QAV 730 — Consistency Is The Key

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QAV 730 Club

 

[00:00:00] Cameron: Wel­come back to QAV episode 730. How are you today, Tony Kynas­ton?

[00:00:14] Tony: I’m very well,

[00:00:15] Tony: thank you, Cameron Reil­ly.

[00:00:16] Cameron: Give me, give me a hook. What’s your hook, Tony? We need a hook.

[00:00:19] Tony: I got a tip for you,

[00:00:21] Tony: Cam.

[00:00:22] Cameron: Yeah, what’s the tip?

[00:00:23] Tony: Don’t lis­ten to tips. I give

[00:00:27] Tony: you the five stocks which are going to ben­e­fit from the US elec­tion.

[00:00:31] Cameron: Yeah, what are they?

[00:00:32] Tony: I don’t know. No one

[00:00:33] Tony: does. You can’t pre­dict it.

[00:00:37] Cameron: Tony and I were just talk­ing about how to get peo­ple’s atten­tion on Tik­Tok in one sec­ond based on some­thing my, one of my sons was telling me yes­ter­day, got to get them in one sec­ond and gauge them, get a hook.

[00:00:49] Tony: And we know our lis­ten­ers are far more intel­li­gent than to be click bait­ed to get invest­ment advice, as opposed to the major­i­ty of the pop­u­la­tion

[00:00:57] Tony: who seem to do that.

[00:00:59] Cameron: Yeah. Uh, well, Tony, um, I’d, I’d love to tell you what’s been hap­pen­ing in the all ordi­nar­ies this week, but I haven’t been pay­ing atten­tion because you told me to stop pay­ing atten­tion. Uh, so it’s, I’m like a crack

[00:01:12] Cameron: addict. I’m try­ing not to look.

[00:01:15] Cameron: There have been a cou­ple of stocks that have moved and I’ve had to do some­thing about them, so,

[00:01:20] Tony: Mm hmm.

[00:01:22] Cameron: I think we could talk about that.

[00:01:23] Cameron: SGI, your pulled pork from a lit­tle while ago, stealth group, not involved in drones or, or CIA black sites or, you know, black ops or any­thing like that, sur­pris­ing­ly.

[00:01:39] Tony: So we can’t mar­ket it as one of the, get our tip on

[00:01:42] Tony: what stock­’s going to ben­e­fit from the war in Ukraine.

[00:01:46] Cameron: That’s right, not this one,

[00:01:48] Cameron: um, uh,

[00:01:51] Tony: No, because as I recall, it’s, it’s a chain of hard­ware stores in West­ern

[00:01:54] Tony: Aus­tralia

[00:01:55] Tony: from mem­o­ry.

[00:01:56] Cameron: hard­ware stores, that’s right. So they dropped, uh, 9%, uh, in a sin­gle day on the 22nd of July, which was yes­ter­day, I think, when we were record­ing this. Um, dropped from 2. 20 down to 20 cents.

[00:02:16] Tony: No, that does­n’t sound right. 2. I had a look at, when I got you a show notes, it

[00:02:22] Tony: looked like a drop from 22 cents to 21 cents to me.

[00:02:26] Cameron: Well, it was 23 cents on the 18th and then 22 cents on the 20 cents back up to 21 today, but I had to sell it from our live port­fo­lio. And when I went dig­ging to try and explain why there was a sud­den drop. The only news that I could see was that seemed to be at all recent and some­what maybe rel­e­vant was in Stock Doc­tor, there was some­thing called an appli­ca­tion for quo­ta­tion of secu­ri­ties.

[00:02:53] Cameron: It said 14, 444, 903 ordi­nary shares at issue price of 24. 23 cents each as part of the con­sid­er­a­tion for the acqui­si­tion of 100 per­cent of the issued shares in Force Tech­nol­o­gy Inter­na­tion­al Pty Ltd, noth­ing to do with. Star Wars or Jedi’s either. They’re just these com­pa­nies all with mis­lead­ing names here.

[00:03:17] Cameron: Pre­vi­ous out­stand­ing shares were basi­cal­ly 101 mil­lion. Cur­rent out­stand­ing shares were 115 mil­lion. So they added 15 per­cent of new shares. Is that the val­ue why the share price dropped by

[00:03:31] Cameron: 9%?

[00:03:33] Tony: Well, I don’t think it is because those shares were issued on the 14th of June. Mm hmm. So it’s tak­en a whole month to get to where we are now. So that’s more like­ly to be more recent news. But I could­n’t, I had a look and I could­n’t see any announce­ments or any research to sug­gest why, but I would say the ADT for this stock is very low.

[00:03:52] Tony: It’s like. 10, 000. Um,

[00:03:55] Cameron: What? 10,

[00:03:56] Tony: yeah. And so it’s not going to take a big par­cel of shares, um, par­tic­u­lar­ly if it’s sell­ing, to dri­ve the price down. So I think it’s just going to be one of those stocks which has, um, high volatil­i­ty.

[00:04:11] Tony: Why don’t you believe

[00:04:16] Cameron: real­ly? God, it is too. I won­der why I end­ed up own­ing it.

[00:04:25] Tony: me? You had to look it up for your­self.

[00:04:28] Cameron: I believed you. I just want­ed to see it for myself. Wow. That’s, uh, yeah, so yeah. Okay. I must’ve snuck through my ADT check. It must’ve been high­er when I added it back in, no, only in June. I don’t

[00:04:43] Cameron: know. Uh, all right. Well, maybe, so maybe, uh, Force Tech­nol­o­gy sold a bunch of the 14 and a half mil­lion shares that they got.

[00:04:52] Tony: Yeah, could have. And the peo­ple who sub­scribed at that stage are under­wa­ter. So there could be some real ones. With

[00:04:59] Tony: them, but who knows?

[00:05:01] Cameron: Right. Okay. So, uh, leav­ing aside that. My dates were out. Um, would the issuance of a big chunk of shares like that pos­si­bly lead to a drop in the val­ue of share price?

[00:05:18] Tony: Well, very much so. So nor­mal­ly when com­pa­nies are issu­ing shares, they take that into account. So, um, uh, they sh they should have, I’m just look­ing at what the price was before they announced. They should have fac­tored into the account that if they’re issu­ing shares at 24, 24. 23, that that was going to be about what the share price was worth after the dilu­tion of 15 mil­lion new shares.

[00:05:46] Tony: That’s usu­al­ly how it works. Um, it does­n’t always end up that way because the mar­ket’s the mar­ket and peo­ple can react quick­ly and dri­ve the price down or react the oth­er way and like what they’re see­ing and dri­ve it up. So you don’t always have that sort of effect where the dilu­tion is tak­en into account with the new share price.

[00:06:03] Tony: And that’s how peo­ple arbi­trage it. If you’re offered shares and it’s below what you think they’re going to trade at after the new shares are added, then you can buy. And if you think it’s going to trade above, you don’t.

[00:06:13] Tony: So

[00:06:14] Tony: that’s typ­i­cal­ly how it

[00:06:15] Tony: works.

[00:06:16] Cameron: 17th of June, the share price was 22

[00:06:18] Cameron: cents, jumped up to 24 for a lit­tle bit and then went down to 20 and has been sort of trad­ing between 24 and 20 ever since. So

[00:06:28] Tony: Yeah, well, I’m sur­prised they actu­al­ly got that, that issuance away then if the, uh, yeah, the share price closed at the end of March, end of May, sor­ry, at 23 cents. But if they’re offer­ing new shares at 24,

[00:06:41] Tony: Um, I’m sur­prised they were

[00:06:42] Tony: able to issue them, but any­way,

[00:06:44] Cameron: Hmm.

[00:06:45] Tony: don’t

[00:06:45] Tony: know.

[00:06:46] Cameron: Alright, well that bit me on the arse, SGI. The next one was, um, ATP, I want­ed to ask you about. Our old friends Atlas Pearls. So they were back at the top of the buy list

[00:06:56] Tony: Mm hmm.

[00:06:58] Cameron: Uh, peo­ple may recall back in April, we had to sell it when it dropped 32 per­cent in a sin­gle day. When it announced that it’s, uh, the Pearl auc­tion in Kobe in Japan had­n’t gone as well as they hoped and they held onto a bunch of stock and did­n’t sell it and I, I looked them up again yes­ter­day when I was look­ing for some­thing to replace SGI with and noticed that they’ve had anoth­er auc­tion in Japan since then and again they only got the same price they were get­ting back in April and they held onto some stock for the same rea­son and I did­n’t buy it.

[00:07:35] Cameron: Because you said last time, and I quote, a bit dan­ger­ous buy­ing some­thing that’s going to be influ­enced by a com­mod­i­ty that we can’t track

[00:07:43] Tony: Mm hmm.

[00:07:43] Cameron: being pearls, the pearl mar­ket. You did say it seemed to be pret­ty volatile.

[00:07:47] Cameron: So,

[00:07:49] Tony: Yeah, and it’s auc­tion based, it’s not like a con­tin­u­ous mar­ket that seems to be open and peo­ple are trad­ing it like gold. So, uh, yeah, it’s always going to be a volatile stock, which is prob­a­bly why it’s on our buy list, because it’s, um, it is that kind of, it’s a val­ue stock because peo­ple are wary of over­pay­ing for some­thing which

[00:08:08] Tony: could be so volatile.

[00:08:11] Cameron: That said, and I hummed and

[00:08:13] Cameron: hawed about this yes­ter­day, we talked about this when we, uh, did men­tion them last, back in April. They have had a great run, um, well they did have a great run, so going back to a year ago, they were trad­ing at about 3 or 4 cents. They got to as high as 21 cents in Feb­ru­ary this year.

[00:08:35] Cameron: have slid down to about 10 cents now. So, uh, very volatile. Um,

[00:08:43] Tony: You’d think they’d be using AI to make pearls with that kind

[00:08:46] Tony: of volatil­i­ty in the stock.

[00:08:50] Cameron: and part of me thought, well, it could go for anoth­er run up to 21 cents. And then I thought, and then it could drop

[00:08:55] Cameron: 32 per­cent the next day, like it did in April. So,

[00:08:59] Tony: Yeah.

[00:09:00] Cameron: uh, yeah. So just a flag for, uh, any­one out there think­ing about ATP, cause it’s on the top of the buy list this week. Um, maybe, maybe think hard about it.

[00:09:12] Tony: Yeah. Be aware, be aware of what you’re buy­ing. Um, I, I was going to do a pulled pork on it at the start of the year and I decid­ed not to for that very rea­son that if it’s, if it’s reliant on infre­quent auc­tions to set its rev­enue, it’s going to be hard for us to, you know, it’s going to be volatile. It’s going to be hard for us to have any sort of reli­able qual­i­ty about the stock.

[00:09:32] Tony: I thought,

[00:09:33] Cameron: I won­der why the. Pearl mar­ket is so volatile.

[00:09:36] Tony: pret­ty small, I would have thought. Who, who uses pearls?

[00:09:40] Tony: Apart from jew­ellers.

[00:09:42] Cameron: I don’t know. Are there any

[00:09:45] Cameron: com­mer­cial appli­ca­tions of pearls?

[00:09:48] Tony: not that I know of. I

[00:09:51] Cameron: Me either.

[00:09:52] Tony: should go and rag my wife’s jew­ellery box and see if I can use them for some­thing. Get a return on my invest­ment. Apart

[00:09:59] Cameron: yeah,

[00:09:59] Tony: mar­i­tal hap­pi­ness.

[00:10:01] Cameron: yeah. Alright, so that’s the ATP sto­ry, uh, CVP, CVP, CivMec, we’ve talked about,

[00:10:11] Tony: Is

[00:10:12] Tony: it CVP or CVL?

[00:10:13] Tony: Yeah.

[00:10:14] Cameron: yeah, CVL, CivMec,

[00:10:18] Tony: Civ­il and

[00:10:18] Cameron: per­cent in the last week, um, I added them to the DP back in March of 2021, they’re up 90 per­cent since then, which, Yeah, over, what’s that,

[00:10:32] Tony: That’s good.

[00:10:33] Cameron: three and a bit years, it’s okay, it’s not great, but it’s bet­ter than

[00:10:38] Tony: Very good.

[00:10:39] Tony: Yeah,

[00:10:40] Cameron: But, um, I, I was try­ing to fig­ure out why they’re up 20 per­cent in the last week, the only thing I could see was a notice that said, Pro­posed change of domi­cile of the head com­pa­ny of the group from CIVMEC Ltd. domi­ciled in Sin­ga­pore to CIVMEC Aus­tralia Ltd. domi­ciled in Aus­tralia. Do you think they’re con­nect­ed?

[00:10:59] Tony: I do, but, um, I could­n’t remem­ber the rea­son­ing behind it. And I, I, it was either a ques­tion from some­one like Steve Mabb about this or it was a pulled pork I did. Um, I don’t know if you can search your data­base and see what I said, but I remem­ber vague­ly doing a pulled pork on this com­pa­ny and sug­gest­ing that when it moved back to Aus­tralia, that could be a cat­a­lyst for a share increase.

[00:11:24] Tony: Um, but I was, I did­n’t have, did­n’t have any­thing in my notes as to why, and I did a quick look at the, the sites today, and I could­n’t see any, um, obvi­ous rea­son for it, but I, I’m guess­ing it’s going to have some­thing to do with, uh, less, um, poten­tial­ly less shares on issues, so like when BHP came back to Aus­tralia, Domi­cile back to Aus­tralia, they stopped trad­ing on the, uh, UK exchange and the Aus­tralian exchange and that seemed to give them a bit of a boost.

[00:11:55] Tony: And, um, but it also could have to do with man­dates that now it’s an Aus­tralian com­pa­ny. Some of the oth­er fund man­agers could buy into it too. But I, I, yeah, I could­n’t see the rea­son. I did a quick research check this morn­ing, but I do remem­ber talk­ing about it ear­li­er on.

[00:12:12] Tony: So it might be in your notes

[00:12:13] Tony: some­where.

[00:12:14] Cameron: it is, uh, episode 646, uh, Novem­ber 2023. You did a pulled pork on Civmec, and I’m just pulling up the tran­scrip­tion on the web­site now. Um, let’s see if I can see. The share­hold­er infor­ma­tion in Stock Doc­tor says almost half of the shares are list­ed as being owned by the Chess Depos­i­to­ry Nom­i­nees Com­pa­ny, which is, I think, peo­ple from Sin­ga­pore co invest­ing in Aus­tralia. So, if the com­pa­ny does go ahead and they put their plan in place, it comes to fruition, which is to say that what they’re doing is to repa­tri­ate to Aus­tralia.

[00:12:56] Cameron: Then we may see that we have all the shares on one exchange and there may be a bet­ter float avail­able to buy and sell in the share mar­ket. You said there’s also a low ADT on this stock, which is prob­a­bly a good thing because there are two large own­ers. One’s the CEO, one’s the chair­man, some­thing like 40 per­cent of the shares between them­selves.

[00:13:17] Cameron: So between Sin­ga­pore investors and the own­ers, it’s like 90 per­cent of the stock is account­ed for and it’s only the rump That’s trad­ing every day, so we have the low ADT. The oth­er rea­son for repa­tri­at­ing to Aus­tralia, com­pa­nies called out, is because they’re doing more and more work for the Navy and defence work, and the gov­ern­men­t’s get­ting tighter and tighter on their rules about local sourc­ing.

[00:13:39] Cameron: So the gov­ern­ment wants to buy Aus­tralian, and this com­pa­ny’s head offi­cers are cur­rent­ly in Sin­ga­pore, even though they do all of their work in Aus­tralia. Their staff are in Aus­tralia. It’s basi­cal­ly an Aus­tralian com­pa­ny in every­thing but name. So there you go.

[00:13:54] Tony: Okay. So it’s been viewed pos­i­tive­ly, per­haps for those two rea­sons then. Yeah. Cause you’re right. The court has allowed an EGM to go ahead for this com­pa­ny to redomi­cile back to Aus­tralia.

[00:14:06] Cameron: right. Inter­est­ing. Okay. So that’s that one. And now I’ve lost my bloody notes. Oh, here we go. All right. Good. Uh, what else did I have to talk about? The light port­fo­lios are catch­ing up to the bench­mark Tony, which is good,

[00:14:25] Tony: Good. Yeah.

[00:14:25] Cameron: in the right direc­tion. I

[00:14:27] Tony: Mm hmm.

[00:14:27] Cameron: mean, I think one or two of them are

[00:14:31] Cameron: ahead of the bench­mark and the oth­er cou­ple are behind, but all, all up as a group with the four of them, they’re catch­ing up, um, they’re going in the right direc­tion.

[00:14:39] Cameron: The bench­mark is sort of, um, stay­ing rel­a­tive­ly neu­tral while the port­fo­lios get bet­ter and bet­ter, which is good. Dum­my Port­fo­lio, of course, is con­tin­u­ing to do I think 1. 8 times mar­ket since incep­tion I saw, recent­ly. Um, the only oth­er note that I had is I got an email from one of our sub­scribers, Con­rad, who had some inter­est­ing, uh, feed­back on how his port­fo­lio is going.

[00:15:08] Cameron: He said he’s been fol­low­ing QAV for over three years now. Um, I’d like to say thank you for teach­ing me how to invest and report my QAV jour­ney and results. Last finan­cial year, my port­fo­lio returned 31. 4 per­cent time weight­ed return. Which was based on a mod­i­fied QAV sys­tem. After fol­low­ing the QAV sys­tem for a cou­ple of years, I found that I was reg­u­lar­ly falling out­side the rules due to work­ing long hours and hav­ing lit­tle time avail­able.

[00:15:36] Cameron: My alerts would get out­dat­ed and I reg­u­lar­ly missed com­mod­i­ty sales. Then I would be in no man’s land, hav­ing to make deci­sions on whether and when to sell, which affect­ed my port­fo­lio per­for­mance. So in Sep­tem­ber 2022, I start­ed a dum­my port­fo­lio based on a mod­i­fied set of rules. I ran this for about a year, achiev­ing 39 per­cent TWR on paper only.

[00:15:59] Cameron: I mod­i­fied, uh, adopt­ed the mod­i­fied rules for my real port­fo­lio in August last year. Basi­cal­ly, I want­ed a sys­tem that I could fol­low the fun­da­men­tal QAV prin­ci­ples with 100 per­cent dis­ci­pline. I mod­i­fied the Stock Doc­tor fil­ters to gen­er­al­ly only return about 30%. Three to eight com­pa­nies, which I then man­u­al­ly sought.

[00:16:17] Cameron: I looked at the com­pa­nies that have per­formed best for me over the years and found most of them were Stock Doc­tor recov­er­ing. So my fil­ters only returned this. The com­pa­nies that per­formed worse gen­er­al­ly had price to cash flow of less than 2. 5. I assume this was because often these com­pa­nies were finance com­pa­nies where the price to cash flow does­n’t mea­sure val­ue or the mar­ket was pun­ish­ing the com­pa­ny for some news I was­n’t aware of expect­ed drop in cash flow in brack­ets.

[00:16:46] Cameron: So I fil­ter out com­pa­nies with price to cash flow of less than 2. 5. I made lots of oth­er small­er changes, hap­py to go into detail if you’re inter­est­ed. I sus­pect that the port­fo­lio per­for­mance will flat­ten out in time as fill­ing the port­fo­lio with Stock Doc­tor recov­er­ing seems to give an ini­tial bump.

[00:17:04] Cameron: But based on the test­ing I have done, I’m con­fi­dent I can get close to long term QAV results, and most impor­tant­ly, I can fol­low these rules every day for the rest of my life. Regards, Con­rad.

[00:17:14] Tony: Fan­tas­tic.

[00:17:15] Tony: Yeah, it’s cer­tain­ly been, I think it’s great. And I had been think­ing, as you know, about Stock Doc­tor recov­er­ing as being poten­tial­ly some­thing we need to boost in the check­list. Um, so I need to go back to our regres­sion test­ing tool and check that. Um, but I like it. I think it’s fan­tas­tic. Well done, Con­rad.

[00:17:34] Tony: If you can give us any more details, like what you’re

[00:17:36] Tony: actu­al­ly fil­ter­ing on, that’d be great to know.

[00:17:40] Cameron: And, uh I’m not exact­ly sure how big his port­fo­lio is, but one of the ques­tions I had is, um, like, I guess he’s, he said he, before he would miss his alerts and miss com­mod­i­ty sells and he’s still going to have to do those things unless he’s got no com­mod­i­ty stocks in there and no alerts. You still need to, you know, Man­age your alerts and your com­mod­i­ty sales.

[00:18:09] Cameron: So I’m not sure how he’s, uh, han­dling that dif­fer­ent­ly, but be inter­est­ing to get him on, to have a chat. So Con­rad, thank

[00:18:21] Tony: it’d be great.

[00:18:22] Cameron: Shoot me, shoot me anoth­er email and,

[00:18:23] Tony: done.

[00:18:25] Cameron: come on and we can, you can take us through it in more detail.

[00:18:28] Cameron: Well that’s all of my, uh, talk­ing points for today. Tony, what have you

[00:18:34] Tony: a few things to go through. Like you, I had some stocks in the news to, um, to men­tion. Uh, the, but before I do that, so last week we had, uh, some input. I think it was Dave from UWE was talk­ing about share buy­backs and he referred to Chap­ter 12 of, uh, What Works on Wall Street, the book by, um, O’Shaugh­nessy.

[00:18:58] Tony: And, um, cause I’m an epic pro­cras­ti­na­tor, I decid­ed to go back and reread. Chap­ter 12, but I picked up the book and turned over the front page and went, Oh, that’s real­ly good. That’s inter­est­ing. So I’ve been read­ing it from cov­er to cov­er again. So I haven’t got­ten to, I’ve done the first three or four chap­ters.

[00:19:14] Tony: I haven’t got­ten to chap­ter 12 yet. Um, how­ev­er, it’s, uh, I want­ed to, um, Put some quotes into the show, because the, I know I skimmed through it when I first got this book a cou­ple of years ago, and now I’m read­ing it, um, I’m read­ing it like, lit­er­al­ly every time I sit down at my desk, I’ll read anoth­er para­graph and get my high­lighter out and find some­thing which just res­onates so well, um, like I said, I’m only up to Chap­ter 3, so the book may go down­hill after that, or Chap­ter 4, um, but at the moment, I’m, I’m gonna put this very high on the list of books to rec­om­mend for any­one who, um, uh, likes, like us, likes invest­ing.

[00:19:56] Tony: Uh, it’s, it’s fan­tas­tic. And so I might even, uh, every now and then in the show just include some quotes because they res­onate with what you and I talk about. And we’d spo­ken about recent­ly about, uh, stick to it ness, so the abil­i­ty when you haven’t had a good year to not change. direc­tion or capit­u­late or sell up and try some­thing dif­fer­ent.

[00:20:19] Tony: And O’Shaugh­nessy has some good quotes on that, which I’ll read out now. So, uh, he’s going to just take a snip­pet here. He’s talk­ing about the, uh, the secret to suc­cess of being a good investor is to fol­low a suc­cess­ful invest­ment strat­e­gy. And he says fol­low­ing a suc­cess­ful invest­ment strat­e­gy requires the abil­i­ty to con­sis­tent­ly, patient­ly, and slav­ish­ly stick with the strat­e­gy, even when it is per­form­ing poor­ly rel­a­tive to oth­er meth­ods.

[00:20:47] Tony: He goes on, The key to out­stand­ing long term per­for­mance is to find strate­gies that have the high­est base rate, then stick with that strat­e­gy, even when it’s under­per­form­ing oth­er strate­gies and bench­marks. Few peo­ple are capa­ble of such action. Suc­cess­ful investors do not com­ply with nature, they defy it.

[00:21:05] Tony: Most investors react very emo­tion­al­ly to the short term gyra­tions of the mar­ket, and I’ve seen many who fol­low my strate­gies and port­fo­lios in real time say, well, the strate­gies used to work, but they don’t any­more, after just a few months of under­per­for­mance. What appears dull and bor­ing in, uh, in the long term com­pi­la­tion of fac­tor returns becomes emo­tion­al and fright­en­ing when investors live through it in real time, lead­ing to doubt as to whether the long term results will some­how change.

[00:21:32] Tony: All of them, mean­ing suc­cess­ful strate­gies, are deeply con­sis­tent with that com­mon sense With what com­mon sense would tell you was true. Strate­gies that buy stocks that are sell­ing at deep dis­counts to cash flow, sales, earn­ings, EBITDA to enter­prise val­ue, and so on, do extra­or­di­nar­i­ly bet­ter than those that are will­ing to buy stocks with the rich­est val­u­a­tions.

[00:21:53] Tony: Dis­ci­pline is the key. The dis­ci­plined imple­men­ta­tion of active strate­gies is the key to per­for­mance. And I, I, you know, I talk about this, like, when peo­ple talk about Fol­low­ing the QAV process, I do bang on that it’s not nec­es­sar­i­ly the process that’s impor­tant, it’s the fact you have a frame­work and you stick to it.

[00:22:11] Tony: And I think O’Shaugh­nessy has said it more elo­quent­ly there, um, and that’s just an extract of, I think, Chap­ter 1. Uh, but, uh, he pro­vides a lot of evi­dence to sup­port what he’s say­ing, backed up with lots of research. So I thought that was, that was real­ly time­ly

[00:22:27] Tony: giv­en our dis­cus­sions over the last few weeks about QAV.

[00:22:30] Tony: Per­for­mance.

[00:22:31] Cameron: Yeah, and I was actu­al­ly think­ing of him at that quote when we were hav­ing that con­ver­sa­tion the oth­er day. I remem­ber, I remem­ber, um, when I read that book a few years ago, just being You know, um, almost on every page think­ing, wow, this just sounds like you, like, it just sounds like QAV is a thing. But he talks about how most, uh, pro­fes­sion­al bro­kers, the, you know, will change from strat­e­gy to strat­e­gy, jump hors­es con­stant­ly.

[00:23:01] Cameron: And that’s why they nev­er real­ly suc­ceed long term. Hmm.

[00:23:07] Tony: Or they invest with their gut. So they try and make pre­dic­tions. And um, there’s a few oth­er quotes about that too, which I might drop into the show in the future. But, but yeah, he’s, he presents the research, which shows that 70 per­cent of fund man­agers don’t beat the index. And then he says, answers the ques­tions, why?

[00:23:24] Tony: And a lot of it has to do with, as you say, peo­ple react­ing and chang­ing strat­e­gy mid­stream. Or, or approach­ing invest­ment as a, um, a sto­ry based, uh, sort of approach. So you’re talk­ing to man­age­ment, you’re try­ing to do some kind of analy­sis on the com­pa­ny. You’re think­ing that you’re a bet­ter analy­sis, you’re, you’re a bet­ter ana­lyst than your com­peti­tors and that you can pre­dict the future.

[00:23:51] Tony: And it just does­n’t work. And you’ll go through peri­ods where it will work and you’ll build a fol­low­ing and then it crash­es.

[00:23:57] Cameron: Yeah. And I guess there’s a lot of pres­sure on, uh, you know, fund man­agers or pro­fes­sion­al port­fo­lio man­agers where they have boss­es and investors and peo­ple who aren’t gonna be patient and tol­er­ant if their mod­el’s not work­ing for a year or two years. There’s a lot of pres­sure on them to get with the pro­gram and deliv­er results, you know?

[00:24:22] Tony: Yeah, I mean, a great exam­ple of that was in the dot com boom and sort of, you know, the last sort of three years of the 1990s or the, yeah, end of the cen­tu­ry when, um, there was a val­ue man­ag­er in Aus­tralia called, I think it was called Maple Brown Habit from mem­o­ry, uh, and they were Um, known as a val­ue investor and every year he’d come out and say, look, we’ve under­per­formed the mar­ket.

[00:24:47] Tony: We can’t under­stand why the mar­ket’s going up and putting so much mon­ey into these dot com stocks with no, you know, with no rev­enue and with no income, with no prof­it. And that just sounds crazy to us. And then like, It, you know, they had to keep say­ing that for three, four years straight. And then in the fifth year, they were heroes.

[00:25:08] Tony: Um, but they, you know, but half the peo­ple had tak­en their mon­ey out of the fund in between. And Buf­fett was say­ing that too, dur­ing that same peri­od. Look, I know I’m under­per­form­ing the mar­ket. I’m not going to change. The mar­ket’s wrong. And he was right too. But yeah, but he had to endure three or four years of, you know, declin­ing share prices while, um, the mar­ket went on a crazy tear into, uh, inter­net

[00:25:28] Tony: stocks.

[00:25:29] Cameron: Yeah, I was think­ing about that the oth­er day. I watched this great video on YouTube over the week­end. It was, I think it was the, um, video they made for the last Berk­shire Hath­away AGM. That was sort of the Char­lie Munger seg­ment. It was like a bio on Char­lie and all that kind

[00:25:51] Tony: a

[00:25:51] Tony: trib­ute.

[00:25:52] Cameron: Yeah, I was watch­ing that and it was noth­ing new that we haven’t already seen or read or heard before, but always good to see Char­lie in good form.

[00:26:03] Cameron: My favourite bits were him and War­ren on stage at an AGM and Char­lie makes some sort of wise ass crack and War­ren’s just sort of throw­ing his hands up in the air and shak­ing his head and he’s like, there he goes. um, yeah, I remem­ber, I can’t remem­ber if it was Char­lie or War­ren, when some­body asked them not long ago about arti­fi­cial intel­li­gence and the role that it’s going to have in invest­ing, and one of them said, it’s always, the oppor­tu­ni­ty of invest­ing is always oth­er peo­ple’s stu­pid­i­ty.

[00:26:32] Cameron: I think it was War­ren who said that.

[00:26:34] Tony: Right.

[00:26:35] Cameron: You know, it does­n’t mat­ter what tools are avail­able out there. It’s greed and impa­tience and fear of miss­ing out and all of those very human flaws that it does­n’t mat­ter what tools you’ve got or what tools, what your tools are telling you you should do. Like, you know, peo­ple lis­ten to this and we tell them stay ful­ly invest­ed, don’t sell, don’t, don’t change and they don’t care.

[00:27:02] Cameron: It’s the end of the day. It’s what they can live with, you know.

[00:27:07] Tony: Yeah. No, exact­ly. It’s, it’s, um, it’s, War­ren’s com­plete­ly right. I mean, AI might be the great­est gift to investors, but there’ll still be peo­ple who won’t com­plete­ly trust it. They’ll, they’ll say, Oh, this AI keeps buy­ing, you know, stocks, but I’m under­per­form­ing the mar­ket. I’m going to jump out of the AI port­fo­lio and jump into my own.

[00:27:28] Cameron: My AI

[00:27:29] Tony: Of Miss­ing Out Port­fo­lio and buy some

[00:27:32] Tony: Bit­coin or NVIDIA or what­ev­er, when the AI is safe. Because, yeah, my AI is bro­ken. Because if you, I mean, O’Shaugh­nessy backs me up and I’m con­vinced if an AI is any good at invest­ing, it’s going to invest in a rea­son­ably sim­i­lar way to how I do and how O’Shaugh­nessy does and how Buf­fett does.

[00:27:53] Tony: I mean, there’ll be dif­fer­ent riffs and dif­fer­ent vari­a­tions on it. Um, but And if, you know, if, if we’re only a seg­ment of the mar­ket and not the major­i­ty seg­ment of the mar­ket, then the mar­kets con­tin­ue, kind of con­tin­ue to be dri­ven by human behav­ior, which is chap­ter two of O’Shaugh­nessy talks about, you know, how we, we evolve to, um, to Jump quick­ly at frights and keep our­selves alive rather than take risks and how that’s um, you know, we lived in small vil­lages and we had to rely on the, on the herd so we fol­lowed it.

[00:28:24] Tony: Uh, and uh, that’s, that’s still a part of our brain and we’re not real­ly hard­wired for invest­ing.

[00:28:32] Cameron: Yeah, very good. Well, thanks for shar­ing that. You got any more for today or are you sav­ing them up for next

[00:28:36] Cameron: time?

[00:28:37] Tony: I’ll save the, I’ll save the HMR­C’s up for next time. I’ve got a few arti­cles about, uh, stocks that we, um, we look at. So Fortes­cue Met­als was in the news last week for bad rea­sons. They, they’re cut­ting 700 jobs and slow­ing their push into green hydro­gen. And this arti­cle is in the Fin Review.

[00:28:56] Tony: Fortes­cue will cut 700 jobs and slow its push into green hydro­gen in a blow to the Albanese gov­ern­men­t’s plan to make Aus­tralia a hydro­gen super­pow­er. Fortes­cue Chair­man, Andrew For­rest, said low car­bon or green hydro­gen still had a bright future, but his imme­di­ate focus would shift renew­able elec­tric­i­ty as he jet­ti­soned the tar­get for Fortes­cue to pro­duce 15 mil­lion tons, tons of green hydro­gen by 2030.

[00:29:21] Tony: The con­ces­sion comes after a six year peri­od in which Dr For­rest was one of the world’s lead­ing advo­cates for hydro­gen. And as Fortes­cue works to break down a cor­po­rate struc­ture that had pre­vi­ous­ly treat­ed its ener­gy and iron ore min­ing divi­sions as sep­a­rate. Com­pa­nies. So, you know, we, we’ve spo­ken about Fortes­cue being a red flag due to all the peo­ple, qual­i­ty peo­ple, exec­u­tives who had left the com­pa­ny in the last sort of 6 to 12 months.

[00:29:47] Tony: Uh, maybe this was the rea­son. Maybe the exec­u­tives who left just could­n’t see Green Hydro­gen work­ing. And now he’s had to cut 700 jobs and piv­ot away from it. So hope­ful­ly that’s the end of the woes at Fortes­cue, but I sus­pect it’s not.

[00:30:02] Tony: The oth­er thing that I guess is also going on in the back­ground, and there was anoth­er arti­cle which I haven’t put in the show notes, but Rio Tin­to has got approvals to begin an iron ore mine in, I think it’s Guinea, any­way it’s in Africa, in an area called Siman­du, which is look­ing like being as big as the Pil­bara in WA in terms of iron ore pro­duc­tion, and it’s in part­ner­ship with some Chi­nese com­pa­nies, so in the next cou­ple of years there’s going to be some real down­ward pres­sure on the iron ore.

[00:30:33] Tony: Price, accord­ing to peo­ple who wrote the arti­cle I read today on the Fin Review, which is a pre­dic­tion, but they’re talk­ing about, uh, Siman­du being at least 5 per­cent of the world’s iron ore, um, pro­duc­tion, and that’s got to be enough to sup­press prices some­where, so, yeah, I think, I think, um, Fortes­cue might have some

[00:30:54] Tony: dif­fi­cul­ties going for­ward.

[00:30:55] Cameron: And what did you take away from all of that about why he’s piv­ot­ing away, apart from the Rio threat, why he’s piv­ot­ing away from the green hydro­gen or damp­en­ing expec­ta­tions?

[00:31:06] Tony: Well, I don’t think the Rio threat’s behind him piv­ot­ing out of green hydro­gen. What he’s say­ing, I’ll quote again, Dr. For­rest said low­er ener­gy prices were the pri­or­i­ty for world lead­ers at a time when war in Ukraine and the Mid­dle East had roy­al com­mod­i­ty mar­kets dri­ven up the cost of ener­gy and chal­lenged the eco­nom­ics of hydro­gen, which is more expen­sive than nat­ur­al gas.

[00:31:26] Tony: In that envi­ron­ment, you’re not going to bring in major sources of green hydro­gen. which relies on cheap ener­gy prices, he said, we are not going to swim against the tide. So, he’s basi­cal­ly say­ing green hydro­gen works in a low, uh, low, uh, well, with a small com­pet­i­tive against nat­ur­al gas as a price, green hydro­gen works, but he’s, the prices are being held up by volatil­i­ty in the, in the, uh, mar­kets that pro­duce, uh, gas and oil around the world.

[00:31:55] Cameron: Okay. I’m not fol­low­ing that.

[00:31:58] Tony: Uh, So

[00:31:59] Cameron: ener­gy prices are high, isn’t that a good thing for

[00:32:02] Cameron: any­one who’s pro­duc­ing ener­gy or is it just hard­er to com­pete?

[00:32:05] Tony: uh, I think what he’s say­ing is it’s, I think it’s, I think he needs elec­tric­i­ty. I must admit, I’ve always strug­gled with this argu­ment of his, but I think he needs elec­tric­i­ty as an input to make green hydro­gen.

[00:32:18] Cameron: Uh,

[00:32:19] Tony: And elec­tric­i­ty prices are high because a lot of it’s gas fired. But I must admit, I’ve nev­er fol­lowed the sci­ence of the whole chain there, because if you’ve got cheap elec­tric­i­ty prices

[00:32:31] Tony: to pro­duce, Green hydro­gen.

[00:32:33] Tony: Why do you need

[00:32:33] Tony: green hydro­gen?

[00:32:35] Cameron: yeah. How is it com­pet­i­tive?

[00:32:37] Cameron: Apart from a

[00:32:37] Cameron: pure­ly ESG aspect, you know?

[00:32:41] Tony: Yeah, so, um, I mean, hydro­gen will have, um, oth­er appli­ca­tions, I guess, besides ener­gy, although we’re not very far away from planes being pow­ered by elec­tric­i­ty, I don’t think, and bat­ter­ies. if I’m, you know, if I can believe what I read. Uh, so and that was going to be one of the ways that green hydro­gen would be used.

[00:33:01] Tony: And it was also going to be used some­where else in the arti­cle it talks about being used in a test with I think it was Instat­e­ch Piv­ot to make fer­til­iz­er. But again, if you can do it with hydro­gen, you could prob­a­bly do it with elec­tric­i­ty, I would have thought. So if elec­tric­i­ty is an input into green hydro­gen, why don’t you just use the cheap elec­tric­i­ty to.

[00:33:21] Tony: Make fer­til­iz­er.

[00:33:22] Cameron: Alright. Inter­est­ing

[00:33:24] Tony: a com­plete new­bie to the area, but there’s cer­tain­ly a lot of tur­moil going on at Fortes­cue at the moment.

[00:33:30] Cameron: Hmm.

[00:33:32] Tony: A com­pa­ny on our buy list, AX1 Accent Group, they’re up 10 per­cent in the last week after a con­fes­sion sea­son trad­ing update, and so On the sur­face of it, I thought that when I read the arti­cle, I thought the share price might go down, but it’s gone up.

[00:33:51] Tony: And so the announce­ment reads, Accent Group Lim­it­ed, ASX AX1 is the code, advis­es that the Group EBIT For the full year end­ed 30th of June, 2024, it’s expect­ed to be in a range of 109 to $111 mil­lion. The expect­ed FY 24 EBIT range includes an addi­tion­al cha charge in H in the sec­ond half of approx­i­mate­ly 14.2 mil­lion relat­ing to Glue store where the com­pa­ny has made a deci­sion to exit 17 under­per­form­ing stores where required returns are not being achieved.

[00:34:27] Tony: And they go on. Access Accent Group CEO Daniel Agostinel­li said trad­ing con­di­tions across the group in H2 FY24 improved on H1 FY24 with like for like sales in H2 being 4. 1 per­cent ahead of pri­or year. So I think that’s the rea­son for the upgrade. They also, in a sep­a­rate announce­ment, announced that one of their brands called Nude Lucy, again a brand of shoe store, was being expand­ed into the U.

[00:34:58] Tony: S. and the mar­ket seemed to like that as well. So, um, I guess one of the rea­sons for call­ing it out is A lot of retail com­pa­nies came on to our buy list and we were talk­ing about this before we came on to air, that Super Retail Group is up 3 per­cent today. And I haven’t had a chance to look at why, but I’d haz­ard a guess that they’ve also said that Light for Life sales are doing bet­ter than expect­ed in retail.

[00:35:22] Tony: And one of the themes of the mar­ket going back 6 to 12 months was, with the cost of liv­ing, um, being high, Retail cus­tomers did­n’t have enough spend­ing pow­er to, to boost sales for these kind of retail com­pa­nies like Accent1. How­ev­er, they’re now call­ing out that, uh, at least in the sec­ond half, they’re up 4.

[00:35:44] Tony: 1 per­cent ahead of the pri­or year like for like sales, which is a pret­ty good effort in this kind of envi­ron­ment. Um, so we might start to see, we have in this case with Accent1, we might start to see a re rat­ing of some of the oth­er retail

[00:35:57] Tony: stocks on our buy list for the same rea­son.

[00:35:59] Cameron: Uh, with those, those results, I’m just look­ing at their trad­ing update now, they said that their, um, EBIT is expect­ed to be 109 to 111 mil­lion. Um, And that includes the charge relat­ing to Glue­store. So, get­ting out of Glue­store isn’t real­ly push­ing their rev­enues up in any way. It’s hav­ing the oppo­site effect, right?

[00:36:26] Cameron: So the rev­enues are up despite that charge. The EBIT’s up despite that charge.

[00:36:33] Tony: yeah, so it looks like what hap­pened is the Glue, they’ve ratio­nal­ized the Glue store net­work. So they’ve exit­ed 17 under­per­form­ing stores, but they’ve kept 18 stores which per­form well. So there was a cost asso­ci­at­ed with the exit. Often­times it’s pay­ing out the leas­es or mak­ing staff redun­dant. But going for­ward, it’s a good thing because the stores that are left

[00:36:54] Tony: are prof­itable.

[00:36:55] Cameron: The Glue­store, I’m just look­ing at it now, looks like a, yeah, cloth­ing retail­er.

[00:37:01] Tony: Yes,

[00:37:02] Tony: it’s not where you go

[00:37:03] Tony: for a, if you feel

[00:37:04] Tony: like a sniff.

[00:37:06] Cameron: Yeah, that’s what I assumed. Like, I just had this vision of a shop that just sells glue. I love glue. I love the glue aisle at, uh, Bun­nings. Yeah, do you like the glue aisle at Bun­nings?

[00:37:17] Tony: I can’t say I’ve

[00:37:18] Tony: ever been in the glue

[00:37:19] Cameron: Oh, Chris­sy, Chris­sy knows if I ever go miss­ing at

[00:37:21] Cameron: Bun­nings, she’ll go find me in the glue aisle Glues, super glues, wood glues, tape, lots of dou­ble sided tape, lots of things that, I don’t know, some­thing, isn’t that all, aren’t all men fas­ci­nat­ed by things that’ll stick things togeth­er?

[00:37:38] Cameron: Or is it just me?

[00:37:39] Tony: I know that men are fas­ci­nat­ed by Bun­nings. It’s, it’s a, it’s a,

[00:37:44] Tony: it’s a, yeah, it’s a hon­ey­pot for men.

[00:37:46] Tony: That’s for sure.

[00:37:47] Cameron: Well, I think there’s the thing is I don’t know what any­thing else in Bun­nings actu­al­ly does, but I under­stand glue and tape. That’s about the lim­it of my

[00:37:57] Cameron: hard­ware capa­bil­i­ty. Oh, glue. Yeah. I got a draw­er full of glues. None of them work though. You ever found that? Super­glue? Super­glue in the 70s. You know, they would, in the ads, they’d stick a car to a roof

[00:38:10] Tony: Yeah.

[00:38:11] Cameron: just a lit­tle bit of glue.

[00:38:12] Cameron: I nev­er tried that myself, but I assume it was not lying in adver­tis­ing. I can’t get any­thing to stick these days, you know.

[00:38:21] Tony: assumed it was­n’t lying in

[00:38:22] Tony: adver­tis­ing.

[00:38:22] Cameron: Yeah, well I was,

[00:38:24] Tony: Like, when. the

[00:38:25] Tony: Hoover vac­u­um clean­er would pick up a bowl­ing ball and hold it up

[00:38:28] Tony: in

[00:38:28] Tony: the air. Yeah, right.

[00:38:29] Cameron: I was a kid, it was the 70s, I assume they were telling the truth. Now I buy glue and it’s all shit, none of it ever works.

[00:38:35] Tony: I know super­glue sticks my fin­gers togeth­er.

[00:38:37] Tony: That’s about it.

[00:38:38] Cameron: that’s the only thing it.

[00:38:38] Cameron: sticks togeth­er. I got a hun­dred tubes of glue that I’ve used once and then it was shit. Then I go and find the, the one that’s mar­ket­ed as the extra super strong, you get that, it’s just the same stuff.

[00:38:50] Tony: it comes in two tubes and you have

[00:38:51] Tony: to mix it. And the oth­er The oth­er one which, the oth­er one which I fall foul of all the time is stain removers. Because I’m always like eat­ing, eat­ing din­ner on the couch, watch­ing the golf or some­thing. And then I go, oh, should­n’t I drop the beet­root on the white couch?

[00:39:04] Tony: And then I’ll go, go to the super­mar­ket and buy some stain removers. Does­n’t work

[00:39:09] Tony: at all No,

[00:39:12] Cameron: Uh, all right. So that’s the glue store and AX1. What else you got?

[00:39:17] Tony: What else have I got? I’ve got a pulled pork. I, I do have anoth­er Sto­ry, but I’m going to include it dur­ing the pulled

[00:39:23] Tony: pork,

[00:39:24] Cameron: Who’s your pulled pork, on this

[00:39:26] Cameron: week?

[00:39:27] Tony: Aussie Broad­band. I’m denied about doing a pulled pork on them because they are a Josephine and their share price has come off a bit because they recent­ly, uh, dur­ing con­fes­sion sea­son announced the down­grade.

[00:39:41] Tony: But I also came across, um, an ana­lyst who wrote a suc­cinct, um, good review of them and called them a buy. So I thought it was worth doing a pulled pork on them and includ­ing the

[00:39:52] Tony: ana­lyst’s sto­ry in it.

[00:39:55] Tony: So,

[00:39:55] Cameron: had to, I had to sell them out of a light

[00:39:58] Cameron: port­fo­lio a

[00:39:59] Tony: mm hmm,

[00:40:00] Cameron: week ago when they rule, I had to rule one them cause their

[00:40:03] Cameron: shares have been slip­ping. So any­way, I don’t have to wor­ry about the pulled pork curse. That’s good.

[00:40:08] Tony: you got ahead of it. Yeah, well, you per­haps sold at a high­er price too. Um, yeah, so it’s a Josephine at the moment and, um, It’s, but it could be a future buy what your sen­ti­ment returns, and I sus­pect it might, and so does this ana­lyst, um, it, it had a sharp fall on its share price and prob­a­bly the main rea­son for it was there was a, uh, a loss of, uh, a white label busi­ness that they, um, have for ori­gin ener­gy.

[00:40:36] Tony: So this com­pa­ny is a an MBM resell. to both retail and com­mer­cial cus­tomers, but it also white labels broad­band ser­vices for resale by oth­er com­pa­nies, in this case Ori­gin Ener­gy. And, uh, so it’s been a thing in banks and util­i­ties and super­mar­kets that they’ve been able to sell things to their cus­tomer base under their own brand, which aren’t nec­es­sar­i­ly part of their nor­mal prod­uct suite.

[00:41:06] Tony: And that’s, that’s why, um, The Ori­gin Ener­gy offered NBN pack­age, which Aussie sup­port­ed, was a mate­r­i­al part of their busi­ness. And when it lost it, they had to come out with a down­grade. Um, but I’ll get to that lat­er. Um, bit of, a bit more about ABB. It’s, um, I guess it’s what the name says. It’s an Aus­tralian based broad­band.

[00:41:30] Tony: Um, they claim they have very high cus­tomer ser­vice rat­ings and they make a big deal out of run­ning Aus­tralian based call cen­tres and they say that’s one of the rea­sons why they do so well. Uh, they’ve been oper­at­ing for 20 years and began life in West­ern Vic­to­ria when a com­pa­ny called West Vic Broad­band and Wide­band Net­works were formed.

[00:41:52] Tony: The com­pa­ny is still based in Mor­well, Vic­to­ria, which is kind of a strange place for a nation­al com­pa­ny to be based, but I guess it has his­toric roots. to Rur­al Vic­to­ria. They also have a one foot in Bris­bane as well. So in 2007, a Bris­bane based com­pa­ny called Over the Wire Net­work start­ed and Over the Wire would lat­er merge with ABB.

[00:42:16] Tony: Uh, going through its his­to­ry in 2008, west Broad­band, west Vic Broad­band and Wide­band Net­works merged to form Aussie Broad­band. Um, back then, this is in the pre MBN days, they offered a DSL voiceover IP and web­site host­ing ser­vices. In 2009, the, the fed­er­al gov­ern­ment announced the NB. Nation­al Broad­band Net­work would roll out.

[00:42:39] Tony: And in 2013, ABB joined, uh, to the MBN point of inter­con­nect, the POI, in region­al Vic­to­ria and con­nect­ed their first cus­tomer to the MBN. By 2014, um, over the wire, the com­pa­ny from Bris­bane had list­ed on the AXS sep­a­rate­ly. And in 2016, ABB con­nect­ed to all of the nation­al, uh, Point of inter­con­nects POIs on the MB nm.

[00:43:05] Tony: By 2019 A B. B had con­nect­ed a hun­dred thou­sand cus­tomers to the MBM in 2020 A, BB list­ed on the A SX and racked up 400,000 cus­tomers by 2021 in 2022 A, BB merged with uh, OTW. And all the founders for these lega­cy cus­tomers remain on the board today. So that’s, um, I should­n’t say all the major­i­ty of them that I could see have.

[00:43:31] Tony: But there’s been a bit of a tumul­tuous recent his­to­ry for ABB. As I said before, they white labeled MBM prod­ucts to Ori­gin, who unsold them to their cus­tomers. How­ev­er, ear­li­er this year, Ori­gin noti­fied that they were mov­ing the white label busi­ness away from ABB. That busi­ness even­tu­al­ly went to a com­peti­tor called Super­loop, also list­ed on the ASX.

[00:43:51] Tony: Around this time, ABB launched a raid on Super­loop, who are one of their com­peti­tors, and amassed a 19. 9 per­cent stake. They lat­er claimed that this was done before their knowl­edge that the Ori­gin con­tract had gone to Super­loop occurred, and I stress that they are not accused of any form of insid­er trad­ing.

[00:44:10] Tony: How­ev­er, the saga con­tin­ued, and in March, Super­loop noti­fied ABB that they would require the approval of the Sin­ga­pore­an gov­ern­ment to allow any­one to acquire more than 12 per­cent of the com­pa­ny. ABB fought this, but even­tu­al­ly sold its stake in Super­loop. or reduced at stake, down to below 12%. These shares were sold at a prof­it due to the fact that Super­loop had won the Ori­gin con­tract.

[00:44:34] Tony: So, not all a bad thing, but did­n’t achieve what ABB set out to do. Dur­ing the recent con­fes­sion sea­son, how­ev­er, ABB released a down­grade due to the loss of the Ori­gin busi­ness, and also ABB’s deci­sion to help fill the loss of cus­tomers by launch­ing a new low­er cost brand called Bud­dy. The launch does­n’t come cheap, And the prof­it down­grade con­tains launch costs for the new brand.

[00:45:00] Tony: So now I’m going to read from, uh, the Intel­li­gent Investor, chap by the name of Gau­rav Sod­hi, he’s the ana­lyst. And, uh, the head­line is Aussie finds a bud­dy. So this ana­lyst’s first reac­tion to Aussie broad­band’s, uh, Logo, sor­ry, I’ll skip that. Um, Aussie’s share price fin­ished the day down 16 per­cent after it announced the launch and pro­vid­ed an oper­at­ing update.

[00:45:27] Tony: Uh, the launch was to Bud­dy. That update showed the busi­ness was grow­ing to plan. The busi­ness had added almost 85, 000 new broad­band con­nec­tions, about 75 per­cent of which came from the res­i­den­tial broad­band base. The loss of the Ori­gin con­tract will hurt. With about 145, 000 cus­tomers rolling off the net­work in the ear­ly months of the new finan­cial year.

[00:45:51] Tony: We think that loss will equate to about 20 mil­lion in oper­at­ing prof­it. Of course, it won’t show up in the num­bers that Aussie will report in August. Those num­bers were con­firmed to be between 116 to 121 mil­lion in EBITDA. Aussie guid­ed to EBITDA of 125 to 135 mil­lion in FY25, but that was low­er than the 150 mil­lion they had expect­ed, we had expect­ed a few months ago, and judg­ing by the mar­ket’s reac­tion, this ana­lyst was­n’t alone.

[00:46:20] Tony: Yet that num­ber includes the loss of the Ori­gin con­tract and an addi­tion­al 10 mil­lion in spend­ing on launch­ing the new brand called Bud­dy. The Aussie broad­band brand is a pre­mi­um one, attract­ing high vol­ume users, About 40 per­cent of res­i­den­tial cus­tomers opt for top tier speeds, about twice as many as the NBN aver­age.

[00:46:41] Tony: This has meant that Aussie has col­lect­ed high val­ue prof­itable cus­tomers but neglect­ed about 2 mil­lion house­holds who opt for low­er cost plans. The plan is to tar­get those cus­tomers with Bud­dy. The ser­vice will launch at much low­er prices in Aussie and will offer low­er ser­vice lev­els. Rather than an expen­sive local call cen­ter that solves almost any broad­band prob­lem, regard­less of how long it takes, Bud­dy will be run with a chat­bot and offer lim­it­ed sup­port.

[00:47:07] Tony: It will, how­ev­er, use Aussie’s net­work and tech­nol­o­gy stack, which we think is the best in the indus­try. A senior man­ag­er at a large com­peti­tor con­fid­ed the changes that take him six weeks to imple­ment hap­pen with­in min­utes at Aussie because of their auto­mat­ed tech­nol­o­gy stack, and that will help to keep costs low.

[00:47:25] Tony: Uh, it goes on, uh, fur­ther on, but, um, I’ll just fin­ish off. With a val­u­a­tion now cheap­er than at any time dur­ing its list­ed life and cus­tomer growth still in dou­ble dig­its, it’s time to upgrade this com­pa­ny to a buy. So I think that was a pret­ty good, um, analy­sis of the com­pa­ny and what’s hap­pened recent­ly and what it’s doing.

[00:47:50] Tony: Um, so now for the num­bers from the QAV buy list. The share price for this analy­sis is 3. 11. That was on, the down­load was done on the week­end, how­ev­er I think today it’s 3. So, the price still is declin­ing. How­ev­er, giv­en the analy­sis we’ve just seen, with cus­tomer num­bers ris­ing still, maybe that will turn around, the price will turn around.

[00:48:15] Tony: This is a high ADT com­pa­ny, with 2. 2 mil­lion trad­ed on aver­age every day. So that’s a good thing for our lis­ten­ers. The mar­ket cap sits just below a bil­lion dol­lars but has fall­en recent­ly from above a bil­lion dol­lars. Earn­ings per share fore­cast has been low­ered from about 0. 20 per share to 0. 155 per share fol­low­ing the con­ces­sion sea­son down­grade, and that’s cor­re­spond­ed in the share price low­er­ing quick­ly.

[00:48:42] Tony: The price now sits below con­sen­sus fore­cast by some 20%, how­ev­er. Uh, there is no div­i­dend yield, so we can’t score it for that. And this com­pa­ny is gen­er­al­ly seen as being a growth com­pa­ny, at least up until recent­ly. Stock Doc­tor finan­cial health is strong and the trend is steady. The PE sits at 18. 6 times, which is the low­est in the last three years.

[00:49:03] Tony: Um, but it is high, as I say, it’s because the com­pa­ny is gen­er­al­ly seen as a growth com­pa­ny. Prop­Caf is 6. 99, which just makes it onto the buy list. Um, and it’s large­ly dri­ven by the reduc­tion in share price that gets it to 6. Stock price is well above IV1 and IV2, which are 56 respec­tive­ly. We can’t also buy this com­pa­ny for book price or book plus 30%.

[00:49:30] Tony: Net equi­ty per share is 1. 49, which is mate­ri­al­ly above, um, mate­ri­al­ly below the share price and a lot above the NTA, net tan­gi­ble asset val­ue of 0. 17, sug­gest­ing that there’s been a lot of good­will incor­po­rat­ed to the bal­ance sheet due to pri­or acqui­si­tions and merg­ers. Thank you very much. Stock Doc­tor shows EPS fore­cast growth at 51 per­cent in the lat­est down­load, but I’m not con­vinced this is tak­ing into account the recent down­grade, so that may change in the next, in the com­ing days.

[00:50:01] Tony: Direc­tors hold 10 per­cent of the stock, and var­i­ous founders of the orig­i­nal com­pa­nies remain on the board, which is a good sign. Equi­ty has con­sis­tent­ly increased strong­ly, uh, but that may come to an end with the recent announce­ments. We won’t see that Prob­a­bly in this lat­est results, they may come through in the six month­ly, um, in March.

[00:50:21] Tony: ABB gets 14 out of 15 or 93 per­cent for qual­i­ty and a QAV score of 0. 13. And it’s new on the buy list this, uh, this week. There are some risks as we’ve seen, um, The white label busi­ness, obvi­ous­ly. Uh, I think the biggest risk at the moment is attached to the launch of the new brand Bud­dy. It may work, and man­age­ment cer­tain­ly know what they’re doing, but it may also require more cash injec­tions to estab­lish it.

[00:50:47] Tony: Uh, there may also be fur­ther cor­po­rate acqui­si­tion activ­i­ty with Super­loop or with oth­er small­er tel­cos, uh, which can dri­ve the share price. Um, I like the expe­ri­ence of the direc­tors who have skin in the game, and have been around for a long time, and I agree with the Intel­li­gent Investor Ana­lyst who thinks the com­pa­ny will bounce back from the loss of the Ori­gin Con­flict.

[00:51:09] Tony: So that’s ABB.

[00:51:11] Cameron: So keep an eye on it, but it’s down­trend.

[00:51:15] Tony: Cor­rect. Yep.

[00:51:18] Cameron: Thank you, Tony.

[00:51:20] Cameron: Yeah. We’ve had to talk about them a bit in recent times, haven’t we?

[00:51:24] Tony: Yeah, we have.

[00:51:25] Cameron: Hmm.

[00:51:26] Tony: cer­tain­ly, um, made the back page of the Fin Review a lot back in about March or April with their attempt­ed, um, share, well, with their share raids on

[00:51:35] Tony: Super­loop. Made for inter­est­ing read­ing.

[00:51:39] Cameron: While I think of it, I’m gonna give my ISPA plug again, LTEL, A‑L-A-U-N-T-E‑L. If you’re look­ing for an ISP, I’m not get­ting paid for this unfor­tu­nate­ly, but check ’em out. They’re based in Launce­s­ton or Inver May. Actu­al­ly, I start­ed using them. I, no, prob­a­bly 6, 7, 8 months ago I’d been with. Intern­ode For­ev­er.

[00:52:04] Cameron: I was get­ting about 150 megabit down­load on intern­ode. Always hav­ing prob­lems though. It was always drop­ping down to like 20, 30 and it was just real­ly flaky and you con­tact their tech sup­port and they’re like, have you tried turn­ing it off and on? I’m like, screw you dude. Like I’ve been in the inter­net indus­try since before you were born.

[00:52:24] Cameron: Don’t play me like that. Any­way, I was, um, I think on Red­dit or some­where, some­body sug­gest­ed Lawn Tow­ers. So I. migrat­ed over with­in, and I’m not lying, two min­utes of fill­ing out their form, they’d switched the con­nec­tion over and I was get­ting 500 megabits a sec­ond. No equip­ment changes, no fiber changes, noth­ing.

[00:52:46] Cameron: And then that ran for like six months. And then I got an email from them a cou­ple of weeks ago when I was in Bund­aberg say­ing, Oh, that plan that you’re on. Uh, we’re get­ting rid of that plan, um, and we’re replac­ing it with anoth­er plan, basi­cal­ly the same price, but Neo now on a thou­sand megabits a sec­ond.

[00:53:06] Tony: Yeah,

[00:53:07] Cameron: I was like, max­i­mum of a thou­sand, so I get about six to sev­en hun­dred and fifty megabits a sec­ond. Again, no, no equip­ment changes, noth­ing. My speed’s gone up, you know, six or sev­en times, um, for no extra cost. But the rea­son I was going to give them a plug is, um, a week or so ago, I was sit­ting here late one night and the TV was­n’t work­ing, you know, the stream­ing thing was­n’t work­ing, and I did a speed check and it was down to like thir­ty.

[00:53:36] Cameron: Megabits a sec­ond. And so I slayed at night, it was like 10 o’clock at night, and I jumped on Twit­ter and I shot them an email and did­n’t hear any­thing back until the next morn­ing when one of their tech guys said, Hey, Cameron, sor­ry, we, um, I just checked the logs and there was some real­ly weird traf­fic spike that hap­pened last night.

[00:53:55] Cameron: We haven’t quite fig­ured out why, but it sort of crashed every­thing in your area. How was it this morn­ing? I said, Yeah, it’s all good. He said, great. And then he sent me anoth­er email, like yes­ter­day, uh, sort of a few days lat­er, say­ing, Hey, just check­ing in. You seen any more spikes? I’ve checked the stats in your area.

[00:54:13] Cameron: I haven’t seen any­thing since that spike last week. Is it all good? And I was like, yeah, it’s as far as I know, but thanks. Love your work. And then he’s like, yep, no wor­ries. So out of the blue, like their tech sup­port peo­ple are sen­sa­tion­al. Their sup­port game is first class. Just, um, always fol­low­ing up real­ly quick, real­ly friend­ly.

[00:54:32] Cameron: Um, yeah, so I can’t speak high­ly enough of Laun­tel.

[00:54:38] Tony: It’s inter­est­ing they’re based in Launce­s­ton and the ABB’s based in Mor­well because I remem­ber going way back, um, I can’t remem­ber how I came across these guys, but I came across, I think at that stage there was two guys, they were man­agers and they were work­ing for one of the air­lines and they had, um, set up a, I think, Large call cen­tre, I think it was in Launce­s­ton, and they were fight­ing against the out­sourc­ing.

[00:55:05] Tony: Um, of call cen­ters over­seas, and they had proved that, uh, even though the hourly rate for the work­ers was more expen­sive in Tas­ma­nia, um, every oth­er met­ric, includ­ing sat­is­fac­tion and pro­duc­tiv­i­ty and sales, was high­er than an over­seas call cen­ter, because the peo­ple in the law sys­tem, um, had very low churn, they all want­ed the job, they all cared about what they were doing.

[00:55:31] Tony: Um, there was a ready made mar­ket of, uh, peo­ple who would oth­er­wise prob­a­bly have been unem­ployed. Uh, and, um, yeah, they kind of opened my eyes to that whole sit­u­a­tion. And it was some­thing I’d used at Myer Direct when we were based in Roeville. Uh, we had a ready made mar­ket of peo­ple to work on the call cen­ters then.

[00:55:51] Tony: We had a large call cen­ter that we were run­ning. And then I came across them again. I think some­how they’d got­ten into Tel­stra and Tel­stra had employed them to set up. Call cen­tres for them. So, yeah, I won­der if that’s the secret of the suc­cess of Laun­tel and with ABB is being in a rur­al area and hav­ing an Aus­tralian call cen­tre based busi­ness where there’s low churn, even though it’s a high­er oper­at­ing cost,

[00:56:15] Tony: it does pro­vide bet­ter busi­ness ser­vice.

[00:56:19] Cameron: Well, cus­tomer ser­vice

[00:56:20] Cameron: is, you know, hard to come by, uh, good cus­tomer ser­vice. And, um, you know, when you, when you find a

[00:56:27] Cameron: com­pa­ny that pro­vides that, I

[00:56:30] Cameron: think, you you know, you’re will­ing to pro­vide them with a lot more, um, I don’t know, flex­i­bil­i­ty, ben­e­fit of the doubt. Um, you’ll tol­er­ate a lot. The oth­er sto­ry I got to tell you is Chris­sy last week.

[00:56:42] Cameron: She was drop­ping Fox off at school, dropped her iPhone on the pave­ment, face down, picked it up, the screen pro­tec­tor was all cracked, but the screen was okay, but it was just all yel­low. She could­n’t get it to do any­thing, it was just like straight, just a block yel­low. So she came home and gave me a look at it, I reboot­ed it, still all yel­low, so she made an Apple Genius appoint­ment for that day, um, took it in, And the phone, we’d had the phone for near­ly three years, so well out of war­ran­ty peri­od, and they looked at it and they said, you know what?

[00:57:22] Cameron: It’s in real­ly good nick. Apart from that, we’ll just give you a new one. So they just replaced her phone. She walked out 10, 15 min­utes lat­er with not a brand new phone, but a replace­ment of that. So 13 Pro Max or what­ev­er, um, with a new two year war­ran­ty. Just, yeah, look. You know, he said it’s only six months out of war­ran­ty.

[00:57:45] Cameron: She said, well, it’s nine months real­ly. I guess six, nine, you know. No, I fig­ure they, they, they prob­a­bly got some of these phones sit­ting on stock that, you know, they’re two, three year old phones. They’re prob­a­bly not sell­ing. So there’s prob­a­bly eco­nom­ics or what­ev­er in there and jus­ti­fi­ca­tions for doing it.

[00:58:02] Cameron: They might’ve been told, you know, just get rid of these things, what­ev­er. I don’t know. But. She was like, thought it was going to cost us 600 bucks for a new screen. She walked out with a new phone. I mean, that lev­el of cus­tomer sup­port, like you’re not get­ting that from many busi­ness­es in

[00:58:19] Tony: That’s amaz­ing. Did­n’t, it did­n’t like, he did­n’t come away with his phone num­ber at the top of the con­tact list or some­thing like that. I won­der if I get the same ser­vice if I went in

[00:58:29] Tony: with a cracked phone.

[00:58:31] Cameron: Prob­a­bly, you know, might’ve had, I also think we, um, A cou­ple of days ear­li­er, um, or maybe the day before actu­al­ly, uh, I took her to the Apple store for a Vision Pro demo. I was pick­ing up my lap­top, it was get­ting fixed, and, um, I booked her a Vision Pro, well, she booked a Vision Pro demo on my sug­ges­tion.

[00:58:52] Cameron: So, maybe they thought, ooh, she and her hus­band are both in for Vision Pro demos, maybe we’ll sell them a sev­en and a half thou­sand, two sev­en and a half thou­sand dol­lar head­sets if we keep them hap­py. I don’t know. But, um. Any­way, it’s just real­ly impres­sive cus­tomer ser­vice from both Laun­tel and, um, Apple in the last week.

[00:59:14] Tony: Well done.

[00:59:15] Cameron: She deserves a men­tion.

[00:59:17] Cameron: Alright, well, thank you for ABB,

[00:59:19] Cameron: Tony. that’s it. After hours, Tony. Hors­es? How are the hors­es

[00:59:23] Cameron: doing?

[00:59:24] Tony: Well, I haven’t had much horse activ­i­ty. They’re all in train­ing at the moment, but, um, noth­ing run­ning. I did wan­na call out. We should, and we should per­haps try and get him on the show. Chris Bach­e­lor, who used to be one of the prin­ci­pals in scaf­fold with Roger Mont­gomery, I came across him. I was doing my, um, online learn­ing for our autho­rized rep­re­sen­ta­tive.

[00:59:44] Tony: License, um, and he wrote a mod­ule about share buy­backs, and it’s often a ques­tion we get at, um, in, uh, we get a ques­tion on QAV from, uh, our lis­ten­ers about share buy­backs, and it was actu­al­ly a real­ly good mod­ule, so, um, I might try and reach out to him and get him on for an inter­view about share buy­backs and the, and the ins and outs

[01:00:05] Tony: and legal­i­ties and intri­ca­cies of it.

[01:00:07] Cameron: We have had Chris on the show, haven’t we?

[01:00:11] Tony: Pos­si­bly, is he now in

[01:00:12] Tony: Stock­o­pe­dia?

[01:00:14] Cameron: Yeah.

[01:00:15] Tony: Okay, well, there you go.

[01:00:16] Cameron: I’m just I’m just con­firm­ing. Yeah, he’s at Stock­o­pe­dia

[01:00:19] Cameron: now. Yeah,

[01:00:20] Tony: right,

[01:00:20] Tony: there

[01:00:21] Tony: we go.

[01:00:22] Cameron: I’m pret­ty sure we had him on to talk

[01:00:24] Cameron: about Stock­o­pe­dia a while back, because

[01:00:25] Tony: what he did,

[01:00:27] Cameron: yeah,

[01:00:28] Tony: or we should get him back to talk about share buy­backs because he did a real­ly good job,

[01:00:32] Tony: um, on the Autho­rized Rep Learn­ing

[01:00:34] Tony: site.

[01:00:36] Cameron: Okay. Share buy­backs. And, uh, we’re doing a thing for them in a cou­ple of weeks.

[01:00:43] Tony: are, yeah, We can talk to him then if you like.

[01:00:47] Cameron: yeah. Share buy­backs.

[01:00:52] Tony: after hours, um, Alex gave me a few good tips. Uh, she went to a Brace Cum­mins con­cert. Have you heard of her at all?

[01:01:00] Cameron: I don’t think so, no.

[01:01:01] Tony: I think she’s a young singer in Mel­bourne, so you prob­a­bly haven’t. Um, Alex’s com­ment was, uh, I want­ed to go and see her at the SV before she got big. It might be too hard to get tick­ets.

[01:01:10] Tony: So, um, I’ve been lis­ten­ing to her. It’s prob­a­bly not my cup of tea, but, um, any­body who likes sort of, uh, the per­son she remind­ed me of was Joni Mitchell, any­one who likes sort of female. folk singers. Um, it’s that kind of style. But the oth­er one which I’m enjoy­ing is um, Alex gave me a link to the uh, the site’s called stitch­esin­time.

[01:01:30] Tony: me. So stitch­es in time slash watch slash one. But it’s basi­cal­ly some­one has Tak­en every­thing that’s ever been broad­cast about Dr. Who and put it in chrono­log­i­cal order. So like if the doc­tor went back to pre­his­toric times, that’s in the, in the right order with the oth­er de anoth­er episode that went back in pre­his­toric times.

[01:01:56] Tony: Or if there was a radio play, it set in pre­his­toric times that gets wedged in as well. So it’s, it’s quite, it’s quite fun to watch. It’s a bit of a mind. Mind­fuck when you go through and look at all the dif­fer­ent, it jumps between dif­fer­ent doc­tors quick­ly and assis­tants and all the rest, but it’s, it’s, um, real­ly inter­est­ing and a lot

[01:02:14] Tony: of fun.

[01:02:16] Cameron: Wow. I bet you a lot of it takes place in, like, 19th cen­tu­ry Lon­don.

[01:02:22] Tony: Yeah, Vic­to­ri­an

[01:02:23] Tony: era. Yeah.

[01:02:24] Tony: I haven’t got that far yet, but

[01:02:26] Tony: yes.

[01:02:26] Cameron: yeah, two thirds of it’s just in Vic­to­ri­an Lon­don. Yeah,

[01:02:30] Tony: yeah. Uh, and also I want a big shout out to Alex, I don’t think she’s lis­ten­ing, but if she does, she’s a final­ist for the Mos­man Emerg­ing Artist Art Prize, run by the Mos­man City Coun­cil up here,

[01:02:42] Cameron: Right.

[01:02:43] Tony: is being drawn in a cou­ple of weeks

[01:02:45] Tony: on a Fri­day night, so we’ll go along and look

[01:02:47] Tony: at

[01:02:47] Tony: that.

[01:02:48] Tony: Yeah,

[01:02:48] Cameron: you know how she end­ed up in that? Did she sub­mit some­thing

[01:02:52] Tony: yeah, there’s, there’s lots of art prizes, and I’ve encour­aged her to suss out the ones she thinks she might have a chance at, and so she sub­mit­ted, I think, to three at the moment, and this one has put her on the short list.

[01:03:04] Cameron: Fan­tas­tic. Con­grat­u­la­tions, Daleks.

[01:03:06] Tony: Yeah, that’s pret­ty much it. I’ve had fun watch­ing US pol­i­tics over the week­end and my, my favourite head­line was Don­ald Duck.

[01:03:19] Cameron: Yes,

[01:03:22] Tony: great to see George Clooney run­ning the Democ­rats and call­ing the shots now. He, he came out Sat­ur­day night and said that Biden

[01:03:28] Tony: should step down and by Sun­day he was gone.

[01:03:31] Tony: So, yeah,

[01:03:33] Cameron: well maybe he should run,

[01:03:35] Cameron: they might have a chance against Trump if Clooney runs against him.

[01:03:39] Tony: I don’t know. He’s, um, he’s a polar­iz­ing fig­ure. I remem­ber when I was in Cana­da, I had some Amer­i­can

[01:03:45] Tony: friends who hat­ed him because he was seen as being a Demo­c­rat. a

[01:03:49] Cameron: Well the left­ies, I mean the right won’t vote for him but he might get the left­ies to

[01:03:52] Cameron: get out and

[01:03:54] Tony: Oh, I’ll get out and vote for

[01:03:55] Tony: Kamala. if she gets it, she’s got to get through the con­fer­ence. yeah learn­ing.

[01:04:03] Cameron: You know, Biden up until, you know, the week­end say­ing there was no way he was not run­ning and only if the Lord Almighty him­self came and told him not to do it.

[01:04:14] Cameron: And, you know, yeah, clear­ly, appar­ent­ly. Well, appar­ent­ly it sounds like Pelosi and Oba­ma. Sort of told him he had to pull out. But he did­n’t say that when he was inter­viewed a cou­ple of weeks ago. If he’d said, well, lis­ten, you know, if the, uh, head hon­chos of the Demo­c­ra­t­ic Par­ty all come and con­vince me that I’m not the right per­son, then sure, I’ll step down.

[01:04:37] Cameron: But no, no, no, he’s

[01:04:38] Tony: can’t do

[01:04:39] Tony: that though, can he? It’s like a CEO of a com­pa­ny. I’ve got the back­ing of the board. Just keep say­ing I’ve got the back­ing of the board, even if you’re in mid­night nego­ti­a­tions for your future. He keeps, oth­er­wise you’re a lame duck. You can’t do it that way. I lis­tened to the Amer­i­C­ast pod­cast, which is the BBC reporters who cov­er Amer­i­can pol­i­tics, and one of them said that it was on the week­end that, uh, their sources were telling them that Biden final­ly got to see the poll num­bers, he is, like he’s had been hid­ing them or not show­ing him the cor­rect num­bers, and that had been one of the con­vinc­ing fac­tors as well.

[01:05:18] Tony: But as soon as, as soon as Biden came down with COVID, I said to Jen­ny,

[01:05:21] Tony: that’s it, he’s gone. It’s a cov­er.

[01:05:23] Cameron: Yeah. Yeah, yeah, yeah. You know, I won­dered if the COVID was a cov­er for him just, yeah, stay­ing at

[01:05:29] Tony: Take a breather.

[01:05:30] Cameron: out his exit strat­e­gy.

[01:05:32] Tony: Cor­rect. Step back, talk to every­one and announce a

[01:05:35] Tony: step down.

[01:05:36] Cameron: But it’s, this is the thing that gets me though, like, so for quite a few years now, since, you know, his last run against Trump in 2019, 2020, you know, there were lots of sto­ries about the fact that his men­tal acu­ity was­n’t what it was. A lot of

[01:05:55] Tony: Yeah.

[01:05:56] Cameron: in the, in the, nom­i­na­tion process. A lot of his, uh, um, oth­er can­di­date wannabes were high­light­ing the fact that he was los­ing his mem­o­ry and los­ing his abil­i­ty to speak and all of that kind of stuff.

[01:06:09] Cameron: Uh, and then when he became the nom­i­nee, when the par­ty basi­cal­ly forced him down every­one’s throat, they all ral­lied around and said, Oh no, he’s great. And as Glenn Green­wald has been point­ing out on his pod­cast for the last few weeks, right up until. Days before the last, before his debate with Trump, there were peo­ple, not just in the Demo­c­ra­t­ic par­ty and the, the rank and file and his advi­sors, but even jour­nal­ists like Joe Scar­bor­ough from Morn­ing Joe, absolute­ly swear­ing black and blue that they’ve spent time with Biden, that he was sharp as ever, 100 per­cent old Biden, all great.

[01:06:50] Cameron: And then of course the debate hap­pened and it was obvi­ous that he was­n’t all there, at least on that par­tic­u­lar night he was not able to cope. And then all of those guys like Joe Scar­bor­ough did a, you know, dou­ble take or did a 180 overnight and said, Oh yeah, he needs to drop out. He’s not the man he used to be.

[01:07:09] Cameron: Where­as they’d been say­ing for like right up until the night before that he was sharp as ever and they per­son­al­ly had spent time with him and he was in killer form. It’s just, the medi­a’s lying, the par­ty’s lying, every­one’s lying, and then they’re like, but we’re the good guys. Don­ald Trump’s, Don­ald Trump’s a liar and a bad guy.

[01:07:31] Cameron: Where they go, go, well, hold on. You have no cred­i­bil­i­ty. None of you have, why should

[01:07:35] Tony: I don’t know why you’re shocked by

[01:07:37] Tony: that, Cameron.

[01:07:38] Cameron: I’m not shocked

[01:07:39] Cameron: but it’s the fact that they get away with it, that no one calls them, like JD Vance say­ing, you know, Trump was Hitler, now is his veep.

[01:07:50] Cameron: Tuck­er Carl­son get­ting up at the Repub­li­can Nation­al Con­ven­tion over the week­end and say­ing Trump was the great­est guy on earth, where he got fired from Fox News when his emails and text mes­sages were leaked say­ing that, thank God we don’t need to talk about him any­more, he’s, he’s, he’s, what­ev­er he said, I can’t remem­ber, but it was not com­pli­men­ta­ry of Trump.

[01:08:08] Cameron: And he, you know, said that he’d been so sick of, you know, hat­ed hav­ing to prompt him up for the last cou­ple of years. So, Glad to see the back of him for­ev­er and all that kind of stuff. But no one, like, it’s just, no one calls them on their hypocrisy, whether it’s in the media or it’s the politi­cians or the par­ty offi­cials, they don’t get called on it.

[01:08:26] Cameron: It’s

[01:08:26] Tony: Well, they do. I’ve been read­ing arti­cles about JD Vance flip flop­ping and how Peter Thiel took him to Mar a Lago and he met with Trump and there was a big stack of papers that Trump had print­ed out where JD Vance had been crit­i­cal of him and Vance was, you know apolo­getic and kissed the ring and now he’s the VP so it gets report­ed it’s just that it

[01:08:46] Tony: gets gets washed away in the tide of what­ev­er else is

[01:08:49] Tony: going on.

[01:08:50] Cameron: Yeah, I mean the Democ­rats report on the Repub­li­cans, the Repub­li­cans report on the Democ­rats, but for their own peo­ple, they just turn a blind eye and, you know,

[01:08:59] Tony: of course. Yeah, no, I

[01:09:01] Tony: agree.

[01:09:01] Cameron: But, but, it’s just no won­der

[01:09:04] Cameron: that, you know, there’s just a lack of trust in the sys­tem and the politi­cians.

[01:09:08] Tony: Well, it’s a shame it, it’s par­tic­u­lar­ly hap­pen­ing in the US but it’s hap­pen­ing here now too, that the medi­a’s become par­ti­san. It’s not news any­more. It’s not impar­tial­ly report­ed gen­er­al­ly, it’s it’s par­ti­san. It’s it’s edi­to­r­i­al, it’s it’s opin­ion. It, you should­n’t call the news any­more. You just call it the.

[01:09:27] Cameron: Yeah.

[01:09:29] Tony: And, uh, it’s a shame. Speak­ing, uh, did you hear the meme or sto­ry from J. D. Vance at the, um, Repub­li­can con­ven­tion?

[01:09:38] Cameron: Uh,

[01:09:39] Tony: loaded hand­guns?

[01:09:41] Cameron: No.

[01:09:42] Tony: Oh, this, I could­n’t, I could­n’t believe it when I heard it and it made me laugh. But, um, this is after, you know, assas­si­na­tion attempt. When you’d think that they’d be say­ing, maybe we’ve got too many guns.

[01:09:55] Tony: He gets up on stage, and I’m going to quote it. He says, um, let me tell you anoth­er meme, he calls it Mamaw sto­ry. He says, um, let me tell you anoth­er meme, he calls it Mamaw sto­ry. Now my mamo died short­ly before I left for Iraq in 2005. And when we went through her things, we found 19 loaded hand­guns.

[01:10:10] Tony: Now the thing is they were stashed all over her house, under the bed, in the clos­et, in the sil­ver­ware draw­er, and we under what? What We won­dered what was going on. And it occurred to us that towards the end of her life, Mamaw could­n’t get around so well. And so this frail old woman made sure that no mat­ter where she was, she was with­in arm’s length of what­ev­er she need­ed to pro­tect her fam­i­ly with.

[01:10:31] Tony: That’s who we fight for, that’s Amer­i­can

[01:10:32] Tony: spir­it. And the crowd erupt­ed. And I’m like, don’t you know that your pres­i­den­tial can­di­date was almost shot to death a cou­ple of days before?

[01:10:44] Cameron: Almost shot.

[01:10:46] Tony: and they’re cheer­ing for this guy’s grand­moth­er who had 19

[01:10:50] Tony: guns stashed around

[01:10:51] Tony: the house.

[01:10:52] Cameron: One of the things that Glenn Green­wald’s been point­ing out though about the RNC is the diver­si­ty of views from the speak­ers on stage. He was like, yeah. He said it’s all over the place. He said you had like, um, Tuck­er Carl­son. and I think Vance him­self that are real­ly anti sup­port­ing the war in Ukraine.

[01:11:15] Cameron: Tuck­er Carl­son got, he played a clip of Tuck­er Carl­son get­ting up and say­ing, you know, the US pro­voked, Biden pro­voked Putin into invad­ing Ukraine, which I agree with, Glenn Green­wald agrees with, John Mearsheimer agrees with, delib­er­ate provo­ca­tion to lead him into a drawn out, unwinnable war. Um, but then they’d have anoth­er speak­er get up.

[01:11:39] Cameron: imme­di­ate­ly after him and be all pump­ing up Amer­i­ca and fight­ing the war and destroy­ing Putin. And he said it was, he said, it’s like, there’s no con­sis­ten­cy. And he was kind of ask­ing the ques­tion, like, is this a good thing? Like that in a Trump Repub­li­can par­ty that you don’t have to tow the line, you can get up and just speak your mind.

[01:12:01] Cameron: But he was also play­ing, the audi­ence was cheer­ing. Regard­less of what any­one said, one speak­er says, yeah, we got to pros­e­cute the war in Ukraine. They’re all cheer­ing. He says, no, we should pull out of Ukraine. They’re all cheer­ing. It’s whether

[01:12:15] Tony: Well, there is no, there is no, Trump does­n’t have a pol­i­cy.

[01:12:18] Tony: He’ll say one thing one day and some­thing else anoth­er day.

[01:12:21] Tony: So yeah, That’s it.

[01:12:22] Cameron: yeah, he’s just audi­tion­ing to see which gets the most applause and what he might say next, you know?

[01:12:27] Tony: Yeah.

[01:12:27] Tony: it’s an evo­lu­tion­ary growth

[01:12:28] Tony: algo­rithm. So let’s just

[01:12:30] Cameron: Yeah. Yeah. Yeah.

[01:12:32] Tony: I think it’s great, though, that, um, that Trump is the new Gough Whit­lam. He’s going to bring home the troops. He’s going to put up tar­iffs. He’s going to sup­port local indus­try, local resources, make the U. S. self suf­fi­cient with oil.

[01:12:46] Tony: Uh, he’s going to sup­port the work­ing per­son. Um, can I, can I stop immi­gra­tion? You could hold Goff Whit­lam’s 72 pol­i­cy agen­da beside the Trump agen­da. And it’s almost line by line

[01:12:59] Tony: the same.

[01:13:00] Cameron: Pre uni­ver­si­ty. Bring in

[01:13:03] Tony: Eh, maybe not that.

[01:13:07] Cameron: Yeah,

[01:13:08] Tony: Trump’s run­ning a, like a.

[01:13:10] Tony: You know, 70s style social­ist

[01:13:12] Tony: agen­da.

[01:13:13] Cameron: there’s

[01:13:14] Cameron: the oth­er point Green­wald made is he ran on that in 2016, too, and then real­ly did none of it. He said, you know,

[01:13:22] Tony: Yeah, it’s just all bull­shit.

[01:13:23] Tony: Yeah.

[01:13:24] Cameron: yeah, yeah, yeah. Goff actu­al­ly did it.

[01:13:26] Tony: Yeah.

[01:13:27] Tony: true.

[01:13:29] Cameron: Well, he was say­ing that, you know, that Trump ran on that anti war, you know, sort of, Pulling away from NATO, et cetera, et cetera. Um,

[01:13:40] Tony: But nev­er did it.

[01:13:41] Cameron: know, clean­ing up the swamp. Well, he said, and then he stacked his admin­is­tra­tion with Mike Pom­peo and, you know, John Bolton and the gen­er­als who were all, you know, just main­tain­ing.

[01:13:53] Cameron: Like I said to you the oth­er day, I don’t think Trump real­ly did any­thing that any. Repub­li­can pres­i­dent in the last 20, 30 years would­n’t have done. He just end­ed up with a bunch of peo­ple, you know, and I don’t think his atten­tion span’s that great. So he prob­a­bly does­n’t know what’s hap­pen­ing from day to day.

[01:14:08] Cameron: So Green­wald was ask­ing this time around, will he actu­al­ly build an admin­is­tra­tion full of peo­ple that are going to pros­e­cute what he says he’s going to do, or it would just be a repeat of the same thing all over again, you know,

[01:14:19] Tony: Well, no, he’s going to build an admin­is­tra­tion of yes peo­ple. So what­ev­er Trump says that morn­ing, they’ll run around in cir­cles try­ing to do that day and the next day it’ll

[01:14:27] Tony: change.

[01:14:30] Cameron: Any­hoo, just mak­ing sure that he’s, uh, Got the best score on the score­board at the golf club.

[01:14:38] Tony: Oh, speak­ing of golf, it was the British Open this week­end. So I real­ly hap­pi­ly watched a lot of golf, but I played a cou­ple of rounds and I man­aged to win the C grade com­pe­ti­tion at my golf

[01:14:49] Tony: club

[01:14:50] Cameron: C grade!

[01:14:51] Tony: The C grade. Yeah. So, um, I beat Don­ald Trump

[01:14:58] Tony: or he did­n’t know that I’d won it. Oth­er­wise he would have, uh, he would have come in and,

[01:15:01] Tony: and trumped me. Yeah, big deal. Haven’t won a thing at golf for years. So that was, um,

[01:15:07] Tony: that was fun.

[01:15:08] Cameron: What did you get? Like a lit­tle tro­phy or some­thing?

[01:15:11] Tony: 50 buck pro shop vouch­er.

[01:15:13] Tony: Which will,

[01:15:14] Cameron: what can you get at a pro shop

[01:15:15] Cameron: for 50 bucks?

[01:15:16] Tony: you know, about nine golf, eight or nine golf balls, which will do me for a cou­ple of

[01:15:19] Tony: weeks

[01:15:20] Cameron: Yeah.

[01:15:21] Tony: before I lose them on the golf

[01:15:22] Tony: course.

[01:15:23] Cameron: Real­ly? Do you lose a lot?

[01:15:25] Tony: Uh, we, we play at a golf course, which is, has very high winds and a lot of rough. So yeah, I used, I actu­al­ly went around on the week­end with­out los­ing one, but I prob­a­bly aver­age one or two balls around in the rough,

[01:15:38] Tony: can’t find it.

[01:15:40] Cameron: I should send you the 400 that Fox has got in bags in the garage from pick­ing him up on golf

[01:15:45] Cameron: cours­es.

[01:15:46] Tony: Oh, we should get some reward for that. I’ll, I’ll buy some off him.

[01:15:50] Cameron: Yeah, how do I get them to you?

[01:15:53] Tony: Uh, next time I’m up in Bris­bane, we’ll go through them and I’ll pick out some.

[01:15:56] Cameron: gonna cost me a hun­dred bucks to ship them to

[01:15:58] Tony: Yeah, yeah. I’ll be up there at some stage again and we’ll go through the

[01:16:01] Tony: bar­rel and I’ll get some­one, give them some

[01:16:03] Tony: mon­ey.

[01:16:05] Cameron: I got a cou­ple of plugs for you. Film, I watched on Tubi, T U B I, the stream­ing ser­vice, the free stream­ing ser­vice that I’ve been using with a lot of great films from the 40s, 20s, through to the what­ev­ers. A lot of B, C, D grade, straight to video, straight to dri­ve in movies, which are often my favourite to watch.

[01:16:27] Cameron: Stingray from 1976, 1976. You ever seen that?

[01:16:32] Tony: No, I can’t say I have.

[01:16:34] Tony: Or per­haps I have, but

[01:16:35] Tony: I’ve for­got­ten it.

[01:16:37] Cameron: Can’t rec­om­mend this film enough if you like, sort of, 70s films. Writ­ten and direct­ed by a guy called Richard Tay­lor, whose name sound­ed famil­iar and I tried to fig­ure out why, um, real­ly could­n’t fig­ure it. Like, I don’t know him, it’s just one of those names that sounds famil­iar, but he did­n’t do much. He wrote a piece of, uh, Fright Show, which was a 1985, uh, hor­ror Mythol­o­gy that I might have saw back in the day, but any­way, this is, this is, this Stingray is a great plot, like low bud­get, sort of a mid sev­en­ties, um, car chase kind of film, a lot of real stunts, you know, the kind of thing, like Smokey and the Ban­dit kind of car

[01:17:25] Tony: right. Yep.

[01:17:27] Cameron: the plot is fan­tas­tic, real­ly

[01:17:29] Cameron: great, but it starts off with a drug deal goes bad in an alley late at night, two guys with, uh, Bags of coke, two oth­er guys arrive with the cash.

[01:17:43] Cameron: They do the trans­ac­tion and as the guys are count­ing, the guys who are sell­ing the drugs are count­ing the cash, they see a track­er in the brief­case under the cash. So they fig­ured these guys are going to track them down and kill them. So they pull guns out, kill the guys. So they take the coke and the mon­ey.

[01:18:01] Cameron: And they’ve a moose, but they hear cops behind them. So they need to stash it. So they pull, it’s like mid­dle of night in some town, Mid­west US. They pull into a car yard and one of them gets out and he gets the brief­case with the Coke and the cash, and he goes into a Corvette that’s for sale, a Corvette Stingray, and stash­es it behind the front seat, like they had the, the boot was behind the, the slight­ly a two seater behind the seat.

[01:18:26] Cameron: Then they get pulled over by the cops lat­er that night any­way, they get tak­en in, ques­tioned, held for 24 hours, they’ve got noth­ing on them so they have to let them go. The guys go back to the car yard to get their stuff, just in time to see two prep­py young guys get the keys and dri­ve away in it. By the way, in the car, get­ting him out of the police sta­tion was their boss, who’s a woman.

[01:18:48] Cameron: Who’s dressed up as a nun in dis­guise so the cops don’t rec­og­nize her. She’s this tough, gor­geous, uh, gang leader in the 70s, which is always great. Sher­ry Jack­son is the actress. Again, don’t know. She was a child actor, I think. Nev­er seen her in any­thing before or since. So any­way, they, they chase this stingray.

[01:19:08] Cameron: to try and run these guys down. The Stingray thinks they’re hav­ing a race, the guys in the Stingray, so they, they start speed­ing up and fang­ing around the streets. Then a cop car pulls out to chase them for speed­ing, pulls them over. The gang­sters come up behind, think the cops are going to find the drugs, kill the cops. But the cops have phoned in the fact that they’re chas­ing the Stingray, then they get killed. And so the rest of the cops think that the guys in the Stingray killed the cops. So now they’re chas­ing, so the guys in the Stingray have got the cops chas­ing them, the gang­sters chas­ing them, and they’re just two dum­mies who have no idea what’s going on.

[01:19:46] Cameron: Actu­al­ly, one of them’s played by Robert Mitchum’s son, Christo­pher Mitchum. Any­way, and, and hilar­i­ty, uh, ensues. Um, Uh, but it’s just a lot of fun. A lot of, some of the act­ing is great. Like some of the char­ac­ters are just larg­er than life and it’s just a lot of fun. I real­ly enjoyed it. Chris­sy came in halfway through it.

[01:20:05] Cameron: She real­ly enjoyed it because the, the, the woman who’s run­ning the gang­sters is this real­ly hard ass, cool, sort of badass chick who’s pulling machine guns and blow­ing peo­ple away and not tak­ing any shit from all the guys who work for her. Um, And then I watched anoth­er film on, uh, Tubi, The Assas­si­na­tion Bureau

[01:20:30] Tony: Well, that rings the bell.

[01:20:34] Cameron: Um,

[01:20:34] Cameron: 1969 British film star­ring Diana Rigg, a young, hand­some Oliv­er Reed, and Tel­ly Savalas.

[01:20:45] Tony: Now, I think I have seen this one, Cam, because as soon as you said it, I

[01:20:48] Tony: Rigg.

[01:20:50] Cameron: yes. She’s this, and again, just a great plot. I think this was remade maybe some years ago with um, Roger Stir­ling from Mad Men in it. But basi­cal­ly it starts off with her as a jour­nal­ist, a wannabe jour­nal­ist. She’s this pris­sy, it’s set in like the 1800s. She’s this pret­ty woman who, um, is brief­ing a bunch of jour­nal­ists, the pro­pri­etor of a news­pa­per in Lon­don, played by Tel­ly Savalas, putting on a British accent, about this orga­ni­za­tion called the Assas­si­na­tion Bureau that she’s heard rumors of that, uh, that kill for hire, but high pro­file politi­cians and busi­ness lead­ers and that kind of stuff.

[01:21:31] Cameron: And she wants to sort of break a sto­ry on them, so Tel­ly Savalas, gives her the com­mis­sion to go and research it. So she tracks these orga­ni­za­tion down and gets a meet­ing with the head of the orga­ni­za­tion. The chair­man, Oliv­er Reed, says she has a com­mis­sion for him. And he said, well, you know, we only kill peo­ple who real­ly deserve it.

[01:21:50] Cameron: She said, well, this per­son is a mur­der­er. And he suf­fers from arro­gance and pride and all. He goes, well, okay, we’ll take the com­mis­sion. Who is it? And she says, it’s him. Uh, so she puts a com­mis­sion of his assas­si­na­tion bureau out on him­self and he accepts it. He goes, okay, fair call. So he goes to his board and then it turns out Tel­ly Savalas is the vice chair­man of the board.

[01:22:13] Cameron: So he knew what, this is Tel­ly Savalas plot to get rid of the boss and take his job. But any­way, so the chair­man, Oliv­er Reid then says to his board,

[01:22:22] Cameron: so you’re all get­ting slack and you, you know, I don’t think our integri­ty is what it once was. You have, you have 24 hours before the race starts. You have to kill me or I will kill you.

[01:22:34] Cameron: And so then it’s just this movie of them all plot­ting to try and assas­si­nate him and, and they’re wear­ing dis­guis­es and he’s wear­ing dis­guis­es and Diana Rig­g’s in the mid­dle of the whole thing. Absolute­ly stu­pid. Um, and played as a com­e­dy, you know, but, um, real­ly fun, like a great, real­ly good, enter­tain­ing, good old time 60s British film, which, any­way.

[01:22:58] Cameron: Real­ly enjoyed it.

[01:23:00] Tony: Oh, good.

[01:23:00] Cameron: High­ly rec­om­mend­ed

[01:23:01] Cameron: if you can track it down.

[01:23:03] Tony: Yeah, I’ll look them up.

[01:23:04] Tony: Sounds

[01:23:04] Tony: great.

[01:23:05] Cameron: Direct­ed, by the way, by Basil Rear­don, uh, Dear­den. Basil Dear­den, who, um, did a lot of great, uh, films in the 40s, 50s. One of the great British direc­tors of that peri­od. And then, um, my last rec­om­men­da­tion is music wise, the Jim Car­roll Band. You ever come across the Jim Car­roll Band?

[01:23:25] Tony: No, I

[01:23:25] Tony: haven’t. No.

[01:23:27] Cameron: Ever seen the Bas­ket­ball Diaries?

[01:23:29] Cameron: Leonar­do DiCaprio film from the, uh, No? Okay.

[01:23:32] Tony: Oh, yuck.

[01:23:33] Tony: No.

[01:23:34] Cameron: I knew Jim Car­roll, I knew who he was, uh, no,

[01:23:36] Cameron: for decades. He was a Amer­i­can poet, um, got into hero­in and, uh, got his mon­ey from hero­in by pass­ing out sex­u­al favors under bridges and that kind of stuff, and, um, he wrote a mem­oir called The Bas­ket­ball Diaries that Leonar­do DiCaprio, um, starred in as a film, good film, just about, you know, his tough life as a, you know, poet, sort of drug­gie, addict, that kind of thing, got clean, Um, dat­ed, um, Pad­dy

[01:24:09] Cameron: Smith, lived with Pad­dy Smith and Robert Map­plethor­pe after he got clean, dat­ed Pad­dy Smith.

[01:24:13] Cameron: Any­way, Pad­dy, he had a punk band called the Jim Car­roll Band that put out two albums in the 70s. And it’s kind of like a cross, but he’s a poet, like a real poet, who cre­at­ed a punk band. And it’s like a cross between the Stooges, MC5, and, you know, maybe Lou Reed. And, um, with a real­ly Sur­pris­ing music. I like, I was one of these things like, how the hell have I nev­er

[01:24:39] Tony: Yeah.

[01:24:40] Cameron: heard this before?

[01:24:41] Cameron: I know Jim Car­roll, total­ly in my wheel­house, 70s punk. Um, and, uh, yeah, any­way, there’s two albums on Spo­ti­fy. If you like 70s punk, if you like the Stooges, that kind of stuff, I can high­ly rec­om­mend it, good stuff. Pat­ti Smith, all that kind of jazz.

[01:25:00] Cameron: Well, my head­phones just dropped out on me, Tony. So I think that’s

[01:25:05] Tony: It’s a sign. It’s a moment.

[01:25:07] Cameron: Run out of bat­tery.

[01:25:10] Tony: Well, that’s good. Thank you.

[01:25:12] Cameron: go have a good week.

[01:25:13] Tony: Yes. Hap­py ASX.

[01:25:16] Tony: All right.

[01:25:16] Cameron: Talk to you next

[01:25:17] Cameron: week.

[01:25:18] Tony: Thank you.