QAV #707 — Three Men and a Tiger

QAV 707
[00:00:00] Tony: 1, 2.
[00:00:15] Tony: 3, go.
[00:00:18] Cameron: Wel­come back to QAV, episode 7 0 7.
[00:00:23] Cameron: The day before Valen­tine’s Day. Valen­tine’s Day. N minus one 13th of Feb­ru­ary. There you, I, I knew you would’ve. That’s why I was drop­ping it in there for
[00:00:34] Tony: We nev­er cel­e­brate it, but
[00:00:35] Tony: I should,
[00:00:36] Cameron: Nei­ther did we.
[00:00:40] Tony: Uh,
[00:00:40] Cameron: how are you this week? TK?
[00:00:42] Tony: very well. Thank you.
[00:00:44] Tony: It’s, uh, hot, hot, hot in Syd­ney today,
[00:00:46] Tony: but love­ly and
[00:00:48] Cameron: yeah. Hmm. Just grey and mug­gy and hot in
[00:00:52] Cameron: Bris­bane. What, uh, what’s been going on in the mar­ket for you this week? Tony?
[00:01:00] Tony: Oh, I’ve got a cou­ple of things. Um, it’s com­pa­ny report­ing sea­son, so at least from the, a cou­ple of stocks that I’ve looked at that are on the buy­er list, it seems to be going okay, espe­cial­ly in the retail sec­tor. My, it was only a week or two ago I was say­ing, oh, you know, my pre­dic­tion for this com­pa­ny report­ing sea­son is declin­ing prof­itabil­i­ty, but not for stocks like, uh, Nick Scali and Myer who both jumped on their prof­it results.
[00:01:28] Tony: ’cause I think most ana­lysts were expect­ing there to be some down­turn in retail stocks, giv­en the, the, the invert­ed com­merce cost of liv­ing cri­sis that every­one keeps talk­ing about. Uh, but no, they, they did well. Nick Scali jumped about 15% after its results came out. I think AGL, which is on our buy list, also did the same and Myer
[00:01:50] Tony: did the same.
[00:01:51] Tony: So, yeah. Inter­est­ing, inter­est­ing. Uh, prof­it sea­son and it always keeps us on our toes.
[00:01:58] Cameron: Myer jumped from six. Six­ty-six cents. up to sev­en­ty-eight cents, and then imme­di­ate­ly fell back down to sev­en­ty-one cents. But it is crept back up over the last week. It’s back up at like sev­en­ty-five cents now. So yeah. Uh, I was sur­prised when I saw that bump from Myer what’s going on and saw that their results came out.
[00:02:18] Cameron: Yeah, it is inter­est­ing, like there’s a lot like the, as we know, the, the all-orbs hit its all-time high some­time in the last week and then fell back a lit­tle bit, but it’s not by much. It’s still coast­ing along up near the top there. There’s a lot of froth and bub­ble going on, A lot of, a lot of it sort of, um, I don’t know, Pos­i­tiv­i­ty in the mar­ket, but it’s hard to real­ly under­stand why, and I’ve got some sto­ries a lit­tle bit lat­er on that we can drill into that.
[00:02:49] Cameron: What’s dri­ving that, blah, blah, what have you, what else have you got to talk about before we get into that?
[00:02:53] Tony: Well, I think the pos­i­tiv­i­ty in the
[00:02:55] Tony: mar­ket is around no more rate increas­es real­ly. And then the be is just how long it’s gonna take for rates to decrease,
[00:03:02] Tony: um,
[00:03:03] Cameron: You think there will be no, as the RBI said that, I thought they were
[00:03:06] Tony: no. That’s what ana­lysts are say­ing, but the gen­er­al con­sen­sus is no more rate increas­es, which is why the RBA, I think, came out and specif­i­cal­ly said, we’re not com­mit­ting to that.
[00:03:14] Tony: ’cause why would they, they need to keep their flex­i­bil­i­ty open. Um, it’s, it’s fun­ny, they kin­da like do a nego­ti­a­tion dance with the, with the jour­nal­ists and the ana­lysts and the, and the bond traders in par­tic­u­lar, the RBA will say one thing, the bond mar­ket will move a dif­fer­ent way, and then jour­nal­ists will
[00:03:30] Tony: ask the RBA ques­tions and they’ll, they’ll duck and dive.
[00:03:34] Tony: It’s, it’s a game that’s been going on for 40 or 50 years.
[00:03:38] Cameron: The five D’s of dodge­ball, duck dive, Dodge, duck and dive. Some­thing like that. You ever seen
[00:03:49] Cameron: dodge­ball? Yeah, it’s a great, I’ve got a clip any­way. Yeah.
[00:03:56] Tony: Yeah. So the oth­er thing that I’ve, uh, picked up a cou­ple of arti­cles on in the last week, which I guess, uh, res­onat­ed with me, uh, peo­ple com­ing out and just, just hav­ing a ques­tion about the, the role that pas­sive invest­ing and index funds and, and par­tic­u­lar­ly ETFs are play­ing in the mar­kets at the moment.
[00:04:18] Tony: And, um, Alan Kohler in his week­ly report came out and said, with an inter­est­ing stat, came out and said that, uh, the US now accounts for 70% of glob­al equi­ty mar­ket val­ue. So basi­cal­ly mar­ket cap, um, up from 45% in 2007 and 35% in 94, despite the US hav­ing only around 4.3% of the glob­al pop­u­la­tion and 17.8% of glob­al GDP.
[00:04:46] Tony: So just stop and think about that. For every dol­lar invest­ed world­wide, 70% is going into the us and of that 70%, I dun­no what the state is, but an awful lot is going into the Mag­nif­i­cent sev­en. And um, anoth­er arti­cle which he sort of expand­ed on that was by a guy called, uh, Ein­horn. I’ll just look up his, his first name does­n’t men­tion what his first name is.
[00:05:14] Tony: Sor­ry, David Ein­horn. Here we go. I’ve got the arti­cle in front of me. And, uh, he’s the founder and port­fo­lio man­ag­er of a com­pa­ny called Green­light Cap­i­tal in the state states. And he said recent­ly, this was report­ed in the AFR last week, he said the huge flows to pas­sive invest­ing, uh, the growth of algo­rith­mic trad­ing and momen­tum trad­ing.
[00:05:33] Tony: And the more recent rise in the US in par­tic­u­lar in trad­ing on very short-term options and sim­i­lar instru­ments means most investors are focused on price rather than val­ue. He goes on to say val­ue is not just a con­sid­er­a­tion for most invest­ment mon­ey that’s out there. Pas­sive investors have no opin­ion about val­ue.
[00:05:51] Tony: They’re going to assume every­body else does the work. And so what he’s basi­cal­ly say­ing is that, uh, there’s so much mon­ey fol­low­ing mon­ey if that makes sense. That if, if you are an index fund and you need to keep rebal­anc­ing because stocks are get­ting big­ger in the index, it’s quite pos­si­ble you end up with a sit­u­a­tion like we have at the moment in the states where all of the growth has come from the, from sev­en stocks, which are now huge­ly out­sized com­pared to the rest of the mar­ket.
[00:06:25] Tony: And, and the u as is the US is out­sized com­pared to the world. So it’s an inter­est­ing sit­u­a­tion. I I, I’ve long thought that these, the kind of rise of pas­sive invest­ing in index funds and index funds have been around for a long time, but there’s a lot more mon­ey in, um, index funds now since, uh, ETFs make them cheap and easy to trade.
[00:06:44] Tony: But yeah, it’s kind of a feed­back loop. If, if, um, if Apple goes up. That moves the index, then index funds have to buy Apple. So it’s a chick­en and egg sit­u­a­tion. Um, what, what’s dri­ving the price of Apple up? Is it the under­ly­ing val­ue or is it the, is it the momen­tum in, in the stock price of Apple and the index funds have to fol­low.
[00:07:03] Tony: And that’s what Ein­horn’s say­ing. And he goes on to say that, um, in the mar­ket, in a mar­ket that is push­ing high­er and high­er on the back of small groups of very large stocks, and where a stock like Nvidia can go par­a­bol­ic up more than three­fold in a year, despite the fact that it was already a very large com­pa­ny, Ein­horn’s warn­ing does car­ry extra punch.
[00:07:23] Tony: He’s say­ing that in his fund, uh, he’s moved away from val­ue to what he would call deep val­ue. In oth­er words, instead of pick­ing stocks with earn­ings of 10 and hop­ing they will re-rate. He is look­ing, or he, he and anoth­er guy called Green­light is look­ing for stocks trad­ing on four to five earn­ings. Um, but cru­cial­ly, Ein­horn is not buy­ing these stocks in the hope that the mar­ket will even­tu­al­ly recog­nise their val­ue.
[00:07:46] Tony: He wants stocks with strong cash flows and low lever­age that they’re able to buy their own stock or pay div­i­dends to effec­tive­ly guar­an­tee a return. Uh, sounds like what we do. Um, while Green­light’s lat­est investor leather shows, it has added a few names recent­ly on Dou­ble Dig­it Earn­ings, it tells the sto­ry of the strat­e­gy.
[00:08:06] Tony: The com­pa­ny’s three biggest win­ners in cal­en­dar. Year 2023 were Builder Green Brick Part­ners Ener­gy Group, Con­sol and IBM Spin­off Kin­dle all trade between five and sev­en times earn­ings and rose between 61% and 112% last year. So inter­est­ing take. Um, he’s, he’s going after even deep­er val­ue in the hope that if there’s lit­tle debt and lots of cash, that they’ll use that cash to buy their stock or pay div­i­dends or do some­thing else con­struc­tive and it’s worked for him.
[00:08:37] Tony: So, yeah. Inter­est­ing. Sort of take on the mar­kets and, uh, the head­line for that arti­cle on the AFR was Wall Street Leg­end Ein­horn Offers Fix for Bro­ken Mar­kets. And, uh, uh, it’s, you know, I hard­ly endorse those sen­ti­ments and it’s, to me, the crowd­ed trade in the mar­kets at the moment, apart from the Mag­nif­i­cent sev­en is index ETFs.
[00:08:58] Tony: And I just won­der where
[00:08:59] Tony: it’s gonna fin­ish. I don’t think it’ll end hap­pi­ly.
[00:09:03] Cameron: Hmm. Yeah. Well, in addi­tion to that, I saw anoth­er
[00:09:09] Cameron: arti­cle in the Finn this week. The cracks deep­ened beneath the mar­ket Sur­face. Investors are decid­ed­ly upbeat, but ana­lysts warn there are dis­turb­ing cur­rents beneath the US share mar­ket’s. Calm ser­vice. The US share mar­ket con­tin­ues to notch fresh records with the Blue Chip index, the S&P 500, break­ing through the 5,000 mark.
[00:09:31] Cameron: As investors con­tin­ue to cel­e­brate the cer­tain­ty that the US Fed­er­al Reserve will cut inter­est rates this year, what’s more investors are san­guine that the US share mar­ket will con­tin­ue to ral­ly. Regard­less of how the US econ­o­my per­forms. They fig­ure that if the US eco­nom­ic activ­i­ty were to fal­ter, the US Cen­tral Bank would come to the res­cue with even more aggres­sive rate cuts.
[00:09:54] Cameron: On the oth­er hand, if US eco­nom­ic activ­i­ty remains buoy­ant, cor­po­rate earn­ings will con­tin­ue to move high­er, which helps to jus­ti­fy ele­vat­ed val­u­a­tions. What could pos­si­bly go wrong, Tony? It’s just a win-win. If the econ­o­my does well, we mar­ket’s great. If the mar­ket ta, if the econ­o­my takes. Mar­ket’s great.
[00:10:15] Cameron: It’s all great. It’s just all good. Um, but it goes on to say, as the bear­ish soci­ety gen­er­al strate­gist, Albert Edwards has point­ed out, the U.S tech sec­tor is worth a third of the total U.S equi­ty mar­ket, which is high­er than the pre­vi­ous peak seen in July, 2000 at the height of the.com bub­ble. This he notes, is some­thing he thought he’d nev­er see again.
[00:10:39] Cameron: And I, I saw anoth­er chart from Bloomberg. I saw this in, uh, Red­dit on Wall Street bets of all places, which I still fol­low ’cause it’s hilar­i­ous. Uh, but it has a chart of the S&P 500, exclud­ing, exclud­ing, sor­ry, tech stocks. And it’s actu­al­ly, uh, at a his­toric low, if you take the tech stocks out of the S&P 500, it’s at a his­toric low.
[00:11:07] Cameron: So. All of the, of the growth in the S&P is com­ing to, uh, uh, tech stocks and Yeah, most­ly the Mag­nif­i­cent sev­en out­side of Tes­la, which I saw a fun­ny Tik­Tok sketch today of the rest of the Mag­nif­i­cent sev­en hav­ing like a, uh, inter­ven­tion, uh, meet­ing with Tes­la say­ing they were kick­ing Tes­la out­ta the Mag­nif­i­cent sev­en.
[00:11:31] Cameron: ’cause its share price has been plum­met­ing over the last year while theirs has all gone up. Uh, yeah. I mean, it’s one of these times when, you know, it, I, it reminds me of that peri­od in pre-COVID, when we start­ed the show where if you weren’t buy­ing tech stocks, you were, you know, or Bit­coin, you were a dum­my
[00:12:00] Tony: After­pay.
[00:12:00] Cameron: investor.
[00:12:01] Cameron: After­pay being the big one in Aus­tralia because it was just, you know, there was just boom times and every­thing was going crazy. And it kind of feels like that again with these tech stocks in the us. Just this bub­ble men­tal­i­ty of every­thing’s just gonna go great from here on in, and we don’t need to wor­ry about val­ue, we don’t need to wor­ry about prof­itabil­i­ty, we don’t need to wor­ry about, you know, fun­da­men­tals.
[00:12:28] Cameron: It’s just, uh, chase, chase the price, as you said ear­li­er, right?
[00:12:31] Tony: Well, it reminds you of pre covid. It reminds me of late nineties. These are exact­ly the kinds of con con­ver­sa­tions I was hav­ing in nine­ty-eight nine­ty-nine, um, you know, exact­ly the same sort of things. What do you mean? If you put.com after some­thing, it’s going to be worth a lot more than the day before when you put.com after it.
[00:12:53] Tony: And what do you mean that all of these oth­er, uh. Stocks on the
[00:12:57] Tony: S&P‑Five hun­dred are vir­tu­al­ly worth­less and unin­vestable. They’re still churn­ing out a lot more prof­it than dot-com stocks are. So what are you talk­ing about?
[00:13:06] Cameron: Well, the dif­fer­ence I, I guess with the Mag­nif­i­cent sev­en is these aren’t
[00:13:09] Cameron: star­tups. You know, um, Google Meta, Microsoft, apple, Nvidia, they’re, they’re not start­up com­pa­nies that have just put a.com after their name. These are busi­ness­es, in most cas­es that have been around decades,
[00:13:24] Tony: for sure.
[00:13:25] Cameron: have, have been very suc­cess­ful, have very well estab­lished prod­ucts and cus­tomers, and make a lot of mon­ey.
[00:13:31] Tony: until, until AI came along and AI is a start-up. Chat­g­pt is a start-up. That’s what’s put the rock­et under their share prices. Yeah, sure. They were, they were very strong, prof­itable com­pa­nies before that. And you know, Buf­fett among a. Said, Google’s a fan­tas­tic com­pa­ny ’cause it costs a cent to build an ad.
[00:13:52] Tony: You can sell it for a dol­lar. So it’s a, it’s a fan­tas­tic
[00:13:54] Tony: com­pa­ny. Um, but they’ve
[00:13:56] Tony: just had this, the accel­er­a­tor has been put flat to the met­al
[00:13:59] Tony: since AI
[00:14:00] Tony: came along. That’s the start­up.
[00:14:02] Cameron: mm And as we’ve talked about before, I mean, I, I get it. AI, I think is gonna be huge and some­body is gonna make a lot of mon­ey out of AI in the next 10 years. They all have a good chance at mak­ing some of that pie, uh, unless some­thing hap­pens that a black Swan comes along and, uh, you know, re-rev­o­lu­tion­izes the indus­try again.
[00:14:26] Tony: Well, you’ve made a good point. I mean, there are a lot of black swans in the world, and any one of them could upset the apple cart. And, and the his­to­ry of invest­ing is when some­thing’s priced to per­fec­tion. Does­n’t take, does­n’t take much of a, does­n’t even take a ful­ly grown black swan to come along and upset the apple cart.
[00:14:45] Tony: But the oth­er point I’ll make is, um, some­one will make a lot of mon­ey out of ai, but typ­i­cal­ly it’s the sec­ond per­son. So if you look back to the.com bub­ble, um, Nas­daq went down 80% in 2001, Ama­zon, for exam­ple, uh, went down to, you know, 14 bucks from 400 or what­ev­er it was. And then if you bought Ama­zon, you’ve made a lot of mon­ey, right?
[00:15:08] Tony: I guess you’ve still made a lot of mon­ey if you held on when you bought it at 400. But the per­son that made the most mon­ey bought it at 14. So when all these stocks inevitably blow up, because they’re all too expen­sive, it’s the per­son who buys it then.
[00:15:21] Tony: But a can pick the win­ner, and B, we’ll make a lot of mon­ey
[00:15:28] Cameron: Yeah, and I, I mean the, the com­pa­ny that’s dri­ving all of the AI boom is Ope­nAI, which isn’t part of the Mag­nif­i­cent sev­en. That’s not pub­licly list­ed yet. Uh, when that hap­pens, uh, it’ll be inter­est­ing to see how that share price does. That’s gonna be crazy.
[00:15:48] Tony: to the moon.
[00:15:50] Cameron: Microsoft­’s, uh, appre­ci­a­tion and
[00:15:53] Tony: Mm.
[00:15:53] Cameron: is to a large degree, I think, tied to its inter­est in Ope­nAI,
[00:16:02] Cameron: but we’ll see how that plays out over time,
[00:16:05] Tony: Any­way, we talk a lot about AI in this show, and it’s not an AI show. Yeah. The inter­est­ing thing is, is this, I think this sort of fly­wheel effect of these big com­pa­nies get big­ger and that makes the index funds buy more of them. Which makes the index funds to buy more of them. It’s, it’s, uh, it’s a self-per­pet­u­at­ing prophe­cy.
[00:16:21] Tony: And again, it’s gonna, when some­thing hap­pens to derail the val­u­a­tions on these com­pa­nies, what­ev­er it
[00:16:27] Tony: is, um, could be as sim­ple as one of the AI chat bots is far more suc­cess­ful than the oth­er ones. And the Mag­nif­i­cent sev­en becomes Mag­nif­i­cent one. You know, there’s a lot of mon­ey gonna, that’s gonna be lost because pas­sive investors are gonna just exit
[00:16:44] Tony: those com­pa­nies very quick­ly and exit the stock mar­ket prob­a­bly what did­n’t and nurse their
[00:16:48] Tony: loss­es.
[00:16:49] Cameron: mm Well, mov­ing on. Harold. Mitchell died today. Tony or yes­ter­day or some­thing. Do you have much to do with Harold? Big
[00:16:58] Tony: I did not meet Harold. Jen­ny actu­al­ly sat in the plane next to him
[00:17:01] Tony: once, and she report­ed to him as being a very nice guy.
[00:17:05] Cameron: He was­n’t, when I met him, uh, I. I had a cou­ple of run-ins with
[00:17:10] Cameron: him
[00:17:10] Cameron: I think it was in the ear­ly days of the pod­cast net­work. And, you know, when we were sort of shak­ing stuff up and talk­ing about media and media buy­ing and that kind of stuff, um, I think he expressed an inter­est and tak­ing an equi­ty stake in us.
[00:17:26] Cameron: At one point I had a cou­ple of meet­ings with him and like 20 years ago, and I, I don’t real­ly remem­ber much about it except that I walked away going, oh, he’s a big fat jerk. I was­n’t impressed. But that aside, um, built a very suc­cess­ful busi­ness and was real­ly an inno­va­tor in the sev­en­ties and eight­ies around media buy­ing in this
[00:17:48] Tony: Mm-Hmm.
[00:17:49] Cameron: And so, RIP, Harold, Mitchell, he lived large, uh, he was a big iden­ti­ty in Mel­bourne and
[00:17:56] Cameron: uh,
[00:17:57] Tony: And he famous­ly lost a lot of weight too along the way. Um, he did start off being large and then
[00:18:01] Tony: lost a lot of weight. Not that that’s impor­tant. Uh, wrote an inter­est­ing book about
[00:18:05] Tony: his life, which I remem­ber read­ing, I don’t know, 20 years ago.
[00:18:09] Tony: Um, and it,
[00:18:10] Cameron: Called Liv­ing Large.
[00:18:11] Tony: I’m not sure what it
[00:18:12] Tony: was called. It was,
[00:18:13] Cameron: name of his auto­bi­og­ra­phy. yeah.
[00:18:14] Cameron: Liv­ing Large. Yeah, it
[00:18:15] Cameron: was
[00:18:16] Tony: Um. But it’s again, this clas­sic sto­ry. He, he, he worked in an adver­tis­ing agency and did the media buy­ing. And if, I mean, you’ve had expe­ri­ence with adver­tis­ing agen­cies, they don’t, it’s not the most glam­orous job in the adver­tis­ing agency. It’s like the cre­atives go out to lunch, the cre­ative direc­tor comes back and says, uh, yeah, we should put this on Chan­nel nine.
[00:18:36] Tony: Call Harold get­ting to, you know, book some space for us. It’s like almost like the sec­re­tary of the cre­ative
[00:18:41] Tony: direc­tor. Uh, but Harold, uh, saw how impor­tant it was and how it was real­ly the engine room and how he can make mon­ey out of it and sep­a­rat­ed it from the agen­cies and, and, uh, became sort of the cen­ter of adver­tis­ing.
[00:18:53] Tony: Every­one had to deal with Harold to book their space. So it’s the clas­sic sto­ry of, um, you don’t want to go into a, a job which is real­ly pop­u­lar, where every­one wants to do it for noth­ing. You wan­na go into a job that no one wants to do and then lever­age it up and charge, charge lots of mon­ey for it.
[00:19:08] Tony: It’s, um. Clas­sic busi­ness trope I’ve seen before. Like waste man­age­ment or like, um, yeah. No one wants to shov­el shit for a liv­ing, but the shit shov­el­er can make a lot of mon­ey if they do it prop­er­ly and set up the busi­ness struc­ture. Right.
[00:19:21] Cameron: Par­tic­u­lar­ly if you’re mobbed up. Right. Isn’t that
[00:19:26] Tony: Yeah. But all those kinds of indus­tries, no one, no
[00:19:28] Tony: one wakes up think­ing I wan­na be a cement mix­er dri­ver. Right. But Boral’s a very suc­cess­ful busi­ness.
[00:19:33] Cameron: Yeah.
[00:19:34] Tony: Yeah.
[00:19:36] Cameron: Well, mov­ing on to oth­er things. The Wood­side San­tos
[00:19:39] Cameron: merg­er, which we’ve talked about a few times on the show over the last year or so, is dead, Tony. Dead val­ue killed the $80 bil­lion Wood­side San­tos deal accord­ing to Chan­ti­cleer in the finan­cial review. When two boards have gone as far as due dili­gence, they’re com­mit­ted to prop­er­ly explor­ing a deal.
[00:20:02] Cameron: What can kill it from there is val­ue. The great 4 3 2 1 dream deal is dead. The deal, which could have cre­at­ed a glob­al­ly rel­e­vant oil and gas play­er that would’ve been able to redi­rect cash flows across juris­dic­tions and make the most mon­ey pos­si­ble for share­hold­ers, failed at the most impor­tant hur­dle val­ue.
[00:20:23] Cameron: When they start­ed talk­ing prop­er­ly, Wood­side Ener­gy and San­tos knew rough­ly which shed of share­hold­ers would get, how much of the com­bined $80 bil­lion group. But then it goes on to say that, uh, they real­ly could­n’t agree on a deal, and, uh, the whole thing is just fall­en apart. What do you make of that?
[00:20:43] Cameron: What does it, what does it mean for. Uh, investors in WDES and STO, Tony.
[00:20:51] Tony: I don’t think it means any­thing in the short term. Um, we nev­er knew whether it was going to be a good deal ’cause they nev­er, no one ever told us what the deal was. They were still try­ing to work it out them­selves. Um, Wood­side, you know, in the, I think right­ly has a very dis­ci­plined approach to acqui­si­tion and part of that 4, 3, 2, 1 was they paid the right price for BHP’s Oil busi­ness and they, um, they bolt­ed that on a year or two ago and San­tos did­n’t do too bad out­ta buy­ing Oil Search, which is anoth­er part of that 4 3, 2, 1 con­sol­i­da­tion, which gave them a lot of expo­sure to PNG and poten­tial growth.
[00:21:28] Tony: Upside that’s always been San­tos issue is, um, they haven’t real­ly unlocked that to a large extent, but it’s still seen as being a, um, there on the table. So the San­tos share­hold­ers want­ed to be pay the pre­mi­um to Merge and the Wood­side share­hold­ers said, uh, we like you, but not at any price. And so it was prob­a­bly the right out­come.
[00:21:48] Tony: I expect there’ll be fur­ther cor­po­rate action from both of these com­pa­nies. So it’s a bit of watch this space now. Might not hap­pen quick­ly, may. Um, but as I said a cou­ple of weeks ago when I did a bit of a deep dive in this, um, in these two com­pa­nies, uh, there’s a lot of con­sol­i­da­tion going on in the world in oil and gas.
[00:22:08] Tony: Um, the big­ger com­pa­nies are get­ting big­ger. It’s a, it’s a bit of a sign of a declin­ing indus­try. Uh, and so they have to, you know, make, make prof­its from their back end of merg­ing with oth­er com­pa­nies and reduc­ing their costs as much from their front end of sell­ing more oil. And so, um, uh, you know, this, the com­bined Wood­side San­tos would’ve been, I think from mem­o­ry, the sixth largest oil and gas com­pa­ny in the world.
[00:22:32] Tony: Um, uncom­bined, it prob­a­bly means they’re gonna be the prey for some­one, um, to take, to lob an offer. Notwith­stand­ing they have to get around the for­eign own­er­ship. Deals. I think it, I think it’d be a tough sell to, to, um, to the Aus­tralian gov­ern­ment to give away con­trol of its oil and gas, uh, exports to an over­seas com­pa­ny, but, but no hur­dles, uh, insur­mount­able at the right price.
[00:22:55] Tony: So, um, what’s this space, I guess, and it does­n’t, and I think there could also be, it’s pos­si­ble that San­tos might be merged that’s also being talked about by ana­lysts that, uh, you know, take the oil out of San­tos or the gas out of San­tos, par­tic­u­lar­ly the gas. I think the gas might be worth more,
[00:23:11] Tony: um, if it’s sep­a­rat­ed from San­tos than if it stays with­in San­tos, so that that could hap­pen as well.
[00:23:17] Cameron: mm well.
[00:23:19] Cameron: both of their share prices tak­en a bit of a hit since this announce­ment hap­pened. Um, dun­no that Well, it’s, we’ve got what’s crude oil is what a Josephine for us at the moment,
[00:23:32] Tony: Yeah, it was a sell for a while, but it’s com­ing back a bit, I think.
[00:23:36] Cameron: let me just check. Com­Stats. Com­Sta­tus. Yeah. So crude oil is a cell and LNG is a Josephine. I hold WDS in one of the light port­fo­lios. I think I only bought it like a month or so ago. It’s up about 1% since then, but, so nei­ther of them are gonna be on our buy list at the moment any­way. So even though the share prices dropped, not much good to us because the oil and gas are not in a buy sit­u­a­tion. I dun­no how far away they are. I haven’t, I can’t remem­ber what the chart looked like yes­ter­day, but there might be some upside there at some point. Now
[00:24:22] Tony: Uh, yes. I mean, I think some peo­ple like you do in the light port­fo­lio may be hold­ing onto one or both, par­tic­u­lar­ly Wood­side. Um. Uh,
[00:24:31] Tony: yeah. I don’t think the fact that this merg­er has­n’t gone through as a sell, it’s, Uh, it might turn out to be a good thing in the end.
[00:24:37] Cameron: Yeah. Uh, I read this arti­cle on Stock­head this week. Dear ASX, I’m a lithi­um exec. Please find in close to my ghoulies. Um,
[00:24:49] Tony: That’s a very pro­sa­ic,
[00:24:51] Cameron: yeah, it’s a great, it’s a great, uh, this guy, he writes for Stock­head, the secret bro­ker. It’s, uh, it’s always an
[00:24:57] Cameron: amus­ing col­umn. I dun­no if you read it. Um, this one says, after thir­ty-five years of stock­broking for some of the biggest hous­es in investors in Aus­tralia and in the uk.
[00:25:06] Cameron: The secret bro­ker is Regal­ing Stock­head read­ers with his col­or­ful war sto­ries from the trad­ing floor to the deal­er’s desk. Nick­el Dimes and mines the old invest­ment ad Azure fol­low the mon­ey does­n’t always work, as Aus­tralian investors have dis­cov­ered with their lithi­um punts and to a less­er extent, their nick­el punts.
[00:25:25] Cameron: As I’ve point­ed out before, enlist­ed min­ers most excit­ing share­hold­er times are when they are explor­ing and not when they are pro­duc­ing. Excit­ing and promis­ing drill results Can put a fire under a com­pa­ny share price, but when, or even if they do become a pro­duc­er. The share price goes to a cur­rent val­u­a­tion price.
[00:25:45] Cameron: Should the com­mod­i­ty they pro­duce fall in price or their local cur­ren­cy go against them than they are as vul­ner­a­ble as a rab­bit star­ing at head­lights. Sure. Some­times hedg­ing strate­gies can help, but some­times they can bring you down. As the Lay­la broth­ers dis­cov­ered with their Sons of Gwalia hedg­ing dis­as­ter, they man­aged to turn a mas­sive gold pro­duc­er from Sons of Gwalia to Unix of Gwalia.
[00:26:09] Cameron: They were relat­ed to Peter Lay­la, who helped hook Vic­to­ria on the world’s gold min­ing map in the 1850s, so they must know what they’re doing right, wrong. Now we’re see­ing pun­ters in the head­lights watch­ing their invest­ments col­lapse in nick­el and lithi­um hope­fuls, as well as pro­duc­ers. They’ve been copy­ing it from all sides, and now the major­i­ty of the loy­al share­hold­ers are blam­ing the short­ers rather than the fun­da­men­tals for all the kicks they keep get­ting between their invest­ment.
[00:26:35] Cameron: Ghoulies.
[00:26:40] Tony: to com­mod­i­ty price graphs, isn’t it?
[00:26:43] Cameron: Yes. Yeah. Because you’ve demon­strat­ed over the years that not always, but quite often, the share price in a, uh, com­pa­ny that’s attached to a com­mod­i­ty will fol­low the com­mod­i­ty with a bit of lag
[00:26:59] Tony: Cor­rect. Yeah. Um, but I take issue with that. The, the state­ment about, uh, the fun time to be in the min­ing com­pa­nies is when they’re explor­ing and not when they’re pro­duc­ing. I think the fun times to be in it when they’re pro­duc­ing and you’re get­ting oper­at­ing cash­flow, that’s a great time to invest. I mean, I under­stand what he’s say­ing.
[00:27:16] Tony: It’s the spec­u­la­tive side of things is to, is to punt on pen­ny stocks when they’re explor­ing. And you could, you could have a huge win. Um, you could suf­fer a lot of loss­es along the way as well. Um, but yeah, but no, cer­tain­ly there’s, I mean, like, you know, as we’ve seen with gold stocks and with iron ore stocks and et cetera, et cetera, cop­per stocks, um, when a mine can, can sell. A com­mod­i­ty for a lot more than what it costs. They’re all in cost of pro­duc­ing that com­mod­i­ty use. They make mon­ey hand over fist.
[00:27:46] Tony: Any explo­ration plays a part in that. ’cause if they can expand the mine, um, into oth­er areas, then they make even more
[00:27:52] Tony: mon­ey. But, um, yeah, they’re great cash cows, I think pro­duc­ing mines.
[00:27:57] Cameron: mm Yeah. Par­tic­u­lar­ly if you can get them when they’re out of favor
[00:28:04] Tony: Hmm,
[00:28:04] Cameron: and, uh, the share price does­n’t reflect their val­ue. Right.
[00:28:08] Tony: Hmm, Absolute­ly. Yeah. And that’s, that’s often­times because either peo­ple are tak­ing a punt on what the com­mod­i­ty will do, or they just don’t like to be as the, as the, um, the per­son you quot­ed. They don’t want to be in the, the pro­duc­ing side of the mine life. They want to be in the explo­ration side of the mine life.
[00:28:26] Tony: But yeah, mines a, mine’s a won­der­ful cash cows. They real­ly are.
[00:28:33] Cameron: Uh, shout out to lis­ten to Peter Ball, who after last week’s show, when we men­tioned that the U.S mar­ket dipped because of McDon­ald’s and it had some­thing to do with the Mid­dle East, he sent me a link to this sto­ry in the Guardian. McDon­ald’s Records First Sales Miss in near­ly four years. Amid Boy­cotts com­pa­ny is among sev­er­al West­ern brands that have seen protests and boy­cott cam­paigns over per­ceived pro-Israeli stance.
[00:29:03] Cameron: McDon­ald’s report­ed its first quar­ter­ly sales miss in near­ly four years on Mon­day, squeezed by weak sales growth in its busi­ness divi­sion that includes the Mid­dle East, Chi­na, and India. The Burg­er Giant is among sev­er­al West­ern brands that have seen protests and boy­cott cam­paigns against them over their per­ceived pro-Israeli stance in the Israel-Amass con­flict.
[00:29:27] Cameron: Com­pa­ra­ble sales in McDon­ald’s inter­na­tion­al devel­op­ment Licensed Mar­kets seg­ment Rose 0.7 and a quar­ter wide­ly miss­ing esti­mates of a 5.5% growth. Accord­ing to LSEG data, the busi­ness account­ed for 10% of McDon­ald’s total rev­enue in 2023, the CEO flagged a mean­ing­ful busi­ness impact in McDon­ald’s Mid­dle East mar­ket in some areas out­side the region due to the war, as well as quote asso­ci­at­ed mis­in­for­ma­tion, end quote about the brand.
[00:29:56] Cameron: So there you go. That’s a real thing.
[00:29:59] Tony: Yeah. Wow.
[00:30:00] Cameron: boy­cotting McDon­ald’s can bring a mar­ket down
[00:30:04] Tony: Hmm. So, uh, I, I dun­no a thing about this, but, um, I don’t imag­ine McDon­ald’s came out and said, Hey, we’re pro-Israel and anti-Pales­tine.
[00:30:13] Tony: I guess it’s because they’re oper­at­ing in Israel
[00:30:15] Tony: per­haps that
[00:30:15] Tony: they, they’re seen as being
[00:30:17] Tony: pro-Israel. I, I don’t know.
[00:30:19] Cameron: I don’t know. I haven’t looked into it, uh, yet to see exact­ly. Oh, here we go. This is from Al Jazeera. The slump comes after cus­tomers in Mus­lim coun­tries called for a boy­cott of McDon­ald’s in response to its Israeli fran­chisee donat­ing thou­sands of free meals to the Israeli mil­i­tary. Fol­low­ing the announce­ment by McDon­ald’s Israel fran­chisees in Sau­di Ara­bia Oman Kuwait, the Unit­ed Arab Emi­rates, Jor­dan Egypt Bahrain, and Turkey dis­tanced them­selves from the dona­tions and col­lec­tive­ly pledged mil­lions of dol­lars in aid to Pales­tini­ans in Gaza.
[00:30:55] Cameron: So the go,
[00:30:58] Tony: Wow. The politi­ci­sa­tion of cap­i­tal­ism. Huh? Democ­ra­cy of cap­i­tal­ism.
[00:31:04] Tony: Inter­est­ing. I mean, it’s got got­ta be a thing. But I, when I read that arti­cle that you sent through from our lis­ten­er, I did also won­der whether Chi­na was play­ing a part in McDon­ald’s inter­na­tion­al sales drop because there’s, you know, all sorts of reports about Chi­na turn­ing down eco­nom­i­cal­ly and that
[00:31:20] Tony: that could affect, um, a
[00:31:21] Tony: busi­ness like McDon­ald’s over there.
[00:31:23] Tony: But again, I’m not famil­iar
[00:31:25] Tony: with this.
[00:31:26] Cameron: I, I thought the trope about McDon­ald’s was it’s what poor peo­ple eat. So if you have less mon­ey, don’t you eat more McDon­ald’s?
[00:31:33] Tony: that’s what it’s meant to be. Yeah. Yeah, it is. Yep. That’s, uh, they always put McDon­ald’s in the
[00:31:38] Tony: out­er sub­ur­ban areas, um,
[00:31:41] Cameron: hmm.
[00:31:41] Tony: more than the inner ones.
[00:31:46] Cameron: Stock tips are for Pat­sies. Stephen. Mabb sent us this
[00:31:49] Cameron: arti­cle, uh, yes­ter­day or the day before. Chris Leit­ner from Leit­ner and Com­pa­ny. I ana­lyzed 13,000 read­ers tips, review a cen­tu­ry of oth­er stud­ies and show how and why tips usu­al­ly under­per­form and some­times crash. Now, this arti­cle was way too long for me to actu­al­ly read.
[00:32:08] Cameron: Uh, so I put it in chat GPT and said, can you sum­ma­rize this for me? And it, it could­n’t even, it got bored. It got about half, got about halfway through, and it was like, Ugh, real­ly? Here’s what it
[00:32:21] Tony: Okay. You read that? What? Chachi. Bit­ti said. I read the
[00:32:23] Tony: arti­cle.
[00:32:25] Cameron: It said, uh, it blah, blah blah. Stud­ies to
[00:32:28] Cameron: demon­strate that tips often lead to under­per­for­mance and
[00:32:31] Cameron: some­times sig­nif­i­cant loss­es. It argues that stock tips can be entic­ing, but it gen­er­al­ly not backed by rig­or­ous analy­sis and rely­ing on them with­out doing one’s own research. As a mis­take, the piece empha­sizes the impor­tance of due dili­gence and warns against the allure of quick gains that stock tips promise.
[00:32:49] Cameron: I.
[00:32:50] Tony: Yeah, that’s a fair enough sum­ma­ry. But, um, there’s a few oth­er points that Chris Leit­ner was mak­ing. Um, apolo­gies if I don’t para­phrase these prop­er­ly, but, uh, he, he did analy­sis on the read­er tips for LiveWire. And so every year LiveWire asks both, uh, a whole pan­el of fund man­agers for their top tip for next year.
[00:33:12] Tony: And, and, uh, like­wise for the read­ers. And, and I know lots of thou­sands of peo­ple will give their tips for what it’s worth. Um, but Chris Leit­ner showed that, um, two things. One, that those stocks were. Ones that per­formed well before the tip was giv­en. And, um, he goes, uh, back to Keynes who said that the stock mar­ket is a beau­ty pageant and you’ve got­ta try and guess what oth­er peo­ple find as pret­ty.
[00:33:36] Tony: And so, um, he, he made a case that said that if, uh, that tips are often, um, late, that they, um, they, they fol­low what’s per­formed well in the past, which is kind of an easy way of tip­ping, I guess, if some­thing’s done well and you’re bank­ing on it going for­ward. The hot hand approach, I guess, as it’s called, um, you, you’ll do okay.
[00:33:54] Tony: Uh, and Leit­ner showed that if you bought and bought and held onto these stocks, you even­tu­al­ly under­per­form the mar­ket. I, I don’t dis­agree with that, but I think it’s a bit of a, um. Mis­rep­re­sen­ta­tion of what LiveWire do. ’cause they do this every year in Jan­u­ary. Um, I don’t think they meant they ever say buy and hold these stocks for­ev­er.
[00:34:13] Tony: They, they sug­gest, here are the ones for this year and then here are the ones for next year. And, and they do it on an annu­al basis, and then they tell you how they per­formed. And I think from mem­o­ry, I haven’t looked it up, but the LiveWire tips, both the, the, for read­ers and for fun­ders do okay. They’ve out­per­formed the mar­ket in a num­ber of years since live wise been going.
[00:34:31] Tony: So, um, take that, you know, with a grain of salt if you like. And, and the oth­er point I’ll make is that, um, the per­for­mance of a, of a list, of a tip list, like that is not just about the stocks that are being tipped, it’s about the weight­ing. You’ve giv­en each one. So if there’s. 10 top tips from read­ers or from Fundies and you equal weight, the pur­chase of those tips, you’ll get a dif­fer­ent result than if you just buy the top one or if you just buy the bot­tom one, or if you weight them by mar­ket cap or you weight more from top to bot­tom.
[00:35:08] Tony: So it’s impor­tant to know how, you know, the, the stocks are, are bought as well as, um, how they per­form. And I see that all the time when I do regres­sion test­ing. I can have a num­ber of stocks in the port­fo­lio and if I buy them dif­fer­ent ways, they one out­per­forms and one under­per­forms. So that’s, um, that’s always some­thing peo­ple need to keep in mind and that’s, that’s why, you know, we, we talk about, um, buy­ing from the top of the buy list down, um, as a, as a way of sort of pri­or­i­tiz­ing what to buy.
[00:35:38] Tony: So that’s, that’s the point. Um, and the last point I’ll make, uh, is I. And there’s a lot of quotes from War­ren Buf­fett in this arti­cle. The last point I’ll make is if War­ren Buf­fett was giv­ing me stock tips, tips, I I would def­i­nite­ly lis­ten. Um, but, but an impor­tant point, even in that con­text is that if, if War­ren was only asked for one stock tip, it, it’s only gonna be right six out­ta 10 times.
[00:36:03] Tony: So because War­ren says that in his, his com­mu­ni­ca­tions with share­hold­ers, he only ever gets six out of 10, right? So if you get one stock tip from War­ren and it does­n’t work out, you might go, ah, War­ren’s not good. I’ll go and talk to some­body else. And that’s, that’s anoth­er prob­lem too, is, is um, is mak­ing deci­sions about who to deal with based on one stock tip.
[00:36:26] Tony: So I, I think there was a lot of good stuff in this arti­cle, but, um, there’s a, opens up a lot of ques­tions and, and, uh, dis­cus­sion points as well. And I guess the last thing I want to talk about is it begs the ques­tion is, you know, why would you make QAV like tips. Um, ’cause we rec­om­mend stocks to, to buy for, for peo­ple.
[00:36:46] Tony: And if I can answer my own ques­tion, um, we also rec­om­mend we to sell them. Uh, the, the top tips from read­ers don’t come with an expiry date, so, um, you know, they might do well for the first month and not after that. As Leit­ner’s analy­sis shows, they cer­tain­ly go down­hill after about 12 months. Um, but also to QAV is the out­put of a process and we teach the process and, um, you don’t have to fol­low a tip.
[00:37:11] Tony: You can do your own analy­sis and, and work it out from scratch as well. Um, we trade along Qav light lis­ten­ers trade along with us, so that’s a, a bit of a dif­fer­ence to just tak­ing a tip. Um, and, uh, we pro­duce week­ly results and are quite trans­par­ent about our per­for­mance. So, um, all of those things I think are, are pre­req­ui­sites before tak­ing advice on what to buy and sell and.
[00:37:38] Tony: To be fair to us, we don’t tell peo­ple that buy and sell. We say, here’s some­thing to have a look at and
[00:37:42] Tony: do your own research.
[00:37:43] Tony: So that’s anoth­er impor­tant point. Here’s what we’re buy­ing and sell­ing. yeah.
[00:37:47] Cameron: yeah. yeah. And I, I think you, you made a lot of good points, like, but the whole sell­ing
[00:37:52] Cameron: thing, I think, you know, is some­thing that. Um, may not be obvi­ous to ama­teur investors. Uh, cer­tain­ly I, I, I did­n’t appre­ci­ate when we start­ed this show how impor­tant that is as a com­po­nent of a suc­cess­ful invest­ing strat­e­gy, know­ing when to exit and not just leav­ing it up to gut feel­ing, you know, oh, you know, I think I should sell. Like if, yeah, it’s real­ly tough if you’re just leav­ing it up to emo­tion, right?
[00:38:26] Tony: Oh, exact­ly.
[00:38:27] Cameron: rig­or­ous method­olog­i­cal method, let’s just go with that
[00:38:34] Cameron: sys­tem. Hav­ing some rig­or­ous math to know when to get out, um,
[00:38:42] Cameron: just makes a world of dif­fer­ence for me as an investor to just not have to get emo­tion­al­ly involved in the deci­sions, you know?
[00:38:51] Tony: Yeah. And look, and, and I’m not say­ing our, our exits are per­fect. Um, and there are oth­er ways to do it. And, uh, yeah, Steve and I had a chat yes­ter­day about, about, you know, process and tips and things like that. And, you know, he, he, uh, thinks that there are oth­er ways to exit stocks, which is fine. You know, when the, when the goes off the bio list or when it goes off his bio list or when the fun­da­men­tals change, they’re exit trig­gers as well.
[00:39:18] Tony: And I, I respect that, but, uh, because Steve’s
[00:39:21] Tony: got a frame­work that he’s work­ing around, I think that’s impor­tant.
[00:39:24] Cameron: hmm. As long as you have a frame­work that you’ve thought about, you have a process in place for help­ing you make your deci­sions, I think is the key thing. What, what that process is, is up to you
[00:39:36] Tony: Yeah, exact­ly.
[00:39:37] Cameron: with. Well, speak­ing of regres­sion test­ing, uh, I think I’ve talked about this briefly before, but, uh, one of our lis­ten­ers, Matt Walk­er, has been work­ing on a regres­sion test­ing sys­tem over the last cou­ple of months, and he sent it to me, the lat­est ver­sion of it, sent it to me last week.
[00:39:56] Cameron: I got it up and run­ning over the week­end, and it, and it, uh, bloody works. Um, there’s, there’s a, a bug that I found in it with the way it’s han­dling, um, cell deci­sions, which, uh, he’s imple­ment­ing at the moment, a fix for that. But I was able to do a regres­sion test on about eight years worth of fun­da­men­tal data in about 15, 16 min­utes.
[00:40:23] Cameron: I just set, I put in the vari­ables that I want­ed to test. I said, go, and 16 min­utes lat­er, it pro­duced a report for me that gave me the CAGA results. Over that peri­od, all of the buys and sells that had made along the way, um, to, to go back and check. Um, so, uh, first of all, huge con­grat­u­la­tions to Matt for build­ing this.
[00:40:48] Cameron: It’s, uh, real­ly impres­sive piece of code. It’s, it’s not some­thing that, uh, we, we can make pub­lic yet. It’ll be a while before we can do that once we get it work­ing. But hope­ful­ly, you know, at some point in the near future, we will be able to make this avail­able for peo­ple to do their own regres­sion test­ing or send me the things that, you know, the mod­els that you want me to regres­sion test and I can plug it in and, uh, you know, I’m gonna do things like, well I did one on the, on the week­end, which was, um, just prop calfers less than eight.
[00:41:20] Cameron: Ignore all the rest of our scor­ing. Just Prop­CAF, I still add the cell trig­gers in there, rule one and the three PTL cell trig­ger does­n’t do com­mod­i­ty cell
[00:41:30] Cameron: trig­gers yet, that we haven’t got to that, but just those two and just the Prop­CAF and ran that over eight years and it came back with like a, I think it was an 18% CAGA over that peri­od.
[00:41:43] Cameron: Um, again, some of the three PTL cell trig­gers aren’t exact­ly right. Um, but, so, you know, there, there might be some issues with that num­ber but uh, it was just amaz­ing to be able to plug in some, I know how much effort you’ve gone to with your interns over the last few years to do regres­sion test­ing. To be able to just plug in the vari­ables and say, go, and it just does it all for
[00:42:06] Cameron: you and spits out a result 15 min­utes lat­er is pret­ty excit­ing.
[00:42:10] Cameron: So again, shout out to Matt for all of the incred­i­ble work that he’s done and for shar­ing it with me, and let’s hope that, you know, that helps us improve QAV and test, uh, all these ideas that our smart lis­ten­ers have come up with and you come up with, you know, what, if we did this instead of that over 10, 15 years, what would that look like?
[00:42:33] Cameron: You know.
[00:42:33] Tony: Yeah. Thank, thank you, Matt. That’s fan­tas­tic. And I agree it. That’s what’s been miss­ing from my method­ol­o­gy to, to do that kind of grunt analy­sis in detail. ’cause I think the, the most impor­tant thing I think is to check the, you know, iso­late each vari­able and see how much it con­tributes and whether we need to reweight them in the QAV check­list or even elim­i­nate some, some of them from the QAV check­list and even add some, which, you know, we’ve had peo­ple talk about, uh, look­ing at com­pa­nies that can do buy­backs and things like that.
[00:43:01] Tony: So yeah, I think it’s gonna be great. And, uh, if, if we get it work­ing and you don’t hear from us any­more, we’ve
[00:43:09] Tony: sort of found some­thing, pro­duc­ing a real­ly good high CAGA num­ber and we
[00:43:12] Tony: we’re off doing it our­selves. Yeah.
[00:43:14] Cameron: Yeah, yeah, Yeah.
[00:43:17] Cameron: Uh, well the last thing I got to talk about is House­l­l’s Lit­tle ideas. For the week, three Men Make A Tiger was the one that I read this week. He says, peo­ple will believe any­thing. If enough peo­ple tell them it’s true. It comes from a Chi­nese proverb that if one per­son tells you there’s a tiger roam­ing around your neigh­bor­hood, you can assume they’re lying.
[00:43:37] Cameron: If two peo­ple tell you, you begin to won­der if three say it’s true. You con­vinced there’s a tiger in your neigh­bor­hood and you pan­ic. So
[00:43:46] Tony: that’s the basis of the Mur­doch press, isn’t it? If, if Chan­nel Nine tells you there are rov­ing gangs of, uh,
[00:43:54] Cameron: news.
[00:43:56] Tony: SI was gonna say, African youths, which is, which they did. And if, uh, the Dai­ly Tele­graph says it, and if the Couri­er
[00:44:02] Tony: male says it, peo­ple start to believe there’s a prob­lem with rov­ing gangs of African youth, even though there isn’t.
[00:44:09] Cameron: yeah, yeah, and, and I think it applies
[00:44:12] Cameron: to invest­ing as well. you know, you start to hear peo­ple talk about. After­pay or Bit­coin or the Mag­nif­i­cent sev­en or what­ev­er it is, you know, it’s, it’s some­thing, uh, in that, uh, there was this Per­sua­sion, was that the name of that
[00:44:31] Tony: Influ­ence? I was just think­ing that
[00:44:33] Cameron: Influ­ence? Yes.
[00:44:34] Tony: Cial­dini’s book Influ­ence.
[00:44:36] Cameron: Yeah. There is some­thing in,
[00:44:39] Cameron: uh, human psy­chol­o­gy where if you hear enough peo­ple say some­thing, repeat the same idea. It could be the zani­est, cra­zi­est, you know, least sup­port­ed by facts idea going, but if you hear it enough times, there’s some­thing in our brains that goes, oh, okay, I should take that seri­ous­ly.
[00:45:01] Cameron: If enough peo­ple are say­ing it to, to me it might must be true, even though it can be com­plete­ly not true.
[00:45:06] Tony: mm.
[00:45:07] Cameron: But, and it also gets back to sys­tem A and sys­tem B think­ing, you know, um, Daniel Par­na­mon,
[00:45:13] Tony: and Tver­sky.
[00:45:14] Tony: Yep.
[00:45:16] Cameron: Rather than hav­ing to think through things at a very deep lev­el, it’s quite often advan­ta­geous. It has been evo­lu­tion­ar­i­ly advan­ta­geous to have a heuris­tic that enables you to make snap deci­sions about
[00:45:36] Tony: Hmm.
[00:45:37] Cameron: And that seems to be like one of the heuris­tics. If three peo­ple tell you there’s a tiger roam­ing about, then it’s some­thing you should pay atten­tion to.
[00:45:44] Tony: Yeah. Like if,
[00:45:45] Cameron: if if you don’t, if you go, well, I’m gonna go and do my own research project, you might get eat­en by the tiger, right?
[00:45:52] Tony: Yeah. Well, Tver­sky and, and Kah­ne­man use the exam­ple of if you out on the veld and the grass starts to rus­tle and you can’t see what’s rustling in the grass
[00:46:00] Tony: you don’t go over and have a look.
[00:46:02] Cameron: Yes.
[00:46:03] Tony: it’s a tar­get and you run the oth­er way.
[00:46:05] Cameron: you, or you turn around with your spear at
[00:46:08] Cameron: the ready, uh, in case it is some­thing about
[00:46:10] Cameron: to jump on you and nine nine­ty-nine times out of a hun­dred it might be noth­ing. That one time out of a hun­dred, you’re right. It saves your life so evo­lu­tion­ar­i­ly, it’s a good sur­vival strat­e­gy, but when it comes to invest­ing, not such a good idea.
[00:46:27] Tony: No. Well, I mean, the, think­ing about that book, Afflu­ence Cial­di­ni uses social proof as one of his exam­ples of how we’re influ­enced by, by, um, our, our, our brains, which have evolved as, as you said. Uh, and he talks about the, the clas­sic psy­chol­o­gy exper­i­ment of some­one stand­ing out in the, look­ing up in the air.
[00:46:47] Tony: And yeah. And, and even­tu­al­ly peo­ple will walk past and have a look as, well, what the heck is this guy look­ing at? And when it becomes two or three peo­ple, then uh, the crowd starts to form what are these peo­ple look­ing at? And they all look up. So yeah, social proof is a, a big, uh, a big thing with our lives.
[00:47:03] Tony: And that gets used, um, in all sorts of ways. And one of the ways it gets used that again in the afflu­ence book, uh, in influ­ence book is, um, you know, when uh, when a movie wins an Acad­e­my Award, they reis­sue it and put out a poster with Acad­e­my Award win­ning, um, icons all over it. Because that’s the, you know, the proof that social proof that this is sup­posed to be good might be rub­bish, but, you know,
[00:47:27] Tony: it’s still, it’s still, you know, some kind of social proof, sim­i­lar sort of thing.
[00:47:31] Tony: It’s three peo­ple telling you this is a good movie.
[00:47:34] Cameron: hmm. Remem­ber when I was a kid, I used to say to
[00:47:36] Cameron: my dad, well, so-and-so
[00:47:38] Cameron: said It’s a good idea. He said, if so-and-so told you to jump off a bridge, would you? What? He, uh, prob­a­bly should have said, well, no. But if three peo­ple told me to jump off a bridge,
[00:47:48] Tony: Yeah. maybe the
[00:47:49] Cameron: I would prob­a­bly, I.
[00:47:50] Tony: Maybe there’s a tiger on the bridge.
[00:47:52] Cameron: Yeah. But I, I like, I think, and again, get­ting back to the ben­e­fits of hav­ing a sys­tem like QAV, or it does­n’t mat­ter, what­ev­er sys­tem that you’ve got it, one of the advan­tages is it helps you avoid the pres­sures of social proof, which is wired into us.
[00:48:10] Cameron: It’s very hard to fight that psy­cho­log­i­cal pres­sure to fol­low the herd,
[00:48:16] Tony: Yeah, that’s right to jump. And that’s, and that’s the oth­er point to make. If you don’t have a frame­work, it’s, um, you’re always gonna find that the mar­ket’s throw­ing up new sit­u­a­tions to you. And if you don’t have a frame­work to deal with it, you’re gonna stand there and pan­ic or look like a rab­bit. In the head­lights of a car
[00:48:32] Tony: or, or jump the wrong way, jump with the crowd.
[00:48:36] Tony: So that’s why a frame­work is impor­tant.
[00:48:38] Cameron: All right, Tony, you got­ta pull pork for us this
[00:48:40] Tony: I have, yes, this is a request. Inter­est­ing request. Um,
[00:48:44] Tony: by the
[00:48:44] Tony: way, com­pa­ny I was­n’t that famil­iar with, so, uh, I had to do a bit of research on this one. The com­pa­ny’s called
[00:48:49] Tony: Mon­ey Me
[00:48:51] Tony: MME.
[00:48:52] Cameron: This request, by the way, comes from Matt Walk­er,
[00:48:55] Tony: Ah,
[00:48:55] Cameron: built the
[00:48:56] Cameron: regres­sion test­ing sys­tem. So, and the oth­er ques­tions that we got are from his dad Toby. So it’s just the, it’s the Matt and Toby Walk­er show
[00:49:03] Tony: right. Good. Well, I think if they get that regres­sion mod­el, um, run­ning, I think we arm a few answers to ques­tions.
[00:49:12] Cameron: Yeah.
[00:49:13] Tony: Yeah. So MME Fin­Tech com­pa­ny, uh, deliv­er­ing loans dig­i­tal­ly to cus­tomers using a quick cred­it scor­ing sys­tem in a, in an app. And their prod­ucts include per­son­al loans, car loans, although they do do the car loans through bro­kers.
[00:49:31] Tony: Um, and they have a cred­it card called the Freestyle cred­it card, and they use a free cred­it score check­er, which is backed by Equifax, the cred­it score com­pa­ny that banks use as well. And I guess the whole, uh, process or the whole ben­e­fit of this com­pa­ny is that you can get access to mon­ey fast. So it’s not like.
[00:49:50] Tony: Going into a bank branch and wait­ing days where you fill out appli­ca­tion forms and hav­ing it assessed and all that kind of stuff. It’s, it’s, um, 24 7 and you can, you can get a quick, quick answer because the cred­it scor­ing is done there. And then, um, yeah, so they empha­sise fast ser­vice and quick access to funds.
[00:50:07] Tony: Found­ed in 2013, uh, they list­ed on the ASX in Decem­ber, 2019. At a dol­lar 25, ear­ly 2022 Mon­ey me acquired a com­peti­tor called Soci­ety one for 132 mil­lion. Soci­ety one was orig­i­nal­ly a peer to peer lender, uh, match­ing. Pri­vate lenders who were look­ing for yield with bor­row­ers who were search­ing for loans, and that was­n’t a bad idea.
[00:50:33] Tony: How­ev­er, they did have some issues with the reg­u­la­tors and, uh, had the piv­ot and change their busi­ness mod­el to be more like Mon­eyMe’s busi­ness mod­el of, um, lend­ing, uh, funds raised insti­tu­tion­al­ly, uh, to con­sumers. Uh, the deal includ­ed some MME shares as part of the pur­chase, which came out of escrow in ear­ly 2023.
[00:50:54] Tony: So there was some sell­ing back then. Uh, mid last year, MME under­took a cap­i­tal rais­ing at wait for it 8 cents a share to pre­dom­i­nant­ly pay down debt. So list­ed at a dol­lar twen­ty-five raised cap­i­tal last year at 8 cents a share, the founder, a guy called Clay­ton Howes, was dilut­ed from 18.3% down to 6.9%, and they raised, uh, the rais­ing raised thir­ty-sev­en mil­lion dol­lars.
[00:51:19] Tony: Um, and I guess, uh, at around that time when they brought, brought in some new share­hold­ers and also fol­low­ing inter­est rate ris­es, the com­pa­ny decid­ed to piv­ot to, uh, to prof­itabil­i­ty from growth. So the Decem­ber, uh, I’ve got Decem­ber, 2020, uh, 20 Decem­ber twen­ty-three half-year­ly result shows a prof­it of $6 mil­lion for the half with a reduc­tion in rev­enue to 105 mil­lion down from a hun­dred and twen­ty-one mil­lion, and an increase in cred­it, uh, wor­thi­ness or cred­it per­for­mance with loan loss­es reduced from 6% to 4.6%, half on half.
[00:51:57] Tony: And the loan book bal­ance is $1.2 bil­lion. So they’re, they’re basi­cal­ly. Say­ing they’re not gonna keep try­ing to grow the com­pa­ny as aggres­sive­ly as they were, and then they’re gonna try and make some mon­ey out of what they’ve already got, which isn’t a bad idea, I think. Um. A cou­ple of things that have hap­pened in the last few months, which, uh, piqued my inter­est.
[00:52:17] Tony: In Novem­ber, Decem­ber, the audi­tors were replaced, and in Decem­ber that the CFO resigned with no appar­ent suc­ces­sor. So both are poten­tial red flags on the sur­face. Uh, could­n’t, could­n’t see a qual­i­fied audit in, uh, the last annu­al report. So it may just be that the audi­tor turned over his busi­ness as usu­al, but it has been raised with us in the past that if we see a qual­i­fied audit and then the audi­tors are replaced, that could be a, uh, and then the QA goes away.
[00:52:46] Tony: That could be a sign that, um, there’s an issue some­where, uh, in the fig­ures still. But the new audi­tor isn’t as, um, isn’t, uh, as upset by that as the new, as the old one was. Um, the CFO res­ig­na­tion announce­ment said a search for replace­ment would begin imme­di­ate­ly. The CFO had been there for four years and is mov­ing on to oth­er things.
[00:53:07] Tony: Um. And it could just be a small com­pa­ny issue that they haven’t had a suc­ces­sor in the wings, um, or the CFO. But it does seem strange that both the audi­tors and the CFO are being replaced late Decem­ber in the com­pa­ny. So, um, poten­tial red flags I would raise. Uh, it’s, it’s hard to know with a small com­pa­ny like this ’cause some­times, you know, things just hap­pen.
[00:53:28] Tony: But, um, the two things which, uh, which are not a good look usu­al­ly, uh, get­ting into the num­bers, June 23 num­bers are still what’s in, um, stock doc­tor. And, and so I expect there to be new num­bers fair­ly soon in the stock doc­tor. And they don’t always reflect the num­bers that I just read out then, which, um, I pulled off.
[00:53:49] Tony: Uh. You know, off Google, um, on paper, but I don’t think they’re in stock doc­tor yet. So just, uh, you know, be aware of that when you’re doing your own analy­sis on the stock. And I guess be aware in gen­er­al­ly at this time of the year that, uh, we’re see­ing com­pa­ny reports come out and read­ing about them in the paper, but they don’t always get into stock doc­tor straight away.
[00:54:08] Tony: They can take cou­ple of days or a week. So just be aware of the num­bers you are using if you’re run­ning analy­sis at this stage. ADT is small. For this com­pa­ny, it’s $33,000, so it won’t suit, uh, peo­ple who have a large port­fo­lio. And I’m doing the analy­sis on the stock price of $0.09, so 8.70 cents and yes­ter­day or last night it closed at, uh, 8.10 cents.
[00:54:33] Tony: So it was going down as I was doing the analy­sis, um, e even so that that stock price is way under the con­sen­sus tar­get, which I thought was, um, inter­est­ing. Um, and. Maybe the ana­lysts know some­thing that, that we don’t. But, um, any­way, uh, going through the num­bers fur­ther, there’s no yield for this stock, so we can’t score it for that stock.
[00:54:56] Tony: Dr. finan­cial health and trend is strong on recov­er­ing, so we get, um, we like those com­pa­nies with recov­er­ing, so it gets an extra point for that. PE is 2.28, so very low PE, so it’s, and it’s the low­est, and I guess the only because, uh, up until this last half it has­n’t been prof­itable. Um, but I will score it for that.
[00:55:17] Tony: It’s a very low PE, and Prop­Cap is only 0.3, three times. So again, very, very low. Um, but this is a dig­i­tal bank, so Opcash can be dif­fer­ent to our nor­mal indus­tri­al, you know, cof­fee shop type com­pa­nies. Um, how­ev­er, there was, uh, cash was, uh, increased by $11 mil­lion in the, in the last year. So I think, um. The Opcash is pos­i­tive for this com­pa­ny and, um, it’s still a, it’s, even though it may be dif­fer­ent because we’re real­ly look­ing at the dif­fer­ence between rev­enues from cus­tomers being oper­at­ing cash flow and then what they’re pay­ing out to the peo­ple, their bond­hold­ers or you know, the fund, the peo­ple who’ve they bor­row mon­ey from to lend to con­sumers.
[00:56:01] Tony: That dif­fer­ence in the mar­gin is real­ly their oper­at­ing cash flow. It’s a bit of a dif­fer­ent cal­cu­la­tion, but it’s still rea­son­ably strong. IV‑I for this com­pa­ny is 20 cents IV-II is 19 cents and the price is 8.10 cents. So it’s well below IV‑I and IV-II, and we don’t see this very often, but two times share price is less than IV-II, which gives us anoth­er point.
[00:56:22] Tony: Net equi­ty per share is 21 uh, cents per share. How­ev­er, net tan­gi­ble assets is 9 cents per share, so fair. Bit of good will there. Even at 9 cents, we’re still able to buy this, uh, for less than book val­ue. And inter­est­ing­ly enough, it, it’s prob­a­bly what the, the mar­ket is focus­ing more on, giv­en the share price is 8.10 cents and NTA is 9 cents per share.
[00:56:45] Tony: Um, so, uh, we give you the score for that. earn­ings per share growth is minus 48%, so we give it a minus one, and I think that’s prob­a­bly what is going to be dri­ving the share price in the short term any­way. Uh, the fact that they, they expect prof­it to be low­er, uh, going for­ward. Direc­tors hold 19% and the own­er is still a, um, on the board and still owns a share.
[00:57:10] Tony: So we give it a tick for in the founder. Um. Three PTL sen­ti­ment is neg­a­tive, but it’s a bit hard to see because, oh, the red lay­er shows that it’s being very below its cell line, but it’s one of these stocks that went from a dol­lar 25 down to 8 cents. So, um, even look­ing at a three year graph, it’s still hard to to see, ’cause the, the last year or so is pret­ty flat.
[00:57:30] Tony: Even look­ing at the, the one year graph month­ly, um, I think it’s still below its cell line, uh, uh, ’cause it’s been going up and down. But, you know, the, you can draw a cell line on the one year graph and it’s still below its cell line. So sen­ti­men­t’s def­i­nite­ly against this and I would­n’t con­sid­er buy­ing it until it changes.
[00:57:47] Tony: Uh, the last thing to look at is con­sis­tent­ly increas­ing equi­ty, which it has. So all in all, the score, the com­pa­ny’s score for this is very good, which is why I think Matt Walk­er raised the, this is an issue or was one to look at. Qual­i­ty’s 14 out­ta 16, which is 88%, and Qiv’s score is 2.62, which is very, very high, but sen­ti­ment is neg­a­tive.
[00:58:08] Tony: So, uh, um. I, uh, I would­n’t buy this stock until sen­ti­ment returns. You don’t need to wait, I don’t think, for the five-year sen­ti­ment to return. In oth­er words, we don’t need to wait for the share price to go from 8 cents up to approach­ing a dol­lar twen­ty-five again. But, um, at least on the one-year graph, it needs to be a buy.
[00:58:28] Tony: Using our three-point trend line analy­sis poten­tial­ly on a longer time peri­od than that would be good. Um, cou­ple of oth­er things to note about this. Uh, if I can talk about, um, uh, I, I’ll call them strengths and weak­ness­es, but, um, it’s not real­ly a, uh, uh, that kind of analy­sis com­peti­tor. Plen­ty. Um. If peo­ple are inter­est­ed in these kinds of stocks, might be a bet­ter buy.
[00:58:52] Tony: Qav score is 0.14, but it’s, it’s, um, it’s not on the, uh, the buy list at the moment for neg­a­tive sen­ti­ment rea­sons. But if I look at the bread lat­er, it’s a very close to pos­i­tive sen­ti­ment. And, um, it’s below sell line, but the cur­rent month is an upturned month. And, and the bread lay­er won’t take that as L two, even though it’s a, a trough, it’s the sec­ond trough to redraw a new line.
[00:59:16] Tony: So, you know, by the end of the month, this could well be a buy of plen­ty with a QAV score of 0.14 and harm mon­ey. HMY has a QAV score of 0.2, but is still, um, again, below its byline, but it is increas­ing in price. So they, they might be two, uh, com­pa­nies to look at, um, unless, uh, but also Mon­eyMe could be, if it turns around its sen­ti­ment as well.
[00:59:43] Tony: The oth­er inter­est­ing thing to high­light is that Thorn Group, uh, par­tic­i­pat­ed in the rais­ing, or in fact, uh, some­body I think who has a stake in Thorn group did, and Thorn Group is appear­ing on the share reg­is­ter now as a, uh, is hav­ing a top 10 stake. Thorn Group was on our bio list a cou­ple of years ago, TGA, but it was Delist­ed and Thorn group was, um, active in this kind of area too, and in terms of pro­vid­ing, um, uh, loans to cus­tomers.
[01:00:08] Tony: And it’s, it came out of the old radio rentals busi­ness that, um, leased tele­vi­sions and wash­ing machines and things to peo­ple. So. Don’t dun­no if that means any­thing. If, if, uh, it could mean that the per­son who invest­ed in Thorn group also thinks Mon­eyMe is worth invest­ing in. Or it could lead to some oth­er kind of cor­po­rate activ­i­ty.
[01:00:26] Tony: I don’t know. Um, but it’s, but it’s,
[01:00:29] Tony: um, yeah, it’s some­one who knows the space who’s a now a cor­ner­stone investor in the com­pa­ny. So that’s Mon­eyMe.
[01:00:35] Cameron: Tony. Did you work out,
[01:00:36] Cameron: uh, why the share prices col­lapsed
[01:00:39] Cameron: from $2 20 all the way down to 8 cents?
[01:00:43] Tony: Oh, I think it’s got­ta be, I think it’s got­ta be debt and cap­i­tal rais­ings would be my
[01:00:47] Tony: guess.
[01:00:49] Cameron: dilu­tion with the cap­i­tal
[01:00:50] Tony: yeah, dilu­tion was in there as well. Um, I. Yeah, and we’ve seen this before any num­ber of times, is that if the cur­rent cap­i­tal rais­ing isn’t enough, then they kin­da raise mon­ey at 8 cents a share or dilut­ed and, um, less than 8 cents a share, which dilutes things even fur­ther.
[01:01:07] Tony: So some­times he’s, uh, a small cap com­pa­ny can get caught in this dilu­tion spi­ral and nev­er recov­er. ’cause there’s mil­lions and mil­lions and mil­lions of shares on issue at, at pen­nies in the
[01:01:17] Tony: dol­lar.
[01:01:18] Cameron: hmm,
[01:01:21] Tony: Not say­ing that will hap­pen with mon­ey me ’cause the QAV score is very good for it. But, um, I think the ques­tion I ask myself is what’s dri­ving the share price down if the QAV score is so good? And I think two things. I think maybe the oper­at­ing cash flow is, is boost­ing the QAV score. ’cause it’s not a typ­i­cal indus­tri­al com­pa­ny.
[01:01:39] Tony: Um, although oper­at­ing cash flow does look good and it is adding cash to the bot­tom line. Uh, but I think it’s this, um, earn­ings fore­cast of neg­a­tive, what, what was it? 48%, which I think could be dri­ving the share
[01:01:51] Tony: price there.
[01:01:54] Cameron: I had a look at their prospec­tus from when they launched back in, what’d you say? It was like 2019 iPod
[01:02:03] Cameron: and the chair­man, uh, Mr. Code. Peter code
[01:02:09] Cameron: was real­ly push­ing their growth rates
[01:02:13] Tony: Right? Yeah.
[01:02:15] Cameron: Yeah.
[01:02:16] Cameron: Mon­eyMe has a founder-LED man­age­ment team that has deliv­ered a strong track record of rev­enue growth
[01:02:22] Cameron: increas­ing at a com­pound annu­al growth rate of forty-two per­cent from FY-SEVENTEEN to FY-NINETEEN.
[01:02:29] Cameron: The board and exec­u­tive team believe the com­pa­ny’s growth pro­file is attrac­tive and will be under­pinned by fur­ther pen­e­trat­ing the con­sumer lend­ing sec­tor, con­tin­u­ing to inno­vate our prod­uct offer­ing and cap­i­tal­iz­ing on new rev­enue oppor­tu­ni­ties. It’s inter­est­ing then that you said they’re not focus­ing on growth, they’re focus­ing on prof­itabil­i­ty
[01:02:48] Tony: Yeah. And that’s, that’s real­ly a key for any com­pa­ny that that focus­es on growth is what hap­pens when the growth stops. Um, and the com­pa­ny’s now prof­itable, so I can’t fault it for that. And it’s got $1.2 bil­lion in the loan book. So it’s actu­al­ly rea­son­ably good that’s had a rea­son­ably suc­cess­ful, um, career, but now the gross out of the busi­ness that’s.
[01:03:08] Tony: Giv­ing it a dif­fer­ent pro­file. And uh, you know, I’m think­ing about com­pa­nies like Zero, which have had a big, um, stock, uh, price reduc­tion, um, as they kind of grap­ple with how do we come off growth and, and return and go to prof­itabil­i­ty. Um, and that’s always the case. And that’s, and it’s always the case.
[01:03:27] Tony: Growth stocks have to go ex-growth at some stage. They can’t oth­er­wise they take over the world and it’s, it’s just not gonna hap­pen unless it, it’s a mag­nif­i­cent sev­en in the us which is now attract­ing so much mon­ey. It’s crazy. But, but yeah. Um, that’s always the prob­lem with growth stocks. And, and look it, if it’s as suc­cess­ful, prof­itable com­pa­ny, I think it will have stay again in the sun.
[01:03:47] Tony: ’cause it, it seems to be doing well on a lot of met­rics. Um, the oth­er thing I would say is, uh, around the time it list­ed, uh, or the time it was found­ed, there were. Half a dozen of these kinds of com­pa­nies found­ed at the same time, or brought to mar­ket at the same time, includ­ing ones that have been gob­bled up by, I think NAB bought, um, one of these, um, uh, Neobanks and I think one went broke.
[01:04:12] Tony: And I think, uh, what was the oth­er one I was think­ing of? Um, oh, Lat­i­tude, the old GE mon­ey I think bought one as well. Um, and Lat­i­tude oper­ates in this space as well. It pro­vides the, the loans to buy your Frigate, Har­vey Nor­man and pay no inter­est for five years, that kind of stuff. So it’s a, it’s a con­test­ed mar­ket­place.
[01:04:32] Tony: Um, and, you know, poten­tial­ly we saw Soci­ety one acquired by this com­pa­ny and poten­tial­ly
[01:04:38] Tony: there’ll be more con­sol­i­da­tion in the field as well. So that’s some­thing that peo­ple have to be aware of.
[01:04:44] Cameron: mm Good stuff. Thank you, Tony. And thank you Matt for the request. Mov­ing on from Mat­t’s. Ques­tion to Mat­t’s dad’s. Uh, well, not a ques­tion. Well, it was a ques­tion when the buy list came out yes­ter­day. Uh, Toby uh, asked me to dou­ble. NWS News Corp, which was on the list, uh, fair­ly high up on the list. And I looked into it and it had­n’t been on pre­vi­ous lists, and I start­ed look­ing at the mas­ter sheet and try­ing to work it out.
[01:05:19] Cameron: What I end­ed up doing was com­par­ing the, um, stock doc­tor data for NWS from this week’s down­load to the pre­vi­ous week’s down­load, and noticed that stock doc­tors had the shares out­stand­ing drop from 578 mil­lion down to 28 mil­lion, uh, shares out­stand­ing, which thought, wow, real­ly? Maybe Rupert’s doing a big
[01:05:47] Cameron: buy­back.
[01:05:48] Tony: I got­ta say Stock­Doc­tor did this last half as well. ’cause I got sucked into buy­ing news Corp until I real­ized that the, that the data was wrong. And they actu­al­ly changed it about a week lat­er. So they, they’ve fall­en for the same trap again, but lis­ten­ers should­n’t. Um, the, the, if you go into Stock­Doc­tor and have a look, the, I think the pri­or num­ber of shares and the pri­or half
[01:06:10] Tony: is the cor­rect one.
[01:06:10] Tony: That’s about 570,000, not 29,000 or what­ev­er the
[01:06:15] Tony: num­ber is now.
[01:06:18] Cameron: Well, I looked at Stock­o­pe­dia and I looked at Yahoo Finance. They were all up around the
[01:06:23] Cameron: 578 mil­lion. And then I went to,
[01:06:26] Tony: thou­sand. Yeah.
[01:06:27] Cameron: yeah, well, yes, it’s in Mill, it’s in thou­sands in Stock­Doc­tor, isn’t it? 578,000 thou­sand. I went and pulled up News Cor­p’s most recent report and looked at that
[01:06:37] Tony: did too.
[01:06:38] Cameron: got the same num­ber.
[01:06:40] Tony: Yeah. Pulled out
[01:06:40] Cameron: So where,
[01:06:41] Tony: there. Is it 4
[01:06:42] Cameron: yeah, so where, where’s
[01:06:43] Cameron: Stock­Doc­tor get­ting the 28
[01:06:44] Tony: And they’ve done it
[01:06:45] Tony: twice now.
[01:06:46] Tony: Yeah, the form
[01:06:47] Cameron: I emailed. Yes, I emailed Vic­tor Pasquale, the, uh, data research guy at, uh, Lin­coln Indi­ca­tors and asked him to look into it. He has­n’t replied to me yet. I sent him an email last night on that. So just, uh, be care­ful of that mem­bers when you’re look­ing at your bios.
[01:07:07] Cameron: Good, good Spot­ting Toby. Um, anoth­er issue I’ve had with Stock Doc­tor recent­ly too, I’ve had a few new mem­bers. You know, when peo­ple sign up to QAV stock doc­tor gives them the QAV fil­ters, Um, well, some­thing’s hap­pened at Stock Doc­tor, and the fil­ters are in the wrong order. This has hap­pened on and off over the last 18 months, and always the same thing hap­pens.
[01:07:35] Cameron: The new mem­ber. Signs up, they get the fil­ters, they, they’re going through the Bible, they down­load the report, they put it into the check­list, and it does­n’t work. They have all these errors. They then spend hours try­ing to fig­ure out why it’s wrong. They can’t fig­ure it out. They email me. I spend an hour try­ing to fig­ure out what’s going wrong and can’t fig­ure it out, and then even­tu­al­ly I go, hold on a sec­ond, and I go and check the fil­ters and notice that the fil­ters are in the wrong.
[01:08:04] Cameron: Order. Uh, so I’ve emailed Stock Doc­tor again about that. Again, they haven’t got back to me. Uh, well, Robert Man­fre, who’s the head of the user inter­face, peo­ple said he’d get his team to look into it yes­ter­day, but I haven’t any­thing back. But this has been an ongo­ing thing with Stock Doc­tor over the last cou­ple of years.
[01:08:21] Cameron: I dun­no what hap­pens on their end to bug­ger it up, but, um, it seems to bug­ger it up. So if you are a new QAV mem­ber and you’ve, you’re, you know, you’ve down­loaded your, your fil­ters from stock doc­tor and it’s not work­ing, uh, email me. But look at that. Look at the order that the fil­ters are sup­posed to be in, in the Bible.
[01:08:44] Cameron: Com­pare them to the order that your fil­ters are in because the spread­sheet is built for a cer­tain order of data, right?
[01:08:51] Tony: Yeah.
[01:08:51] Cameron: You, you cut and paste it into the. Check­list and it expects cer­tain data to be cer­tain columns. You can eas­i­ly move them around and stock doc­tor and fix it your­self, but you know, it’s only gonna take you a cou­ple of min­utes to fix it.
[01:09:04] Cameron: But it’s the fig­ur­ing out what’s bro­ken, which is the biggest pain in the ass. So I apol­o­gize to the peo­ple that’s hap­pened to recent­ly. Um, the oth­er one from Toby was talk­ing about WAF, west
[01:09:20] Tony: Ah,
[01:09:22] Cameron: Resources. Is that what WAF is?
[01:09:24] Tony: is West African. Yep. Resources, a min­ing com­pa­ny, gold
[01:09:27] Tony: min­er
[01:09:28] Cameron: he says, WAF’s fore­cast earn­ings after expens­es for the com­ing year
[01:09:32] Cameron: of 200,000
[01:09:35] Cameron: ounces
[01:09:37] Tony: dol­lars.
[01:09:38] Cameron: USD equals 140 mil­lion. Ver­sus mind-cap­tion works. Expens­es of 270 mil­lion is a bit of an eye-open­er and poten­tial debt-neg­a­tive. Inter­est­ed in yours and Tony’s feel­ing on the com­pa­ny at the moment? Toby?
[01:09:57] Tony: Yeah, so my, my feel­ings on West African resources is summed up by the sen­ti­ment, um, which is going down. Uh, so even though it’s on the buy list, it’s got a QAV score of 0.15. The sen­ti­men­t’s not great. It’s a Josephine. And, uh, I think gold just recent­ly became a Josephine as well. So the, the gold, the gold mar­ket’s turned down a lit­tle bit.
[01:10:20] Tony: Um, but again, this might be a stock doc­tor issue as well in terms of why it’s on the buy list. Because if you look at the front page of stock doc­tor, it says the, uh, fore­cast earn­ings per share growth is neg­a­tive 38%. Then if you go into the down­load, it’s say­ing it’s up 7%. So there’s a dis­con­nect there between those two pieces of data.
[01:10:44] Tony: And it could be just again, that um, uh, yeah, our down­load is still show­ing results from 30th of June. I. 2023. We don’t have the lat­est half-year results in. I’m not sure if they’re out yet, but per­haps the, um, the front page of Stock Doc­tor has been updat­ed, um, with more recent data and the down­load has­n’t, but it be, it as it may.
[01:11:07] Tony: Um, in terms of our scor­ing, it would only take us one, one point off the score, a neg­a­tive. It would turn the, um, fore­cast earn­ings per share to a neg­a­tive one. Uh, so it’s def­i­nite­ly sen­ti­ment, which is, which is, um, down­grad­ed. But neg­a­tive thir­ty-eight per­cent makes sense to me giv­en, um, what Toby said that, uh, you know, they’re fore­cast­ing earn­ings after expens­es of 140 mil­lion, but they’re doing works of 270 mil­lion.
[01:11:31] Tony: So that does seem to be a neg­a­tive. Um, I haven’t done a deep dive into WAF’s bal­ance sheet, but if it’s been doing things, um. Prop­er­ly, it should have had depre­ci­a­tion and amor­tized or depre­ci­a­tion cap­i­tal set aside to do this. Uh, this works, um, if it’s, if it’s for, for mines that, that already exist, but I’m not sure, um, what’s on the bal­ance sheet or whether they’ll have to, uh, get some more debt or even, uh, do a cap­i­tal raise to fund the short­fall.
[01:12:04] Tony: Um, hope­ful­ly it’s in the bal­ance sheet. They can fund it, um, through nor­mal depre­ci­a­tion, uh, or cash reserves. Um,
[01:12:12] Tony: but that’s worth check­ing. But yeah, I, I, I did­n’t go any fur­ther because the neg­a­tive sen­ti­ment just stopped me in its
[01:12:17] Tony: tracks.
[01:12:20] Cameron: Yeah. And, and as Tony point­ed out, gold did become a Josephine this week, the under­ly­ing com­mod­i­ty. And I think Alex, uh, Franklin post­ed in Face­book that he’d bought WGX and the share price had just
[01:12:35] Tony: Oh.
[01:12:36] Cameron: And I said, yeah, well it gold just became a Josephine, so that’s why it’s not you. It’s gold. Um, all of the gold stocks took a bit of a hit this week.
[01:12:46] Cameron: So yeah, as we said, under­ly­ing com­modi­ties.
[01:12:50] Tony: Yeah, it’s impor­tant.
[01:12:54] Cameron: Hmm. Alright, well that is the main part of the show for this week, Tony. We’re into after hours, the show that you wan­na split off and have a sep­a­rate show
[01:13:03] Tony: Yeah.
[01:13:05] Cameron: after Hours with TK and Cam.
[01:13:09] Tony: Reminds me straight away of that, uh, what was that movie Jim Jam­mush did Down by Law
[01:13:14] Tony: where
[01:13:15] Cameron: Great
[01:13:15] Tony: that was one of my favorites. Where Tom Waits is the after hours DJ.
[01:13:19] Tony: It’s, uh, good evening and wel­come to After Hours with, uh, Tom Waits.
[01:13:28] Cameron: Jim Jar­musch. Seri­ous­ly,
[01:13:29] Cameron: one of my
[01:13:29] Cameron: favourite direc­tors, one of the best, best Amer­i­can direc­tors in the
[01:13:32] Cameron: last, you know, 30 years.
[01:13:34] Cameron: Great films. What have you been doing, Tony? What have you been into this week?
[01:13:39] Tony: I start­ed read­ing the Wal­ter Isaac­son biog­ra­phy of Elon Musk based on your
[01:13:46] Tony: dis­cus­sion of it pre­vi­ous­ly.
[01:13:48] Tony: Yeah, it’s amaz­ing. Well, I haven’t got­ten very far into it, but just his upbring­ing is incred­i­ble.
[01:13:54] Tony: It’s like Lord of the
[01:13:54] Tony: Flies. Yeah,
[01:13:56] Cameron: Yeah,
[01:13:56] Cameron: Real­ly is. It’s an insane sto­ry.
[01:13:59] Tony: yeah. Talk­ing about the ben­e­fits of being punched in the face a lot at school and tak­en out to, to camps where some kid died in the past and the teach­ers would just say, look, don’t be a
[01:14:09] Tony: fool And, do that like that kid did,
[01:14:12] Tony: but just let them go out and live, you know, fend for
[01:14:15] Tony: them­selves.
[01:14:18] Cameron: Yeah. And, and if you accept that Elon’s on the spec­trum some­where, you, you take a kid from a, well-to-do back­ground with, you know, adven­tur­ers and like his grand­fa­ther flew a plane from Cana­da to Africa or some­thing, and his father had inter­est in Emer­ald, Mines, all sorts of dodgy shit going on. And then you drop kids, you know, a kid who’s on the spec­trum and a very intel­li­gent, bright kid on the spec­trum with a phys­i­cal­ly and emo­tion­al­ly abu­sive father and you, and drop him in those sorts of envi­ron­ments with those sort of wild camp things to sur­vive.
[01:14:56] Cameron: You know, did a num­ber on him, uh, his child­hood did a num­ber on him, def­i­nite­ly.
[01:15:01] Tony: Well, he seems to, I mean, I, I’ve heard him talk about this before. He seems to think that’s, that’s good. That, you know, tough­ened him up for life and, you know, it’s behind his whole polit­i­cal phi­los­o­phy of gov­ern­ment get­ting out­ta the way and indi­vid­ual lib­er­tar­i­an­ism and things like
[01:15:15] Tony: that.
[01:15:16] Cameron: Mm
[01:15:17] Cameron: Mm
[01:15:18] Tony: And, but I got up to the part where he had just, you know, banked twen­ty-two mil­lion dol­lars from the sale of his first com­pa­ny.
[01:15:24] Tony: The, what was it called? Zip two or some­thing about, uh, uh, you know, basi­cal­ly, uh, Google Maps before it was Google Maps, you know, putting loca­tions on maps and then sell­ing it to news­pa­pers to bol­ster their clas­si­fied busi­ness­es.
[01:15:41] Tony: Made a lot of mon­ey out of it. Very clever, very clever pro­gram­mer, coder and busi­ness
[01:15:46] Tony: per­son.
[01:15:48] Cameron: Yeah. And then went on to build X, which became part of Pay­Pal. And then, you know, decides he’s gonna get into the rock­et busi­ness.
[01:15:58] Tony: Yeah. I was also sur­prised that from a very young age, he was deter­mined to, to, to work, to solve these prob­lems that
[01:16:04] Cameron: Mm-Hmm.
[01:16:05] Tony: human­i­ty. Yeah.
[01:16:07] Cameron: Yeah.
[01:16:07] Cameron: I think that’s a big thing to under­stand about Elon that I got from the book is this, you know, he was a teenag­er who decid­ed he was gonna solve the world. He was gonna solve the bank­ing indus­try. He was gonna solve cli­mate change and he was gonna get human­i­ty off plan­et. And now he’s in his what­ev­er for­ties and still focused on those things.
[01:16:29] Cameron: He’s actu­al­ly built busi­ness­es around them. Like he’s, uh, he is intense. He’s seri­ous,
[01:16:38] Tony: Yeah. Yeah. I mean,
[01:16:39] Cameron: He’s got a vision.
[01:16:40] Tony: And with an engi­neer­ing back­ground that he had, he was, um, focused on elec­tric vehi­cles for a long time before um, Tes­la came along, as you’re say­ing, in his teens. So that was inter­est­ing. Any­way, inter­est­ing. Read. I rec­om­mend the book to
[01:16:52] Tony: any­one. Isaac­son always does a good job of, with a biog­ra­phy.
[01:16:56] Tony: Very read­able.
[01:16:57] Cameron: Yeah. Yeah. He does a very good job. I agree.
[01:17:01] Tony: And, uh, I went to see Paul Weller on Fri­day night at the Syd­ney Opera house, which was a fan­tas­tic con­cert. Big Weller fan from way back.
[01:17:09] Cameron: mm
[01:17:10] Tony: Real­ly, real­ly good. Lots of jazz and funk and, you know,
[01:17:15] Tony: um, not trip­py, but you know, slow bal­lads and then fast rocky songs. It was real­ly good.
[01:17:22] Cameron: mm Does he have a brass sec­tion for doing style can­cel stuff or is it all on a key­board?
[01:17:27] Tony: Yeah, pret­ty much all on the key­board. He has one brass mem­ber who plays most­ly the sax­o­phone, but I did notice a flute and, um, what’s that one where you blow into the key­board? I for­get what that’s
[01:17:38] Tony: called. Um, one of those, um, and then they had lots of per­cus­sion and key­boards doing the brass
[01:17:44] Tony: as well,
[01:17:46] Tony: And a young
[01:17:47] Tony: back­ing band, young band mem­bers, gosh, they must have been in, you know, 21 if that.
[01:17:53] Cameron: mm-Hmm. And you were telling me off air that, uh, his recent work is real­ly
[01:17:58] Cameron: good,
[01:17:59] Tony: Oh yeah.
[01:18:00] Cameron: bet­ter with time.
[01:18:01] Tony: does. Yeah. I mean, I’ve always been a Jam fan and, uh, style Coun­cil fan, but his, his indi­vid­ual offer­ings are just as good. They’re fan­tas­tic.
[01:18:09] Cameron: mm
[01:18:10] Tony: Yeah. Hard­ly rec­om­mend. Well hard­ly rec­om­mend them all. But Wild­wood and Heavy
[01:18:14] Tony: Solar are two ones I go back to a lot.
[01:18:18] Cameron: mm Well, I’ll have to check out some of his more recent stuff. I, I mean, I was a
[01:18:23] Cameron: big fan of Jam and Style Coun­cil back in the eight­ies. Good stuff.
[01:18:31] Cameron: Well, um, I’m read­ing a book on the his­to­ry of Shaolin Tem­ple at the moment because Chrissie and I are going to start our first pod­cast togeth­er this
[01:18:41] Tony: Oh wow.
[01:18:42] Cameron: on Kung Fu.
[01:18:44] Tony: Does that mean after hours gets bumped?
[01:18:49] Cameron: why?
[01:18:49] Tony: After Hours
[01:18:50] Cameron: No,
[01:18:51] Tony: Oh, okay.
[01:18:51] Cameron: no. I can do, I can, I I can, do end­less num­ber of pod­casts. Appar­ent­ly, if there’s an hour in the day I
[01:18:57] Cameron: can use it to do a pod­cast. Uh.
[01:19:01] Tony: And is this, is this
[01:19:02] Tony: you, are you doing a pod­cast on Kung Fu so you
[01:19:04] Tony: can claim your Kung Fu mem­ber­ship as a busi­ness expense? Or, or what?
[01:19:10] Cameron: I know Tony. That is, that did not enter my mind at all. And if Mark tells you any­thing dif­fer­ent when you see him tomor­row, you can be assured that any­one lis­ten­ing to this can be assured that, that nev­er entered my mind what­so­ev­er. That said,
[01:19:32] Tony: Hmm
[01:19:33] Cameron: uh, if I am run­ning a busi­ness that involves Kung Fu, then maybe
[01:19:38] Cameron: I had­n’t thought about that, but it’s a good idea.
[01:19:40] Cameron: I shall take that up with my accoun­tant. Thank you for sug­gest­ing that, Tony.
[01:19:44] Cameron: We’re gonna do a pod­cast on Kung Fu, uh, the phi­los­o­phy, the his­to­ry, the dif­fer­ent styles. The ben­e­fits, phys­i­cal,
[01:19:54] Tony: Mm-Hmm
[01:19:56] Cameron: Emo­tion­al, uh, spir­i­tu­al, if you will. But one of the things of the spir­i­tu­al I learned from read­ing this book, I’m read­ing this book that was writ­ten a cou­ple of years ago by a Chi­nese schol­ar, uh, like a schol­ar­ly aca­d­e­m­ic, uh, his­to­ry of Shaolin.
[01:20:12] Cameron: One of the things that I did­n’t under­stand is it’s, uh, reli­gious her­itage. You know, you think of Shaolin, I know it’s a monastery, and you know, but you think of it as Kung Fu,
[01:20:23] Tony: mm-Hmm.
[01:20:24] Cameron: uh, real­ly it was built, the, the tem­ple itself was built like in the year four-nine­ty. They did­n’t real­ly start being known for Kung Fu until the six­teen-hun­dreds.
[01:20:38] Cameron: So for the first twelve-hun­dred years, it was just a Bud­dhist monastery, a very impor­tant Bud­dhist monastery. But the big thing that I did­n’t know was that Bod­hid­har­ma end­ed up there.
[01:20:49] Tony: Oh,
[01:20:50] Cameron: Now, do you know who Bod­hid­har­ma was?
[01:20:53] Tony: well, I’m, I thought he was the.
[01:20:56] Cameron: No, Sakya­mana. Gau­ta­ma was the Bud­dha. No, no, no. Not the Bud­dha.
[01:21:03] Cameron: Bod­hid­har­ma. I’ve known about Bod­hid­har­ma since I got into Zen. Bud­dhism when I was like 18. Bod­hid­har­ma is the founder of Zen Bud­dhism, but he actu­al­ly found­ed what’s called Chan Bud­dhism, which was the Chi­nese ver­sion of what became Zen Bud­dhism when it went to Japan.
[01:21:23] Cameron: Zen is the Japan­ese ver­sion of Chan. Bod­hid­har­ma went from India to Chi­na. So Bod­hid­har­ma is tra­di­tion­al­ly recog­nised as the guy who took Bud­dhism to Chi­na again in there, like 500 CE. Um, he went from India to Chi­na, took Bud­dhism, but it was Chan Bud­dhism. So if you know what Zen, you know how, yeah. So there’s a lot of dif­fer­ent kind of forms of Bud­dhism.
[01:21:53] Cameron: Bud­dhism had been, you know, I think the Bud­dha sort was around like 500 b, CE, so it was like a thou­sand years after, uh, Bud­dha him­self had died if he exist­ed. Um, the Chan is like the ascetic, intel­lec­tu­al branch of Bud­dhism. It’s not inter­est­ed in gods or any­thing like that. It’s about, it’s inter­est­ed in enlight­en­ment through a pure intel­lec­tu­al process of rec­og­niz­ing the illu­sion of the dual­i­ty and that the uni­verse is a uni­ty.
[01:22:31] Cameron: There is the one­ness. All the stuff that I talk about in my book, you know, the, so
[01:22:37] Cameron: Advai­ta, my, you know, um, philo­soph­i­cal her­itage I guess comes from a thing called Advai­ta Vedan­ta, which comes out­ta Hin­duism, which is Advai­ta. Vedan­ta is to Hin­duism. What. Chan is to Bud­dhism like the intel­lec­tu­al approach to enlight­en­ment that was con­tained with­in the core of a very large expanse of reli­gious teach­ings and spir­i­tu­al tra­di­tions that involve all sorts of dif­fer­ent branch­es and sects and break­aways and that kind of stuff.
[01:23:13] Cameron: Um, so any­way, I I, I, I’ve known about Bod­hid­har­ma, as I said for­ev­er, but I did­n’t real­ize that he end­ed up at Shaolin and Shaolin then became the cen­ter of Chan Bud­dhism in Chi­na for over a thou­sand years. It was the lead­ing insti­tu­tion teach­ing Chan Bud­dhism. Um, but then even­tu­al­ly that sort of start­ed to decline at, I think dur­ing the Ming Dynasty peri­od.
[01:23:43] Cameron: And they became known for Kung Fu. They start­ed, you know, they’d always, the, the tra­di­tion is that Bod­hid­har­ma brought Kung Fu to them, but you know, it’s not real­ly backed up by any­thing. It was a over 1200 years lat­er when they real­ly start­ed becom­ing known for that. But they were train­ing monks up and send­ing ’em off to do, you know, you know, on behalf ini­tial­ly of the Ming Dynasty, the Ming gov­ern­ment off to fight bat­tles.
[01:24:06] Cameron: They’d send in 50 Kung Fu experts to go and put down a wall, or there was a lot of, you know, I think it was the Mon­gols. Under Kublai Khan, Genghis Khan and Kublai Khan. That ran Chi­na for about a hun­dred years. And then there that devolved into a lot of War­lordy stuff. And then the Ming Dynasty arose, and then the Mon­gols attacked the Ming dynasty and there was a lot of strife.
[01:24:31] Cameron: Any­way, that’s when, and the monastery got sacked at one point, Shaolin got sacked and burned by some rebels. They weren’t able to defend it. So it was like in the 15 hun­dreds. And so they were like, all right, enough of this bull­shit. We’re gonna invent Kung Fu. And they invent­ed Kung Fu and start­ed devel­op­ing these high­ly skilled war­riors who then became famous, uh, around the world.
[01:24:58] Cameron: And that’s where Kung Fu comes from. So any­way, I’ve been read­ing a book on the his­to­ry of all of this for this new pod­cast, which is called Kung Fu K‑U-N-G-F-U-S-E‑D, which
[01:25:12] Cameron: Fox came up with.
[01:25:13] Tony: Ah, that’s
[01:25:15] Tony: great.
[01:25:16] Cameron: about a year ago, we were come, we were dri­ving home from a Kung Fu class one day. He goes, I’m not sure if I’m sup­posed to do this or that, or he goes, I’m so con­fused.
[01:25:25] Cameron: And we were like, oh man, that’s gold. So
[01:25:28] Tony: is gold. That’s great.
[01:25:31] Cameron: but it’ll be an oppor­tu­ni­ty for Chrissie and I not only to talk about Kung Fu, which we spend most of our time talk­ing about any­way. Um, but also to talk about the philo­soph­i­cal aspect of it, the Chan Bud­dhism and how that inter­faces with, um, Kung Fu. So
[01:25:45] Tony: Are you gonna do a seg­ment on injury of the week?
[01:25:49] Cameron: That’s good. I’ll make a note of that. Yes.
[01:25:53] Cameron: Injury of the week. I like that. ’cause I have one, um. Then I was clean­ing up over the week­end at some point and I put Moon­struck on in the back­ground while I was clean­ing up. And Chrissie said, I’ve nev­er seen this. And I was like, yes, you have. You sat down and watched it with me the last time you told me he had­n’t seen it like 13 years ago.
[01:26:15] Cameron: She said, oh, I must’ve been asleep or some­thing. I don’t remem­ber any­thing about it. So we sat down and watched Moon­struck, uh, over the week­end and you know, she’s been warm­ing up to Nico­las Cage over the last cou­ple of years. Not a big Nico­las Cage fan, but she watched that, what­ev­er, like the
[01:26:31] Tony: Ring
[01:26:31] Cameron: genius? No, the one before that, you know, with, um, yeah,
[01:26:36] Tony: uh, bur­den of mas­sive
[01:26:37] Tony: genius.
[01:26:38] Cameron: that one. She liked that.
[01:26:41] Cameron: And then she, you know, she liked his per­for­mance in
[01:26:43] Cameron: Ren­field and uh, so she’s warm­ing up to Nico­las Cage and, oh man,
[01:26:48] Tony: You’ve got­ta show us, you’ve got­ta show us some of the
[01:26:50] Tony: good ones though, like wild at heart and, um,
[01:26:54] Tony: what
[01:26:55] Cameron: She’s seen that, but she’s prob­a­bly for­got­ten.
[01:26:57] Tony: Yeah, Right?
[01:26:58] Cameron: Red Rock West, wild at Heart, Vam­pire’s Kiss. There’s an end­less num­ber of great Nico­las Cage films. But Moon­struck, I mean, it is the per­fect, it is a per­fect film. All of the char­ac­ters in it are per­fect. The dia­logue is per­fect. The music is per­fect.
[01:27:15] Cameron: Whether it’s, you know, it starts with, uh, Dean Mar­tin, that’s amore and it has La Boheme, and it’s just fan­tas­tic music. All of the cast, tremen­dous share was at the height. I think she was like nev­er. She was like forty-One. He was twen­ty-three, he was twen­ty-three when he is the my boy’s
[01:27:36] Tony: Yeah.
[01:27:36] Cameron: when he made that film.
[01:27:39] Tony: Tell your boys to
[01:27:40] Cameron: I lost my hand, I lost my bride. He has his hand, he has his bride.
[01:27:48] Cameron: It was like he was 23 and ful­ly real­ized with this over the top, per­for­mance, art, act­ing, you know, which he’s then per­fect­ed over the next 30 years. Any­way. Yeah, noth­ing makes me hap­pi­er than a Nico­las Cage film.
[01:28:08] Cameron: Hey, did you see the Christo­pher Walken Super Bowl ad?
[01:28:11] Tony: I did­n’t know I watched the Super Bowl yes­ter­day, but I did­n’t see any ads.
[01:28:16] Tony: They don’t show the US ads on the Aus­tralian tele­cast.
[01:28:18] Tony: Yeah,
[01:28:20] Cameron: A great Christo­pher Walken ad is, I think it’s an ad for BMW, but it’s basi­cal­ly him run­ning into peo­ple through­out his day and all of them are doing their Christo­pher Walken impres­sion. And the catch line is like, there’s only the orig­i­nal and you know, don’t accept any sub­sti­tutes like, but for a BMW
[01:28:37] Tony: right.
[01:28:39] Cameron: it’s just him get­ting annoyed by peo­ple doing Christo­pher Walken impres­sions at him all day, which I’m sure he gets like, you know, that must be either flat­ter­ing or real­ly annoy­ing.
[01:28:51] Cameron: I’m not sure which.
[01:28:52] Tony: Yeah. Uh, that’s great. And I like those Sat­ur­day Night Live sketch­es where he goes, I,
[01:28:59] Tony: I don’t talk fun­ny. And then like
[01:29:04] Tony: every­one talks like him.
[01:29:06] Tony: Yeah,
[01:29:07] Cameron: I think they did one of those SNL things where it was like the Walken fam­i­ly
[01:29:10] Tony: it was, that’s the what I’m think­ing of.
[01:29:11] Cameron: yeah, 20 of them all doing Christo­pher Walken impres­sions. Um. Then
[01:29:18] Cameron: I, I was, lis­ten­ing to David, you know, David Cross
[01:29:21] Cameron: from Mr. Show Arrest­ed Devel­op­ment.
[01:29:27] Tony: I’m sure I don’t fol­low him.
[01:29:29] Cameron: Oh man. One of the great, great comedic genius­es. Him and Bob Odenkirk in Mr. show, still prob­a­bly up there with Python as my all-time favorites.
[01:29:40] Cameron: I saw an Eric Idle thing just before we went to Air. Eric Idle in the media recent­ly com­plain­ing about how he’s broke, um, how he called Python’s a finan­cial dis­as­ter.
[01:29:50] Cameron: He said peo­ple, it annoys him that peo­ple assume he’s wealthy and he’s not like Python. They just lost more mon­ey than they made appar­ent­ly. Python’s been a huge dis­as­ter. Yeah. He said, we own every­thing we’ve ever done and we are just, and we’re all broke. Like there’s no mon­ey in it. No, he’s broke any­way.
[01:30:06] Cameron: I dun­no about the rest of them, but what their mon­ey’s come from.
[01:30:09] Tony: because I thought they, um, they made out real­ly well when they did spam a lot. The music
[01:30:13] Tony: he
[01:30:13] Tony: wrote.
[01:30:14] Cameron: He said that made mon­ey. But, uh, that was 20 years ago
[01:30:19] Tony: Yeah. Okay.
[01:30:19] Cameron: did­n’t make enough for him to live on. Appar­ent­ly. He said he’s like, he’s 80 and still has to work for a liv­ing. You know, he still has to write every
[01:30:27] Cameron: day to, you know, sur­vive. So any­way, um, David Cross was, he’s got a pod­cast that he had Michael Ser­ra on who played his, um, well, you know,
[01:30:38] Cameron: nephew I guess in Arrest­ed Devel­op­ment.
[01:30:41] Cameron: But they got talk­ing about Russ­ian lit­er­a­ture and I went through a phase a cou­ple of years ago where I read a lot of Russ­ian lit­er­a­ture, but they were going on about Gagol and, um, Dos­to­evsky’s notes from the Under­ground, which David Cross was say­ing. If you read that, you know, where Woody Allen got all of his shtick from, it’s all notes from the Under­ground.
[01:30:58] Cameron: So there’s a num­ber of those that I had­n’t read and, and an Amer­i­can aca­d­e­m­ic from Syra­cuse Uni­ver­si­ty, George Saun­ders, who put out a book a cou­ple of years ago, uh, I think it’s called. Uh, it’s not called the Rus­sians, but some­thing like that. He, he basi­cal­ly, he, he’s taught Russ­ian lit­er­a­ture at Syra­cuse for like 30 years and it’s him, I think four sto­ries about Russ­ian clas­sics and why they’re impor­tant and inter­est­ing and the basis of all great writ­ing as I down­loaded that as well.
[01:31:27] Cameron: So I’m gonna go back into a Russ­ian lit­er­a­ture phase. Um, I real­ly, I think we’ve talked about this before, but going and read­ing, you know, some of those Russ­ian clas­sics, it’s one of those expe­ri­ences where you go, oh, holy shit. Like, I real­ize why this is great lit­er­a­ture, why pe It’s, you know, these books real­ly stand up.
[01:31:48] Cameron: Yeah. Crime and Pun­ish­ment, things like that. You go and read them today and you go, wow, this is peo­ple, it’s not like they were good 200 years ago or 150 years ago, and now they’re dat­ed. They, they stand up as great lit­er­a­ture, which is always amaz­ing to me. How lit­er­a­ture we were talk­ing about that when we were talk­ing about, um.
[01:32:08] Cameron: Uh, what’s his name? Went to Cuba Bull­fight­er, um, Amer­i­can author
[01:32:17] Tony: Oh. Um, hand me one.
[01:32:20] Cameron: Hem­ing­way. Like when I read all of his stuff, like last year, went on this
[01:32:25] Cameron: deep dive on Hem­ing­way and it’s a hun­dred years old. A lot of it, uh, you know, ear­ly 20th cen­tu­ry, mid-twen­ti­eth cen­tu­ry. And you go, this does­n’t date
[01:32:33] Tony: Mm. I love
[01:32:34] Tony: Hem­ing­way.
[01:32:35] Cameron: yeah. Well, it’s bizarre to me that lit­er­a­ture. Like if you watch a film
[01:32:41] Cameron: from a hun­dred years ago, or even Cit­i­zen Kane Love, cit­i­zen Kane, but you have to watch it with a cer­tain mind­set of, okay, this was made in 1941, you know, you have to
[01:32:54] Cameron: real­ize why it was inno­v­a­tive and, you know, make some allowances for some of the things and, but lit­er­a­ture’s not like that.
[01:33:01] Cameron: You can read this stuff and go just, just, just, I mean, it’s not like read­ing Shake­speare too, which writ­ten in, you know, Eliz­a­bethan Eng­lish and you have to make some allowances or you have to get into the groove of that. Um, I guess I’m not read­ing Dos­to­evsky in the Russ­ian, obvi­ous­ly, but in the trans­la­tion it just, it holds up like
[01:33:21] Tony: Yeah.
[01:33:21] Tony: Well, like, like I, uh, Her­man Hess, one of my favourite authors like that, you know, writ­ing a hun­dred years ago. Yeah. Sid­dhartha, it remind­ed me talk­ing about the Bud­dha. Sid­dhartha is a great book. It still holds
[01:33:32] Tony: up.
[01:33:33] Cameron: I haven’t read that. since I was like 20
[01:33:35] Tony: Mm.
[01:33:36] Cameron: and, you know, I should
[01:33:36] Cameron: dig that out.
[01:33:38] Tony: But all of Her­man Hes­s’s writ­ings is fan­tas­tic.
[01:33:42] Tony: They’re all real­ly good and they all real­ly hold up. Mm.
[01:33:46] Cameron: There you go. There’s more books for me to read. It’s just that’s, you know, this is why I hope AI can fix mor­tal­i­ty, dude, because there’s just so
[01:33:55] Tony: So much to
[01:33:56] Tony: do.
[01:33:57] Cameron: Yeah. Like
[01:33:59] Tony: Yeah, I know what you mean.
[01:34:01] Cameron: and there’s just, there’s hun­dreds of books that I haven’t
[01:34:03] Cameron: got­ten to
[01:34:04] Cameron: yet and music I haven’t lis­tened to and films I still
[01:34:07] Cameron: haven’t
[01:34:07] Cameron: seen, and I’m like, places
[01:34:09] Tony: Mm.
[01:34:10] Cameron: been.
[01:34:10] Cameron: It’s
[01:34:10] Cameron: like, God, how do I, how do you fit in the full breadth of human expe­ri­ence in sev­en­ty-five years?
[01:34:18] Cameron: It’s just not, it’s not pos­si­ble. I need at least a cou­ple hun­dred years to even begin to
[01:34:23] Tony: Yeah.
[01:34:26] Tony: Well, it’s good. You’ve got the moti­va­tion to keep liv­ing
[01:34:30] Tony: and it’s not, it’s not reli­gious based. It’s, it’s, uh, it’s your own moti­va­tion. Yeah.
[01:34:34] Cameron: It’s my, it’s my wife who turned forty-five last week.
[01:34:37] Tony: Yeah. Hap­py birth­day to Chris­sy.
[01:34:40] Cameron: thank you. Yeah, she’s, she’s good. She can do the splits.
[01:34:44] Tony: Hmm. Yeah.
[01:34:46] Cameron: and she’s, she’s in her best phys­i­cal form of her life, like
[01:34:49] Tony: That’s incred­i­ble.
[01:34:50] Cameron: flex­i­bil­i­ty, strength, uh, through Kung Fu and you all the work she’s been doing.
[01:34:57] Cameron: The last cou­ple, yeah. At
[01:34:57] Cameron: forty-five. Like, uh, she’s inspir­ing. There are these peo­ple, you know, I’ve talked to peo­ple for years about age exten­sion, you know, when we’re curse-wile and all
[01:35:06] Cameron: that kind of stuff, you know. And, um, who was the guy with the long beard I had on the
[01:35:11] Tony: Yeah. Um,
[01:35:14] Tony: uh, old Audre Aubrey.
[01:35:16] Cameron: Aubrey De
[01:35:17] Tony: DeGrey. Thank you.
[01:35:18] Tony: Yeah.
[01:35:18] Cameron: Yeah. Talk­ing about it, extend­ing the human, the aver­age healthy human lifes­pan out to a hun­dred and twen­ty-five, and then 150. You talk to peo­ple and they go, I would­n’t wan­na live that long. Like, well, good. Don’t. Like
[01:35:33] Cameron: that atti­tude don’t want you around. It’s got­ta bring, bring it down. Like I don’t, I’ve nev­er under­stood, like, I get it.
[01:35:40] Cameron: If you’re sick and you’re wracked with pain or your mind goes on you and what­ev­er, then yeah, I can under­stand the desire not to be around. Like my friend Marie who passed away last year, you know, she was real­ly strug­gling health-wise, and she had said to me for like a year or two, I’m, I’m done. You know, I’m just, it’s too much of a strug­gle.
[01:35:58] Cameron: I’m, I’m not enjoy­ing it any­more and I get that. But if you can be healthy, there’s just so much to do, man, so much to, to suck the mar­row out of life. It’s, I dun­no,
[01:36:08] Cameron: there’s.
[01:36:09] Tony: I agree. And as investors think of the com­pound inter­est growth.
[01:36:18] Tony: Think how rich you’ll be if you live to be 125.
[01:36:23] Cameron: With my track record, Tony. It’s, uh, that’s the one prob­lem I have with liv­ing along the line is I got­ta fig­ure out, I, I, I, I’m with Eric Idle, I’m gonna be 80 and still hav­ing to, you know, make pod­casts the way I’m going.
[01:36:37] Tony: You and Rod­dy.
[01:36:40] Cameron: Yeah. Is he mak­ing pod­casts?
[01:36:41] Tony: not mak­ing pod­casts, but he will be work­ing until he’s
[01:36:43] Tony: 80.
[01:36:44] Cameron: Yeah. Yeah, yeah. Yeah. Any­way, you know, I can’t com­plain the work that I do.
[01:36:51] Cameron: Yeah. as long as I can con­tin­ue to get away with doing what I
[01:36:54] Tony: hmm.
[01:36:54] Cameron: Yeah. Do a pod­cast on Kung Fu, why not? Let’s do it.
[01:36:58] Tony: Well, I look for­ward to it. Well done.
[01:37:02] Cameron: Yeah. Thanks Tony. Well, thank you Tony for turn­ing up. Thank you to every­body out
[01:37:07] Cameron: there. Uh, thank you to Matt and Toby, and, uh, we’ll be back next week.
[01:37:12] Tony: Yeah. Uh, hap­py ASX.
[01:37:16] Cameron: It Hap­py share mar­ket.