah, it was good. Lots of twists and uh, you know, I’m glad I read it. It’s one of the clas­sics that I final­ly got around to read­ing and glad I did. And speak­ing of clas­sics, I start­ed read­ing, but, you know, I was read­ing this book on a cou­ple of books on, uh, prob­a­bil­i­ty recent­ly and real­ized I, I, my, my foun­da­tion of.

[01:02:31] Cameron: Math­e­mat­ics was­n’t good enough. So I’ve gone back to Bertrand Rus­sell and Alfred North White­head and Prin­cip­ia Math­e­mat­i­ca this week. I’ve start­ed read­ing that with Chat­G­PT opened by my side. So lit­er­al­ly every para­graph I’m hav­ing to say, okay, explain this to me. Dumb this down so I can under­stand it.

[01:02:52] Cameron: But, uh, it’s good, you know, I’m sort of excit­ed to, uh, learn more about pure math­e­mat­ics and, you know, the­o­ry of math­e­mat­ics at that lev­el. It’s one of those things that I feel like I should under­stand bet­ter.

[01:03:10] Tony: I’ve always been a fan of Bertram Rus­sell, but

[01:03:13] Tony: I’m not sure I’ve come across his math­e­mat­ics. It’s always been his phi­los­o­phy that I’ve, I’ve

[01:03:17] Cameron: Yeah. Well that’s where he start­ed.

[01:03:19] Tony: PND and, um, and, you know, his, uh, phi­los­o­phy on, on, uh,

[01:03:24] Tony: athe­ism and all that kind of stuff. Yeah.

[01:03:26] Cameron: Yeah. Well, it, it actu­al­ly, I,

[01:03:28] Cameron: I. Par­tial­ly end­ed up going here because my moth­er sent me a quote of his about how he stopped believ­ing in free will when he was 15, and then he became an athe­ist at 18 and, uh, talked about why. And then, and I was sud­den­ly think­ing, I haven’t real­ly gone deep on Bertrand Rus­sel­l’s phi­los­o­phy.

[01:03:52] Cameron: So I did down­load a cou­ple of books on his phi­los­o­phy stuff, but then real­ized in read­ing about him that where he start­ed was the, the phi­los­o­phy of math­e­mat­ics and, uh, sym­bol­ic log­ic and that kind stuff. He was like the read­er of math­e­mat­ics at Cam­bridge in when he was 22 or some­thing. Um, like he was this math­e­mat­ics prodi­gy as a young man.

[01:04:19] Cameron: And

[01:04:19] Tony: Right,

[01:04:21] Cameron: and he said when he was 23, decid­ed he was gonna write. Two, like he, he is gonna have two streams of books that he was gonna write. One was gonna explain math­e­mat­ics and the oth­er was gonna explain phi­los­o­phy. And that’s, you know, that’s sort of what he ded­i­cat­ed his life to. And then when World War I Hap­pened and he was,

[01:04:43] Cameron: uh, on the anti-war camp, he kind of lost all of his uni­ver­si­ty posi­tions and was ostra­cized by the British elite and became the sort of, actu­al­ly it reminds me of Chom­sky a lot.

[01:05:00] Cameron: Uh, I mean, Chom­sky held onto his posi­tion, still has his posi­tion as far as I know, as the emer­i­tus chair­man of Lin­guis­tics at MIT. But, you know, he could have just had a qui­et career in lin­guis­tics. But was also a polit­i­cal activist and has run those two things con­cur­rent­ly for 60 years and cops a lot of shit for his polit­i­cal activism.

[01:05:26] Cameron: Um, but feels, uh, I remem­ber when I inter­viewed him years ago on the show, he just felt like he had a moral respon­si­bil­i­ty to try and do what was right rather than just liv­ing a cushy life. And I, you know, I, I, I won­der, I did­n’t ask him at the time, but I won­der in ret­ro­spect if it’s, um, he was inspired by Bertrand Rus­sel­l’s exam­ple.

[01:05:49] Cameron: Um, any­way, so I’m enjoy­ing that and I’ve been play­ing, Tay­lor gave me his PlaySta­tion when he went to LA and told me to play The Last of Us, which is like one of the most famous games of the last 10 years. It’s a sort of zom­bie apoc­a­lypse game. You’re a guy and you’ve got a. Get this girl across the coun­try to a lab­o­ra­to­ry where she’s immune to the zom­bie out­break and they wan­na fig­ure out why.

[01:06:18] Cameron: And

[01:06:18] Tony: Yeah, I saw there was a Net­flix series made out

[01:06:20] Cameron: there was, yeah. Um, so I’ve heard about this from the boys for years. Every­one I know who plays games is like, oh, this is the great­est game of all time. You’ve got­ta play this. So I’ve been play­ing that, um, here and there. When I get a bit of time, it’s, I think it’s okay. But I tell the thing that is incred­i­ble though, is the lit, like this PlaySta­tion uh, the PS five, like the tech­nol­o­gy in it.

[01:06:45] Cameron: Wow. Like, I remem­ber Pong Man, I, I start­ed, I had a pong con­sole when I was in like

[01:06:50] Tony: mm.

[01:06:51] Cameron: or some­thing on the Black-and-White tv. These things like the ray trac­ing that they do, the GPUs and these things, the qual­i­ty on the big screen TV of. You know, it’s just insane. And then of course, the Apple Vision Pro came out this week.

[01:07:07] Cameron: Have you been fol­low­ing any of that?

[01:07:11] Tony: I have not. No. And I, I did read some arti­cles about Apple and whether it was over val­ue giv­en its growth pro­file, but um, maybe the Apple Vision Pro’s going to

[01:07:22] Tony: change. Change the tra­jec­to­ry.

[01:07:26] Cameron: I think it, it, and I, I think every­one’s assum­ing that they’re gonna have a big AI play and that they will be one of the major ben­e­fi­cia­ries of AI once they put it on the iPhone. Um, if they don’t screw that up, they should make a lot of mon­ey out of that. But yeah, the, the reviews, Tay­lor was gonna buy a Vision Pro when, because he’s in LA as you know at the moment, but.

[01:07:51] Cameron: They’re like 5,000 bucks Ozzy, three and a half thou­sand us. He was gonna buy one, he’s decid­ed not to. I think he’s gonna wait till the next ver­sion comes out. I’ve been watch­ing a lot of the review videos and, and you know, read­ing Scoble and peo­ple like that who have got them. And the con­sen­sus seems to be, it’s amaz­ing tech­nol­o­gy, very heavy on your head after a while and your eyes are being used so much that you tend to get headaches and your eyes dry out from look­ing at them.

[01:08:24] Tony: So, so for the uh, peo­ple out there who don’t know what the Vision

[01:08:28] Tony: Pro is, can you tell us what the Vision Pro is?

[01:08:30] Cameron: Yeah, it’s Apple’s new gog­gles. It’s effec­tu­al­ly known as the apple ski gog­gles ’cause it just looks like a pair of ski gog­gles, high tech ski gog­gles. Um, but. You can basi­cal­ly have high res­o­lu­tion screens, as many screens as you want, you can just pop them up. So instead of look­ing at a mon­i­tor or two mon­i­tors as I have on my desk, you can have just scat­tered mon­i­tors every­where.

[01:08:53] Cameron: And you can have them posi­tioned three-six­ty. So there’s some videos of peo­ple, um, hav­ing screens set up in their home office, and they’ll have like five or six screens with dif­fer­ent things on them, like Face­Time and email and a brows­er and what­ev­er. But then they can stand up and walk into the kitchen.

[01:09:15] Cameron: And then in the kitchen they’ll have, they’ll be cook­ing some­thing and they’ll have timers above dif­fer­ent saucepans and what­ev­er, and they stay there. And a recipe up on the above the stove, you can just have it wher­ev­er you want. Then you walk back and all of your screens in your office is still where you left them.

[01:09:30] Cameron: It’s got spa­tial aware­ness and all that kind of stuff. But the inter­est­ing thing about it is you can also see. The real world out­side of your gog­gles, but you’re not actu­al­ly see­ing the real world. It’s got cam­eras that are video in the real world and feed­ing them back in, but they’re so good. Peo­ple are play­ing ping-pong and peo­ple hav­ing peo­ple throw them a ball and they can catch the ball.

[01:09:53] Cameron: So it’s like real time. It’s, it’s, uh, incred­i­bly, uh, respon­sive. And so they’re very, very expen­sive and they’re heavy and the bat­tery life is shared and all of that sort of first gen­er­a­tion stuff you’d expect. But the idea is that over time they will end up like Meta’s, Ray-Bans. You’ll have wear­able glass­es that just do over­lays of the world and they’ll have AI inte­grat­ed with them and they’ve got audio inte­grat­ed with them.

[01:10:21] Cameron: So peo­ple, there’s one guy demo­ing it, walk­ing down the street in Man­hat­tan, and he’s sit­ting in a sub­way sta­tion watch­ing a movie full high def with the audio in, just in his gog­gles and like a big screen TV video expe­ri­ence and the gog­gles and um, uh, so yeah, it’s kind of, uh, very, very cool tech that they’ve spent years devel­op­ing.

[01:10:48] Cameron: Tay­lor sent me, uh, their patent. Uh, appli­ca­tion for it, which I think was like 2006 or some­thing like that. So they’ve been work­ing on it. It was plugged into like a first gen­er­a­tion iPod, um, in this patent doc­u­men­ta­tion. So they’ve been work­ing on it for a very long time.

[01:11:07] Tony: Yeah.

[01:11:07] Cameron: Uh, yeah, so that’s cool.

[01:11:10] Tony: Good.

[01:11:14] Cameron: any­way, that is QAV for this week. Thank you. TK.

[01:11:20] Tony: Thank you Cam, and let’s have a call out for some more ques­tions

[01:11:23] Tony: for next week too, please,

[01:11:25] Cameron: Or not?

[01:11:27] Tony: Or not,

[01:11:28] Cameron: Or not, we’ll just talk about oth­er stuff.

[01:11:30] Tony: yeah. Yeah. I, I had, did have the thought a cou­ple of weeks ago. We should just take after hours and turn into a sep­a­rate pod­cast,

[01:11:38] Tony: just riff on cul­ture and enter­tain­ment and what­ev­er else is

[01:11:42] Cameron: I’m up for that.

[01:11:44] Tony: Yeah,

[01:11:45] Cameron: Uh. Yeah, yeah, yeah. I’m up for that. Sure. Be good. I like talk­ing to you about that kind of stuff. You can tell your your Union day sto­ries too. We should do the union

[01:11:57] Cameron: Tony Toe cut­ter, kind of the stu­dent union days. What was your play called? Curtin Falls.

[01:12:04] Tony: Curtin Fall Yeah.

[01:12:06] Cameron: fall. Ooh.

[01:12:07] Tony: Mm-Hmm.

[01:12:08] Cameron: Oh. I’m up for that.

[01:12:09] Cameron: I got noth­ing else to do.

[01:12:12] Cameron: All right, see ya.

[01:12:13] Tony: Okay,

[01:12:15] Tony: have quite a good week. Hap­py ASX.