QAV 805 — Whack A Mole

805 Club Audio

[00:00:00] Tony Kynas­ton: 3, 2, 1, 1, 2, 3.

[00:00:08] Cameron Reil­ly: Wel­come back to Q‑A-V-T‑K. We’re record­ing this on the 4th of Feb­ru­ary, 2025, uh, the day after the US imple­ment­ed tar­iffs and then unim­ple­ment­ed them imme­di­ate­ly. Um,

[00:00:28] Cameron Reil­ly: what a

[00:00:28] Tony Kynas­ton: Did they real­ly imple­ment? Did they imple­ment? Real­ly?

[00:00:33] Cameron Reil­ly: What, it’s, as we were just say­ing off air, it’s, uh, Trump whack a mole, and, you know, it just col­lapsed our mar­ket by, what­ev­er it was, 100 bil­lion dol­lars, yes­ter­day, and I think it’s, I haven’t checked today, I think it was back this morn­ing when I had a look, I haven’t had a look today. Uh, since I went to train­ing,

[00:00:51] Cameron Reil­ly: but,

[00:00:52] Tony Kynas­ton: Not, not com­plete­ly back, but it’s back a lit­tle bit.

[00:00:55] Cameron Reil­ly: right, yeah, oh, no, it’s only, like, even, not even halfway back to where it was.

[00:01:03] Cameron Reil­ly: Any­way, uh, how are you, TK?

[00:01:05] Tony Kynas­ton: Very well. Enjoy­ing watch­ing Justin Trudeau earnest­ly try and talk to the Amer­i­can peo­ple about tar­iffs. The issue isn’t tar­iffs, Justin. Laugh it off, man. Go and find out what Trump real­ly wants.

[00:01:20] Cameron Reil­ly: Well, he’s out of a job any­way, isn’t he?

[00:01:23] Tony Kynas­ton: he’s already resigned. Yep.

[00:01:24] Cameron Reil­ly: Hmm.

[00:01:25] Tony Kynas­ton: Yeah,

[00:01:27] Cameron Reil­ly: Speak­ing of res­ig­na­tions, uh, I just saw in the news, as I was set­ting up, that, uh, the CEO of Res­olute Min­ing. Okay.

[00:01:47] Tony Kynas­ton: Okay, yeah. Put a tar­iff on it.

[00:01:52] Cameron Reil­ly: I don’t know, he gets, he gets, uh, held in deten­tion in Mali for a week and he resigns,

[00:01:58] Cameron Reil­ly: like.

[00:01:59] Tony Kynas­ton: it’s not. Was he? Was he? I thought it was West African Resources.

[00:02:03] Cameron Reil­ly: No, Res­olute

[00:02:04] Tony Kynas­ton: Oh, it was Res­olute. Okay.

[00:02:05] Cameron Reil­ly: yeah, yeah. Ter­ry Ter­ry Holo­han has resigned fol­low­ing his deten­tion in Mali. So, uh, Uh, I can under­stand that,

[00:02:16] Tony Kynas­ton: is he now work­ing for the gov­ern­ment of Mali?

[00:02:19] Cameron Reil­ly: it does­n’t say, but uh, their share price col­lapsed again from 42 cents down to 37 cents, so for­tu­nate­ly we were out of it already, but you know, go back to Novem­ber, it was trad­ing up around 76 cents. And then it did­n’t recov­er from that and now it’s tak­en anoth­er hit. So, um, yeah,

[00:02:49] Cameron Reil­ly: I hope

[00:02:50] Tony Kynas­ton: thing we got

[00:02:50] Tony Kynas­ton: out

[00:02:51] Cameron Reil­ly: Min­ing.

[00:02:51] Cameron Reil­ly: Yeah. I hope every­one got out.

[00:02:53] Tony Kynas­ton: As Phil Mus­catel­lo says, the first cut is the cheap­est.

[00:02:57] Cameron Reil­ly: Oh yeah. There you go. Good one, Phil. So what do you want to talk about today, TK?

[00:03:06] Tony Kynas­ton: Well, I thought we’d, uh, talk, we’ll turn this into the tar­iff show, shall we? I mean, you know, this is the sign of a frothy mar­ket. Val­u­a­tions are up. So any sort of trem­bles in the inter­na­tion­al mar­ket is going to take one or two per­cent off our share mar­ket for sure. So that’s just. Take those grant­ed, don’t get too upset.

[00:03:27] Tony Kynas­ton: Um, I, I’m not a fan of tar­iffs. I mean, if we talk about tar­iffs, for­get about Trump and just talk about why tar­iffs are good or bad. I think they’re bad in gen­er­al. And, um, I always, one of the only things I’ve ever heard that made sense from an econ­o­mist is, uh, is known as the Ricar­do effect, which basi­cal­ly means that, um, coun­tries should stick to

[00:03:53] Cameron Reil­ly: Ricky Ricar­do from My Love

[00:03:54] Cameron Reil­ly: Lucy.

[00:03:55] Tony Kynas­ton: no, no, dif­fer­ent Ricar­do. Um, the coun­try should, um, con­cen­trate on what they do best. So in Aus­trali­a’s case, it’s, it’s min­ing. Um, you know, we should, uh, make min­ing a key indus­try and do what­ev­er we can to sell or over­seas, cause that’s the best ben­e­fit for Aus­tralia in terms of its uti­liz­ing its resources, um, instead of say­ing that, uh, well, we want to also be a man­u­fac­tur­ing pow­er­house.

[00:04:23] Tony Kynas­ton: We also want to be a. in a account­ing pow­er­house or an AI pow­er­house or a tech pow­er­house and putting lots of effort and resources into those things when real­ly we can’t com­pete with the real pow­er­hous­es in dif­fer­ent coun­tries over­seas. So the Ricar­do mod­el, or the Ricar­do effect it’s some­times called, just says stick to your knit­ting and then trade.

[00:04:45] Tony Kynas­ton: What you do best with some­body else for what they do best. And it actu­al­ly is the most effi­cient way of allo­cat­ing resources around the world. And I think that’s, that’s pret­ty true. And I always come back to the sim­ple anal­o­gy. Um, If I was a busi­ness own­er, like a cof­fee store own­er, uh, I’m not going to do my own books, I’m not going to, I mean, poten­tial­ly I can, um, do my own IT, put up my own web pres­ence, um, et cetera, et cetera, I’m going to out­source those tasks, per­haps mar­ket­ing, um, et cetera.

[00:05:16] Tony Kynas­ton: Any sort of HR advice I need, legal advice that I need. I’m not going to train as a lawyer so I can run my cof­fee shop and han­dle all my own legal cas­es. I’m going to get advice. And that’s the same sort of thing. You stick to your, to brew­ing beans. That’s what you do best and you sell that. in the mar­ket­place and you buy the oth­er ser­vices from the experts in those fields that con­cen­trate on doing that and that’s a much bet­ter allo­ca­tion of time and effort and resources than try­ing to estab­lish non com­pet­i­tive indus­tries and we kind of found that out in Aus­tralia any­way when the through the car indus­tries.

[00:05:52] Tony Kynas­ton: Where we had big tar­iffs to sup­port local man­u­fac­tur­ing and, um, even­tu­al­ly that becomes kind of per­verse because you’d have to argue that Fords and GMs My main busi­ness com­pe­ten­cy was­n’t mak­ing cars. It was seek­ing assis­tance from gov­ern­ments and threat­en­ing to leave the gov­ern­ment if they did­n’t receive an appro­pri­ate lev­el of gov­ern­ment fund­ing.

[00:06:17] Tony Kynas­ton: And, you know, when their bluff was called, um, they left. And as I was say­ing to you off air, I’m in the mar­ket for a small car for Jen­ny and then, and to be shared by Alex when she learns to dri­ve even­tu­al­ly. Um, but,

[00:06:32] Cameron Reil­ly: Alex does­n’t dri­ve.

[00:06:33] Tony Kynas­ton: Nope.

[00:06:34] Cameron Reil­ly: She’s like 25.

[00:06:37] Tony Kynas­ton: Yeah. Oh, Jen­ny does­n’t dri­ve either, she has­n’t dri­ven in 10 years, but I’m kind of forc­ing her to make her own way to Mel­bourne. Um, any­way, my point is like I was out look­ing at cars yes­ter­day, the day before, and, you know, the, The car you can buy now, brand new for 20 25 grand, is bet­ter if not the equal of a car you could buy from GM or Ford for twice that cost, um, 10 years ago, so, you know, I think, I think, um, the Ricar­do effect is alive and well in the car indus­try now, and we’re see­ing the ben­e­fits of it, real­ly.

[00:07:12] Tony Kynas­ton: Now look, there’s, there are some cav­i­ties to it, and I know peo­ple will say, oh, but we can’t let, you know, Every­thing go over­seas because if there’s a war or there’s an embar­go, we won’t get access to man­u­fac­tured goods or par­tic­u­lar food­stuffs or oil or what­ev­er. And you can take var­i­ous sur­gi­cal and spe­cif­ic ways to pro­tect that, but, but the over­all, um, Blunt instru­ment of using a tar­iff does­n’t usu­al­ly work.

[00:07:39] Tony Kynas­ton: So, in my heart of hearts, I think Trump knows that. He’s just try­ing to find a way that he can gain lever­age, lever­age on oth­er coun­tries to nego­ti­ate an out­come that he wants in some oth­er issue. So, that’s what I think is going on. Um, may affect the Aus­tralian mar­ket. I could be wrong in that. If there’s a big tar­iff put on Chi­na and Chi­na stops, you know, man­u­fac­tur­ing as much and there­fore stops using our iron ore as much, et cetera, et cetera.

[00:08:04] Tony Kynas­ton: It’ll have flow on effects to us, but we haven’t seen that yet. And we did­n’t see it last time in the Trump pres­i­den­cy. And he learned last time that if he, you know, When he did put tar­iffs on, the peo­ple start­ed revolt­ing. They start­ed say­ing, hey, we’re like, we’re sick of pay­ing more for these goods. This is not work­ing, fel­la.

[00:08:22] Tony Kynas­ton: And he quick­ly rescind­ed them after, you know, a short peri­od of time. So this isn’t about tar­iffs. This is about lever­age and nego­ti­a­tions. And peo­ple need to wake up to that.

[00:08:31] Cameron Reil­ly: He rescind­ed the tar­iffs. I thought they were still on when Biden took over and then Biden increased them.

[00:08:36] Tony Kynas­ton: No, pos­si­bly, but, um, no, I’m sure that a lot of them that were put on were tak­en off soon after they were put on.

[00:08:45] Cameron Reil­ly: Well, it’s, uh, you know, who knows what goes on in the mind of Trump. Um, I, I, I don’t think he thinks about it much more than what’s going to grab head­lines for the day and make him look tough

[00:08:59] Cameron Reil­ly: and

[00:09:00] Tony Kynas­ton: Mm

[00:09:01] Cameron Reil­ly: keep the, keep keep­ing the media dis­tract­ed. While, uh, he and his friends are doing some­thing behind the

[00:09:08] Cameron Reil­ly: scenes to

[00:09:08] Tony Kynas­ton: that’s the oth­er thing, too, is that, um, you know, if tar­iffs do go on and he rais­es rev­enue, he’ll drop tax­es, but it won’t be for the peo­ple pay­ing for the tar­iffs. It’ll be for him and his cronies. Yeah.

[00:09:18] Cameron Reil­ly: I saw an econ­o­mist talk­ing on, um, video, yes, I think it was a Wall Street Jour­nal video, Amer­i­can econ­o­mist was talk­ing about tar­iffs that were put on, um, Chi­nese wash­ing machines. I think this was dur­ing the Trump’s first term. And he said, you know, peo­ple think that if you put tar­iffs on, um, for­eign imports, like wash­ing machines, that the domes­tic man­u­fac­tur­ers will leave their prices where they are, but that does­n’t hap­pen.

[00:09:50] Cameron Reil­ly: does­n’t work. He said, so if you’re pay­ing like 200 for wash­ing machines, then you put 100 per­cent tar­iffs on the Chi­nese imports. So they go from 200 to 400. The domes­tic man­u­fac­tur­ers don’t leave their prices at 200. They go, Oh, we can go up to 300, 350 now and still be the cheap­est in the mar­ket. So prices go up across the board, which con­sumers have to pay for.

[00:10:13] Cameron Reil­ly: He said, but then Prices on Clothes dry­ers also went up even though they weren’t part of the tar­iffs because there’s an expec­ta­tion that they’re rough­ly priced about the same so the price is up. He said so the U. S. Trea­sury gained some­thing like 85 mil­lion dol­lars a year from tar­iffs on Chi­nese wash­ing machines.

[00:10:36] Cameron Reil­ly: But econ­o­mists esti­mat­ed that Amer­i­can con­sumers paid an extra 1. 8 bil­lion dol­lars for wash­ing machines and clothes dry­ers as a result of the tar­iff. So

[00:10:50] Tony Kynas­ton: Well, that’s a good point. I mean, you, yeah, um, the tar­iff, if it’s, if it’s set like that, kills the Chi­nese. Exporter, which means no tar­iffs or levy.

[00:11:02] Cameron Reil­ly: Wow. Yeah. In

[00:11:02] Cameron Reil­ly: the­o­ry.

[00:11:03] Tony Kynas­ton: the Amer­i­can man­u­fac­tur­er only has to beat the price by 10 bucks to get the busi­ness. So they put it up. And also too, they prob­a­bly like, you know, it’s very dif­fi­cult for a man­u­fac­tur­ing plant to dou­ble capac­i­ty tomor­row.

[00:11:16] Tony Kynas­ton: Like when the tar­iff is put on, espe­cial­ly if it’s done capri­cious­ly and there’s no full plan­ning or notice of it. So they can’t meet demand. So the way you solve that equa­tion is you put your price up.

[00:11:29] Cameron Reil­ly: Well, any­way, uh, from an invest­ing per­spec­tive, chaos, but we just stick to our knit­ting and do what we can do. Uh, what else have you got on your list of talk­ing points?

[00:11:43] Tony Kynas­ton: Uh, I saw that, um, there was an arti­cle, I think in The Fin, that said that, uh, the Wil­son Asset Man­age­ment, um, sta­ble of LICs was about to get a new one, and this new one was going to, uh, focus on own­er founders. Which I thought was inter­est­ing giv­en that’s one of the things we look for in select­ing our stocks.

[00:12:06] Tony Kynas­ton: And, um, they, uh, they’re talk­ing about set­ting up an own­er founder fund and they claim that, um, like again, it seems like it was part of their research was to look for com­pa­nies with own­er founders and give them pri­or­i­ty when they invest. And they, they claim that, uh, um, just try­ing to find that over the last sev­en years that, uh, they’re.

[00:12:32] Tony Kynas­ton: Own­er or founder led com­pa­nies, they call it, has out­per­formed the ASX Ordi­nar­ies Accu­mu­la­tion Index by 12. 5%. So, you know, giv­en that the index has prob­a­bly aver­aged 7 or 8 per­cent over that time, it’s, um, that’s quite a good return from own­er founders. So, um, it kind of val­i­dates what we, uh, what we, um, look for as well and expect.

[00:12:54] Tony Kynas­ton: And there were a few caveats in there because we’ve also seen founders behav­ing bad­ly in the last 12 months and, um, You know, Twig­gy’s gone off and done some strange things with hydro­gen and, um, lethal humid­i­ty, as he calls it. Um, he’s gone through a messy divorce. Not a messy, I don’t know if it’s messy or not, but gone through a divorce.

[00:13:13] Tony Kynas­ton: Um, Chris, uh, Chris, uh, Alli­son at, um, Min­er­al Resources has had, um, Tax office issues. Richard White at, um, at WiseTech Glob­al has had all kinds of per­son­al issues. And so some­times a founder can go off the rails a lit­tle bit, but, um, The plan for WAM’s new fund, Wil­son Asset Man­age­men­t’s new fund, is to use those as red flags and look for Um, uh, the founder not focus­ing on the busi­ness as a red flag or sell­ing down as a red flag.

[00:13:48] Tony Kynas­ton: Um, so I thought that was inter­est­ing.

[00:13:51] Cameron Reil­ly: Should we have those in our check­list?

[00:13:54] Tony Kynas­ton: Yeah, it’s a good ques­tion. Um, pos­si­bly. Um, I, um, yeah, I haven’t thought too much about it, but yeah, there’s a few. Yeah. Oh, Twig­gy. Twig­gy, I think we red flagged any­way, did­n’t we?

[00:14:06] Cameron Reil­ly: Yeah,

[00:14:07] Tony Kynas­ton: when every­one start­ed leav­ing, the top brass start­ed leav­ing.

[00:14:10] Cameron Reil­ly: yeah,

[00:14:10] Tony Kynas­ton: yeah,

[00:14:11] Cameron Reil­ly: yeah, we did say that was­n’t a good sign.

[00:14:13] Tony Kynas­ton: Yeah.

[00:14:16] Cameron Reil­ly: Uh, any­thing else?

[00:14:18] Tony Kynas­ton: No, I think that’s it. I’ve got a pulled pork to do, but I’ll hand over to you first. Okay. See you. Hmm.

[00:14:25] Cameron Reil­ly: Uh, the dum­my port­fo­lio for the finan­cial year is up near­ly 16 per­cent ver­sus the STW up about 11%. So, it’s doing quite well. Um, my super port­fo­lio’s not doing as well. It’s up about 8 per­cent and the light group as a group is up about 7 per­cent but the dum­my port­fo­lio con­tin­ues to just chug along. I don’t know the last time I actu­al­ly saw some­thing I did have to sell recent­ly but I trade, you know, I very rarely trade any­thing in the dum­my port­fo­lio. It just seems

[00:15:11] Cameron Reil­ly: to, yeah. Let’s see. The last thing I sold. In the dum­my port­fo­lio was FPR, I sold back in Decem­ber, uh,

[00:15:27] Tony Kynas­ton: Right.

[00:15:28] Cameron Reil­ly: 23rd of Decem­ber, replaced it with PPM, um, before that I sold some­thing like Novem­ber, 18th of Novem­ber, before that I had­n’t sold any­thing since August, so, yeah, it just trun­dles along and it’s just the port­fo­lio that it’s got.

[00:15:47] Cameron Reil­ly: Just as good. Just chug­ging along. It’s crazy. Uh, the US port­fo­lio is all time. It’s up. It’s cur­rent­ly run­ning at about 80 per­cent ver­sus the S& P 500 at about 35%. So it’s still doing bet­ter than dou­ble, but it was doing triple going back to Novem­ber. It’s come off a lit­tle bit since then. Um, but still.

[00:16:16] Cameron Reil­ly: Can’t real­ly com­plain about the per­for­mance of that. So that’s that. Uh, what else have I got here? Let me see. Ah, there was a great post mortem I read of Mosa­ic Brands in the ABC this week. Um, you know, we’ve, we’ve, I think we’ve sort of touched on this a bit over the last few months. You talked about, you know, Non­ny B and, um, The dif­fer­ent brands in the non EB group, Rivers, Millers, Cady’s.

[00:16:49] Cameron Reil­ly: Uh, I think they’ve just announced that they’re shut­ting down the last of those. There was like a res­cue attempt, but um, it failed. The receivers and man­agers of Mosa­ic Brands Group today announced the clo­sure of Miller’s and Non­ny B, the remain­ing brands and stores in the Mosa­ic Brands port­fo­lio, a spokesper­son said.

[00:17:13] Cameron Reil­ly: The clo­sure means 252 stores will shut­ter and 933 employ­ees will be impact­ed. Despite the best efforts of all par­ties, we have been unable to achieve a sale of any of the brands with­in the Mosa­ic Port­fo­lio. KPMG part­ner David Hardy said. Fash­ion and busi­ness expert Dr. Car­ol Tan said the out­come was not unex­pect­ed.

[00:17:36] Cameron Reil­ly: Giv­en the cur­rent retail envi­ron­ment, the finan­cial strug­gles of mosa­ic brands, it is under­stand­able that no buy­ers were found for Miller’s and Non­ny B. She said the retail sec­tor has been fac­ing sig­nif­i­cant chal­lenges over the past few years, includ­ing eco­nom­ic pres­sures, chang­ing con­sumer behav­iours and the rise of online shop­ping.

[00:17:57] Cameron Reil­ly: So they said the total num­ber of job loss­es is expect­ed to exceed 2, 000. I know, we’ve, we’ve sort of had Mosa­ic brands on our buy list from time to time, over the years I think. And we’ve talked on and off about The chal­lenges of retail and also online retail and, you know, how that was slow­ly chal­leng­ing Aus­tralian retail­ers, your Ama­zons, your AliEx­press, Temu, um, some of those sorts of busi­ness­es and the fail­ure of the Aus­tralian brands to be able to com­pete suc­cess­ful­ly with those.

[00:18:38] Cameron Reil­ly: But

[00:18:39] Tony Kynas­ton: And also, and also the fast fash­ion brands, the H& M’s and peo­ple like that, Uniqlo’s, which are pro­duc­ing over­seas very cheap­ly. It’s

[00:18:47] Tony Kynas­ton: a

[00:18:49] Cameron Reil­ly: so any­way, that’s the end of anoth­er, uh, Aus­tralian brand that’s been around in one way, shape or form for a very long time.

[00:18:57] Cameron Reil­ly: Yeah.

[00:18:58] Tony Kynas­ton: in Non­ny B and did real­ly well out of it for a while. Prob­a­bly about 15 years ago or more. City Sheet Col­lec­tive, I think it’s called, or was called, um, did real­ly well out of. Um, and again, you know, got out at the right time. Thanks to our. method­ol­o­gy. But yeah, I mean, this is talk­ing about tar­iffs.

[00:19:21] Tony Kynas­ton: I mean, the rag trade was sup­port­ed, the tex­tile indus­try in Aus­tralia was sup­port­ed for a long time due to tar­iff bar­ri­ers. When peo­ple would argue we need­ed to main­tain employ­ment, we need­ed to have our own man­u­fac­tur­ing base, our own shoes and clothes in case we could­n’t get them from over­seas or what­ev­er.

[00:19:40] Tony Kynas­ton: But those, Tar­iffs were wound back, I guess, prob­a­bly start­ing with the Hawke Keat­ing gov­ern­ment, as they tried to inter­na­tion­al­ize the econ­o­my. Um, yeah, so this is the kind of tail end of that process, I think. And again, like, you know, is the, is the end user bet­ter off or not, where you can buy, as you say, cheap stuff on Temu, um, and have it deliv­ered to your door for prob­a­bly a, well, I was going to say a frac­tion of the price, but a lot less than going into a riv­er store and buy­ing it There.

[00:20:12] Tony Kynas­ton: Now, you could argue the qual­i­ty is bet­ter in the riv­er store, um, and you’re sup­port­ing local employ­ment, etc. But, uh, at the end of the day, when there’s a lot of pres­sure on peo­ple’s wal­lets, they opt for the fast fash­ion from Timo.

[00:20:30] Cameron Reil­ly: Yes. Um, so what else have I got in the news? WGX was a 3PTCL, 3, 3, what? 3PTL sell. It’s hard to say, this era of the day. It was a 3 point trend­line sell Mon­day after they came out with their FY25 guid­ance update and the shares dropped 12%. In the morn­ing, it was, um, uh, well, we still got out at a prof­it, but, uh, it was a big drop, very quick, big drop.

[00:21:01] Cameron Reil­ly: Um,

[00:21:02] Tony Kynas­ton: And that’s, that’s, that just remind­ed me too, it’s, um, That’s going to hap­pen more and more over the next month or so because it’s report­ing sea­son. So we’re going to see volatil­i­ty in the mar­ket. And so just to high­light, peo­ple need to be close to their port­fo­lios, close to their alerts for the next month or so, because the mar­ket will move.

[00:21:25] Tony Kynas­ton: We often see 20 per­cent moves in stocks as they release results, and that could either be a buy or a sell for us, depend­ing on how it goes.

[00:21:34] Cameron Reil­ly: it dropped from 2. 58 down to 2. 23 in the space of half an hour. It’s recov­ered a lit­tle bit today.

[00:21:45] Tony Kynas­ton: I’m not famil­iar with West Gold, but it’s kind of sur­pris­ing giv­en that the gold price is hit­ting all time records, um, as one of the safe havens giv­en all the flex­i­bil­i­ty in mar­kets over­seas.

[00:21:57] Cameron Reil­ly: Well, it was one of those things too, where when I read their. Announce­ment. It did­n’t strike me as that bad, you know, it seemed like a bit of an over­re­ac­tion, like, the guid­ance update, I’ll just pull it up here, it said, so, they’ve been through a merg­er recent­ly, and the post merg­er guid­ance was pro­duc­tion of 400, 000 to 420, 000 ounces, they’ve reduced that down to 330, 000 to 350, 000,

[00:22:30] Tony Kynas­ton: Big drop.

[00:22:32] Cameron Reil­ly: Yeah, it’s a big drop. But then they say, um, Post merg­er FY25 pro­duc­tion guid­ance was pred­i­cat­ed on the simul­ta­ne­ous ramp up of Beta Hunt to 2 MPTA and Blue Bird South Junc­tion to 1. 2 MTPA. Dur­ing H1 FY25, the ramp ups of both assets were slow­er than planned. Pre­dom­i­nant­ly due to engi­neer­ing, not min­er­al resource issues.

[00:23:01] Cameron Reil­ly: At Beta Hunt, pro­duc­tion was adverse­ly affect­ed by the need to under­take sig­nif­i­cant upgrades of pri­ma­ry ven­ti­la­tion, mine pump­ing sys­tems, and clean water sup­ply. West Gold’s cap­i­tal invest­ment strat­e­gy is sys­tem­at­i­cal­ly remov­ing these pro­duc­tiv­i­ty con­straints to deliv­er high­er pro­duc­tion in H2 FY25 and beyond.

[00:23:21] Cameron Reil­ly: I read that and I was like, yeah, right. So, you know, they had to, you know, I had to do some upgrades on these things before they said there’s going to be a lit­tle bit of a delay before they hit pro­duc­tion. I mean, it’s real­ly not that bad. But, it was a 3PTL sell, so I sold. But, um, I kind of feel like it’s prob­a­bly going to bounce back as pro­duc­tion ramps up.

[00:23:44] Cameron Reil­ly: Assum­ing that they have a clear run from now on. But, rules is rules.

[00:23:48] Cameron Reil­ly: Um, also in the news, our old friend Fin­di, the Reserve Bank of India has approved their full acqui­si­tion of Tata Pay­ment Solu­tions. Find­i’s, um, been real­ly good for us. Uh, it’s been a, been a great lit­tle stock, but it’s volatile, it’s all bug­gery. Um, You know it goes up and down so much like going back to end of Novem­ber was at 7.

[00:24:20] Cameron Reil­ly: 75 by the 9th of Jan­u­ary it had dropped down to 3. 50 and now it’s back up to 4. 64 today on this news so um it’s it’s a good You know, I’m not com­plain­ing. I think we’re still up, very well up on it. But, for the kind of busi­ness that it is, and there does­n’t seem to be any rea­son why it dropped by 50%, At the end, in Decem­ber, like there was no announce­ments, they did­n’t lose any­thing, they’re just in India doing what they’re doing.

[00:24:57] Cameron Reil­ly: Um, I can’t, I can’t under­stand why it’s as volatile as it is, it does­n’t make any sense on the sur­face of things. You got any insights?

[00:25:07] Tony Kynas­ton: Oh no, I think it’s a small com­pa­ny oper­at­ing over­seas. So yeah, it’s going to be volatile. I haven’t real­ly fol­lowed it for a while. I’m just going to have a quick look at it. I’m guess­ing that even though it was a val­ue stock, it’s prob­a­bly more like a gross stock now. I know there was plans to float off a large chunk of their busi­ness.

[00:25:29] Tony Kynas­ton: So that would have been dri­ving their use, prob­a­bly push­ing it up too far. And now it’s come back to where it should be. But if I look at it

[00:25:35] Tony Kynas­ton: now The, what’s the PE ratio on NDI at the moment? Yeah, so the well it’s, it’s, um, loss mak­ing. The last PE that we actu­al­ly was a PE was 51 times, so it’s been a val­ue stock for us in the past, and we iden­ti­fied it.

[00:25:55] Tony Kynas­ton: In fact, the March PE ratio was sev­en times ris­ing to 51 times. So it sounds like it got a bit over­bought cam.

[00:26:04] Cameron Reil­ly: I added it to a, one of the live port­fo­lios in May of last year at $3 22. So it’s up 44%

[00:26:12] Tony Kynas­ton: Mm-hmm

[00:26:13] Cameron Reil­ly: then. I’m not com­plain­ing, but it was up, you know, a hun­dred per­cent at one point. Easy come, easy go, I guess, any­way.

[00:26:22] Tony Kynas­ton: Oh, and pos­si­bly will come again. I mean, I remem­ber doing a pulled pork on it and there was some talk about, I’m not sure if it was part of this Tatar financ­ing acqui­si­tion, but they were going to hive off part of their busi­ness, per­haps the ATMs, I’m not sure, or the pay­ments side of it, into a sep­a­rate list­ing on the Indi­an stock mar­ket.

[00:26:43] Tony Kynas­ton: And that’s what’s dri­ving up the val­u­a­tion. That may still hap­pen and still prove to be a game chang­er for them. So we’ll

[00:26:50] Tony Kynas­ton: see.

[00:26:50] Cameron Reil­ly: Mm All right. Well, that’s all I’ve got on my talk­ing points, Tony, for this week.

[00:26:57] Cameron Reil­ly: You wan­na do

[00:26:58] Tony Kynas­ton: So do you want me to do a pulled pork?

[00:26:59] Cameron Reil­ly: Hmm? Who are you doing today?

[00:27:01] Tony Kynas­ton: Aure­lia Met­als, AMI, anoth­er gold min­er, pre­dom­i­nant­ly, also mines cop­per and, uh, sil­ver and zinc, and a bit of lead. Um, I had a look at what com­pa­ny on the buy list to do a pulled pork on and could­n’t find one that was, was­n’t going back­wards. And I had a look last night and this morn­ing, but, um, Aure­lia seems to have recov­ered back to where it was.

[00:27:29] Tony Kynas­ton: Pri­or to the talk of tar­iffs in the US and you know, it’s, it’s a gold min­er. So gold is seen as a safe haven asset. Um, so you’d expect the gold min­ers not to be retreat­ing as much as the rest of the mar­ket. Uh, I did a pulled pork on the stock. I’m going to say about three years ago, maybe four years ago.

[00:27:49] Tony Kynas­ton: Um, it’s been on and off our buy list for a long time. Um, and after I did the pulled pork, of course it dropped in val­ue. And, uh, I actu­al­ly owned it and had to sell. Um, but the inter­est­ing thing about that pulled pork, I think it was the first occur­rence of our dis­cus­sions on which com­mod­i­ty to use when using a com­mod­i­ty graph to track a stock because, um, Aure­lia does mine a num­ber of dif­fer­ent met­als.

[00:28:14] Tony Kynas­ton: And it’s not unusu­al to see a gold min­er, uh, also, uh, mine cop­per. Um, which often times occurs at the same place under the ground, but, uh, yeah, I checked again with the, um, annu­al report, most recent annu­al report, and still more than half of the rev­enues for Aure­lia come from gold, so we’ll stick with using the gold com­mod­i­ty, uh, chart as our, our under­ly­ing buy and sell trig­ger for the com­pa­ny.

[00:28:39] Tony Kynas­ton: Um, who is Aure­lia Met­als? Well, from their own results announce­ment a cou­ple of years ago. They are an Aus­tralian gold and base met­als min­ing and explo­ration com­pa­ny. And I think base met­als is how they group cop­per, lead, zinc, and sil­ver. Um, Aure­lia Ron­son oper­ates three under­ground mines and pro­cess­ing facil­i­ties in New South Wales.

[00:29:02] Tony Kynas­ton: One’s called the Peak Mine. which mines gold, lead, zinc, cop­per and sil­ver. They also have the HERA mine, which mines gold, gold, lead, zinc and sil­ver, no cop­per. And they acquired the DARGS mine, D A R G U E S mine, which pre­dom­i­nant­ly has gold. Aure­li­a’s high­ly prospec­tive ten­e­ment hold­ings enable the com­pa­ny to advance tar­get­ed explo­ration and eval­u­a­tion activ­i­ties with­in prox­im­i­ty of Aure­lia owned infra­struc­ture.

[00:29:33] Tony Kynas­ton: Our pre­em­i­nent near term devel­op­ment projects include the Fed­er­a­tion project, now mine, locat­ed near the Hera mine, and Great Cobar, locat­ed in the vicin­i­ty of the peak mine, which is cop­per and gold. A real year’s objec­tive is to max­i­mize returns from its pro­duc­ing assets while advanc­ing its explo­ration and devel­op­ment projects to sus­tain and grow the busi­ness in the long term.

[00:29:58] Tony Kynas­ton: And that’s, that last sen­tence is prob­a­bly the key one here. So they have a his­to­ry, But they’ve been going since 2009, um, in the Cobar region of New South Wales, so kind of the Bathurst area and a bit fur­ther west, um, of New South Wales. Uh, they have a his­to­ry of buy­ing mines or start­ing mines that have a short, uh, life left in them or a short life expectan­cy, but before they, Um, close them down, they, they drill like bug­gery and find anoth­er mine in the same area.

[00:30:31] Tony Kynas­ton: Uh, so it’s basi­cal­ly using the, the mine life of the mine that’s oper­at­ing to fund the explo­ration to get a, hope­ful­ly a big­ger and bet­ter deposit under­way. Um, they start­ed in 2009, uh, with the, the Hero Mine. The Hero Mine was actu­al­ly shut last year, or in late 2023, so that kind of gives you an idea of their, life cycle.

[00:30:58] Tony Kynas­ton: And some peo­ple will find that to be risky, and I guess it is, and they look for mines with long life cycles. So if you’re in that kind of camp, then Aure­lia may not be for you. They found in the area the Fed­er­a­tion deposit, and they’ve now devel­oped that into a mine. And they also, in 2020, acquired the Dar­gues mine from a com­pa­ny called Diver­si­fied Min­er­als.

[00:31:22] Tony Kynas­ton: Dar­gues gave them a bit of an indi­ges­tion prob­lem, and, um, If you look at the share price graph, it, it went from a high in, uh, about, um, 47 cents in 2022 to a low of 9 cents in Sep­tem­ber, 2023. And that crash began in 2022 with the release of their results, which showed a, a non cash write off of about 95 mil­lion after tax, uh, result­ing in a statu­to­ry loss of 81 mil­lion after tax that year.

[00:31:56] Tony Kynas­ton: And the write down was due to the acqui­si­tion of Dar­gues mine not work­ing out as planned. Um, I guess prob­a­bly amongst a few oth­er things, but that was main­ly it. Notwith­stand­ing that impair­ment charge, um, the under­ly­ing prof­it decreased, and that was large­ly due to low­er ore grades increas­ing the cost of sales.

[00:32:14] Tony Kynas­ton: So, basi­cal­ly they bought a mine, they thought it was going to have a cer­tain con­cen­trate of gold, it did­n’t, it had less as it con­tin­ued to be mined, and they not only made less mon­ey, but were forced to write down the cost of acquir­ing that mine. So that’s, I guess, one of the risks of what they’re doing.

[00:32:31] Tony Kynas­ton: It’s that kind of neces­si­tat­ed the change in man­age­ment. And in 2023, new man­age­ment came in. They under­took var­i­ous Projects to reduce costs in the busi­ness and, um, get the finances under con­trol. Debt was paid down to zero and, uh, the new incom­ing CEO secured a hun­dred mil­lion dol­lar fund­ing facil­i­ty, which allowed them to devel­op the Fed­er­a­tion mine.

[00:32:59] Tony Kynas­ton: And Stock­hand was kind of like that. And so they start­ed increas­ing their con­sen­sus fore­casts, and now the stock is being re rat­ed. Um, I did the analy­sis at, uh, I think 19 cents a share, so it’s up from 7 to 19 cents in the last 12 months or so, which is, you know, near­ly tripling, or, yeah, almost a tripling in val­ue.

[00:33:20] Tony Kynas­ton: Um, but, but all these things are large­ly on the strength of, What’s going to hap­pen, you know, what, what is going to hap­pen with the Fed­er­a­tion mine, what’s going to hap­pen with the drilling, the resources. So this is, I mean, this is, um, almost like a sto­ry stock, which we try and avoid. Um, I guess under­pinned by the fact that what they are doing throws off lots of cash, even though I think, um, the lat­est results in 2024 showed they were still at a slight loss in terms of prof­it after cash, uh, and prof­it after tax, sor­ry.

[00:33:53] Tony Kynas­ton: They are throw­ing off lots of cash. Cash. Oper­at­ing cash flow. So that’s good. And that’s fund­ing their explo­ration. So, they seem to have, um, that work­ing well for them. Um, if I look at the, the num­bers. The a DT for this stock is 200 and, uh, $38,000 a day. So it, it’s, it’ll suit a lot of investors, um, par­tic­u­lar­ly with port­fo­lios up to about sev­en 50,000 or so.

[00:34:21] Tony Kynas­ton: Uh, stock prices, I said before, I’m using for analy­sis of 19 cents and it did drop overnight, but it’s almost back at that price today. Last time I checked before we start­ed record­ing, um, but that 0. 19 is only 76 per­cent of the con­sen­sus price tar­get. So, um, I think the con­sen­sus price from mem­o­ry was around 0.

[00:34:40] Tony Kynas­ton: 26. So the ana­lysts are buy­ing into the sto­ry, um, and like what they’re see­ing and say­ing the stock is under­priced. Uh, we can’t, I can’t cal­cu­late IV1 because we’re not get­ting a, Um, a pos­i­tive earn­ings per share, but IV2, the fore­cast earn­ings per share is 19 cents, which is where the price trades now. So, um, it’s cer­tain­ly meet­ing our val­ue met­ric from that point of view, and it’s also meet­ing it from a book val­ue point of view.

[00:35:07] Tony Kynas­ton: So, net equi­ty per share and tan­gi­ble assets for this com­pa­ny are both around 19 cents. So we can buy it. For a rea­son­able price, the ques­tion is, you know, is it with­out risk? And there are risks because they’d rather do what they say they do, basi­cal­ly. The mit­i­ga­tion of that risk is that there’s a lot of cash behind them and no debt, so that’s good.

[00:35:27] Tony Kynas­ton: Stock Doc­tor finan­cial health is ear­ly warn­ing. Uh, and the trend is steady, so we can’t score them for finan­cial health. Stock­o­pe­dia, um, ranked it as 89, in terms of qual­i­ty, and give it an F score of 5 out of 9, so kind of sim­i­lar finan­cial health rat­ing in Stock­o­pe­dia for that. Um, there’s no div­i­dend being paid, so we can’t score it for that.

[00:35:51] Tony Kynas­ton: Uh, oh sor­ry, get­ting back to Stock­o­pe­dia, the over­all rank­ing for this com­pa­ny is 99, so it’s very high up on the Stock­o­pe­dia rank, based on a high score for momen­tum, so they’re kind of track­ing the recov­ery in the share price. over the last 12 months and boost­ing its score because of that. Uh, PE ratio is um, NA, so we give it a score of zero.

[00:36:15] Tony Kynas­ton: We can’t score it based on that. How­ev­er, the Prop­Caf is only three, just over three times, 3. 1 times. So, um, I think what every­one’s see­ing is that, uh, the The loss­es after NPAT are almost back to zero and will prob­a­bly go pos­i­tive next time they report. Um, and the fore­cast earn­ings per share is to, um, is to increase by 700%.

[00:36:39] Tony Kynas­ton: So, um, if the fore­cast come off, then That’s, you know, going to be a good thing, but I can’t score it based on that fore­cast earn­ings per share because we don’t have a PE ratio to com­pare it to, and we check for growth over PE. Uh, there’s no own­er founder in the com­pa­ny, how­ev­er, there is a share­hold­er sit­ting on the board, um, own­ing 19.

[00:37:02] Tony Kynas­ton: 88%, a chap by the name of Franklin or Lin Brazil, or Brazil. I think he pro­nounces it, um, Queens­land Agri­cul­tur­al­ist, so I’m not sure what his, uh, knowl­edge of min­ing is, but one of the things I do note is that the Cobar region is smack bang in the mid­dle of farm­ing dis­tricts in New South Wales, so per­haps he’s come across it from that Um, but yeah, I give it a score of 2 because there’s a direc­tor with skin in the game.

[00:37:33] Tony Kynas­ton: Um, it’s, we score it for a recent 3 point trend­line uptrend. Equi­ty has not been con­sis­tent­ly increas­ing, so no score there. So total qual­i­ty score of 11 out of 15, or 73%, and a QAV score of 0. 23. So, yeah. Pret­ty high up on our buy list, prob­a­bly the high­est gold min­er on our buy list, and I, you know, gold is hav­ing its time in the cycle where it’s hit­ting new records almost every day, so being a gold min­er is not a bad thing.

[00:38:02] Tony Kynas­ton: What are the risks? And I’ll read again from their annu­al report. Um, they call it the Replace­ment of Deplet­ed Reserves Risk. Um, and they say the com­pa­ny must con­tin­u­al­ly replace reserves deplet­ed by pro­duc­tion to main­tain pro­duc­tion lev­els over the long term. Reserves can be replaced by expand­ing known ore bod­ies, locat­ing new deposits, acquir­ing new assets, or achiev­ing high lev­els of con­ver­sions from resource to reserve with improve­ment in pro­duc­tion costs.

[00:38:31] Tony Kynas­ton: Explo­ration is high­ly spec­u­la­tive in nature. And as such, the com­pa­ny’s explo­ration projects involve many risks and can often be unsuc­cess­ful. Once a prospect with min­er­al­iza­tion is dis­cov­ered, it may take sev­er­al years from the ini­tial dis­cov­ery phase until pro­duc­tion is pos­si­ble. As a result, there is no assur­ance that cur­rent or future explo­ration pro­grams will be suc­cess­ful.

[00:38:54] Tony Kynas­ton: There is a risk that deple­tion of reserves will not be off­set by dis­cov­er­ies or acqui­si­tions, or that divest­ment of assets will lead to low­er reserve bases. The com­pa­ny’s min­er­al base may be, may decline if reserves are mined with­out ade­quate replace­ment, and the com­pa­ny may not be able to sus­tain pro­duc­tion beyond the cur­rent mine life, based on cur­rent pro­duc­tion rates.

[00:39:15] Tony Kynas­ton: So that’s a pret­ty good sum­ma­ry of what hap­pened to them in 2022. Um, Which led to replace­ment of the man­age­ment team and hope­ful­ly they got the les­son and 2023 looked bet­ter for them. But yeah, that’s the case with this com­pa­ny. Um, they’re kind of on this tread­mill of buy­ing and devel­op­ing short term mine leas­es, um, get­ting them to pro­duc­tion, bring­ing in cash while quick­ly try­ing to find exten­sions or new com­pa­nies to acquire.

[00:39:44] Tony Kynas­ton: Uh, what else can I say? One thing to call out to peo­ple is that, um, the price is cur­rent­ly trad­ing 3 cents above the cur­rent sell price. So, just be aware of that. It won’t take much to turn the stock into a sell. Um, so be care­ful of that. On the upside though, as I said, gold price is doing real­ly well. Um, one of the issues though with this com­pa­ny is it’s, uh, uh, all in sus­tain­able costs.

[00:40:11] Tony Kynas­ton: So the cost of pro­duc­ing the oil, oil, under accept­ed account­ing stan­dards. Um, is cur­rent­ly sit­ting at 2, 035 Aus­tralian, which is down from 2, 300 the pri­or year. So that’s a good thing, but, um, 2, 000 is, even though it’s pro­vid­ing a good healthy mar­gin now, uh, is not the low­est of the cost curve. So if the gold, when, if the gold price does decline, com­pa­nies like this will be the first ones under pres­sure.

[00:40:41] Tony Kynas­ton: It’ll be the ones with, um. Uh, all in costs more like 1, 500, 1, 600 an ounce that will, um, last longer and be thought of bet­ter in the mar­ket because of their high­er mar­gins than a com­pa­ny like this. So, um, gold, the gold price being up is an upside. If it keeps going up, it’s, uh, it’s just throw­ing cash at a busi­ness like this because it’s all mar­gin for no extra work.

[00:41:03] Tony Kynas­ton: But when it does turn down, it will become a risk. So, uh, yeah. Have a look at Aure­lia Met­als. It’s been on our buy list for a while.

[00:41:12] Cameron Reil­ly: And in fact, I added it to one of the light port­fo­lios in April, 2024, at 16 cents, cur­rent­ly at 19 cents, accord­ing to my spread­sheet any­way. So it’s up about 21 per­cent since then. It’s been good. But, uh, my chart says the 3PTL is 18 cents. So

[00:41:31] Tony Kynas­ton: Oh, does it?

[00:41:33] Cameron Reil­ly: yeah, that’s

[00:41:34] Cameron Reil­ly: from when I ran it

[00:41:35] Tony Kynas­ton: close. Where did I look

[00:41:36] Cameron Reil­ly: it is very close.

[00:41:38] Tony Kynas­ton: Yeah,

[00:41:38] Cameron Reil­ly: I found an arti­cle about, uh, Lin Brazil. Lin Brazil.

[00:41:43] Tony Kynas­ton: Yep.

[00:41:43] Cameron Reil­ly: Uh, which is inter­est­ing. Let me see if I can, where the hell did that go? Oh, there it is. Um, this is from grain­cen­tral. com, June 2022. South­ern Queens­land mixed farmer, investor, and phil­an­thropist Franklin Lynn Brazil said he nev­er thought of him­self as the kind of bloke to become a mem­ber of the Order of Aus­tralia.

[00:42:10] Cameron Reil­ly: That’s an AM. He puts the AM in AMI. He received the title as part of the Queen’s Birth­day 2022 Hon­ours list. You, you got one of those yet, Tony?

[00:42:20] Tony Kynas­ton: No, that must have got lost in the mail. Takes a while for the mail to reach Cape Schanck. Yeah.

[00:42:27] Cameron Reil­ly: For

[00:42:27] Tony Kynas­ton: am an ordi­nary, I know I am an ordi­nary Aus­tralian male though, as one of my

[00:42:31] Cameron Reil­ly: Oh, right, right. I don’t think you’re ordi­nary, Tony. Not at all. Uh, for his ser­vice to med­ical research and to agri­cul­ture. It is a great hon­our, but now I’m gonna have to wear a tie, Mr. Brazil said. Nev­er saw myself in the mould of what­ev­er an AM is, and I nev­er envis­aged that I would get one.

[00:42:50] Cameron Reil­ly: You go and do what you have to do, and this is just some­thing that comes from it. Through hard work, good plan­ning and deci­sion mak­ing, and rarely turn­ing down an oppor­tu­ni­ty, Mr. Brazil pro­gressed from a small poul­try farm on the Queens­land NSW bor­der to own­ing four crop­ping prop­er­ties at Brook­stead and two cat­tle oper­a­tions at Goondi­win­di.

[00:43:10] Cameron Reil­ly: He can also boast mul­ti­ple stock mar­ket invest­ment suc­cess­es and the cre­ation of the Brazil Fam­i­ly Foun­da­tion, which con­tributes to many med­ical and sci­en­tif­ic research orga­ni­za­tions. Thank you Self described as not the typ­i­cal farmer, Mr. Brazil said he has always had a pas­sion for agri­cul­ture and rur­al life.

[00:43:31] Cameron Reil­ly: Farm­ing is a very sat­is­fy­ing occu­pa­tion because it is full of chal­lenges. Chal­lenges to do it bet­ter next year, to do as well as your neigh­bours, and the sat­is­fac­tion that you believe you can beat the chal­lenge.

[00:43:43] Tony Kynas­ton: He’s com­pet­i­tive.

[00:43:46] Cameron Reil­ly: Yes.

[00:43:47] Tony Kynas­ton: Prob­a­bly anoth­er bad addi­tion to the board too, giv­en that these mines oper­ate in farm farm­ing areas and there’ll always be con­tention for water rights, water usage, there’ll be con­tention for whether the land is being, whether the agri­cul­tur­al use of the land is being affect­ed by min­ing, all that kind of stuff, so could­n’t hurt to have a pas­toral­ist on the board.

[00:44:09] Cameron Reil­ly: And he has been involved in the Grains Research and Devel­op­ment Cor­po­ra­tion, the Queens­land Farm­ers Fed­er­a­tion, Queens­land Irri­ga­tors Coun­cil, and the Grains and Crop­ping Research Devel­op­ment Trust. One thing leads to anoth­er, and if you’re around, peo­ple tend to ask you to become involved with things, he said.

[00:44:27] Cameron Reil­ly: His wife, Bob­bie, also a recip­i­ent of the Order of Aus­tralia, she could­n’t A O, uh, who often took a lead­ing role in She was serv­ing as the Uni­ver­si­ty of South­ern Queens­land Chan­cel­lor from 2006 to 2014, the chair of the Aus­tralian Land Care Coun­cil and a direc­tor of the Con­damine Catch­ment Man­age­ment Asso­ci­a­tion.

[00:44:52] Cameron Reil­ly: So they’re busy. Busy

[00:44:54] Cameron Reil­ly: peo­ple.

[00:44:57] Tony Kynas­ton: hope­ful­ly they have time for board meet­ings of AMI. I’m

[00:45:01] Cameron Reil­ly: The big future is in Pulse Foods. We’ll be com­ing into a wider range of foods and ways to use it because every­one wants vari­a­tion. No one drinks only 4X beer any­more. The meat made from Pulse’s, plant based meat, there will be a future in that, he said. So there you go. Just

[00:45:18] Cameron Reil­ly: look­ing

[00:45:18] Tony Kynas­ton: sure about that. There’s a lot of, uh,

[00:45:20] Tony Kynas­ton: you know, a lot of com­pa­nies that were set up to, um, make plant based meat at all closed down again. I don’t think it real­ly took off. Yeah.

[00:45:32] Cameron Reil­ly: Yeah, well, I do think it’s prob­a­bly going to kick off at some point, but, um, I don’t know.

[00:45:38] Tony Kynas­ton: off once. Has­n’t kicked on. And under, under Trump’s Amer­i­ca, I can’t see it tick­ing on over there. Would you like a plant based burg­er, Mr. Pres­i­dent?

[00:45:49] Cameron Reil­ly: Yeah. Any­who, thank you for that, Tony. Um, that brings us to After Hours.

[00:46:00] Cameron Reil­ly: And I

[00:46:00] Tony Kynas­ton: before we do, no, no ques­tions this week. Come on, peo­ple.

[00:46:04] Cameron Reil­ly: We haven’t

[00:46:04] Cameron Reil­ly: had

[00:46:04] Tony Kynas­ton: there’s got to be,

[00:46:05] Cameron Reil­ly: We’ve had

[00:46:06] Tony Kynas­ton: I know,

[00:46:07] Cameron Reil­ly: We’ve

[00:46:07] Cameron Reil­ly: answered

[00:46:07] Tony Kynas­ton: of unan­swered ques­tions in the world at the moment. Sure­ly some­one can think of one to ask us.

[00:46:15] Cameron Reil­ly: True. Uh, well I want­ed to start After Hours with an RIP for Mar­i­anne Faith­ful, who passed away this week. Are you a Mar­i­anne Faith­ful fan?

[00:46:25] Tony Kynas­ton: Oh, look, not real­ly. Um, did­n’t dis­like her. Bro­ken Eng­lish was a great record. That’s prob­a­bly my,

[00:46:31] Tony Kynas­ton: um, yeah, my only sort of encounter with her. Yeah.

[00:46:36] Cameron Reil­ly: She did a record, uh, she’s done a cou­ple of records with Nick Cave slash PJ Har­vey slash War­ren Ellis. It’s a good album she came out with about 10 years ago, I think, that was half writ­ten with PJ Har­vey and half writ­ten with Nick. And they appear on the songs, which is real­ly good. And I think her last album, which came out only a year or two ago, uh, was with War­ren Ellis, sort of writ­ing and play­ing on

[00:47:06] Cameron Reil­ly: it.

[00:47:06] Tony Kynas­ton: I was­n’t

[00:47:07] Cameron Reil­ly: so she was part of that sort of, you know, enclave, part of the Nick Cave, PJ Har­vey, uh, extend­ed fam­i­ly. Um, Yeah, I was, I mean, a big fan of Bro­ken Eng­lish main­ly, but lis­tened to a lot of her stuff over the years. And there’s a great live, there’s a cou­ple of great live record­ings of her, but as she, you know, over the last 20, 30 years, but to hear her per­form Sis­ter Mor­phine live, For peo­ple who don’t know Mar­i­anne Faith­ful, she was Mick Jag­ger’s girl­friend in the six­ties.

[00:47:44] Cameron Reil­ly: The very first song that the, that Mick and Kei­th ever wrote. Um, tears go by, they wrote for her. She record­ed it first, then they did a record­ing of it. Sis­ter Mor­phine, she wrote with Mick after she had a drug over­dose. I think she OD’d on the way to Aus­tralia when he

[00:48:06] Cameron Reil­ly: was

[00:48:06] Cameron Reil­ly: com­ing to make

[00:48:07] Tony Kynas­ton: Nick was film­ing Nick Kel­ly. Yeah.

[00:48:08] Cameron Reil­ly: Yeah, she OD’d on the plane and then was in a coma in an Aus­tralian hos­pi­tal for like six weeks or some­thing.

[00:48:15] Cameron Reil­ly: And Sis­ter Mor­phine was writ­ten as a result of that. She record­ed a ver­sion and the Stones obvi­ous­ly did a ver­sion.

[00:48:21] Tony Kynas­ton: And you know her first words when she came out of the coma?

[00:48:24] Cameron Reil­ly: No.

[00:48:26] Tony Kynas­ton: Mick said some­thing like, Oh, I thought you were dead. And she said, Wild hors­es could­n’t drag me away.

[00:48:31] Cameron Reil­ly: That’s right, and that’s where Wild Hors­es came from, I had heard that sto­ry, yeah. But, and, and then as she got old­er, she was like, she was an actress too, made a lot of movies, she was in the Dune Reboot, the first Dune Reboot, as one of the Bene Gesser­it sis­ters, or the Rev­erend Moth­er, I think. But her voice was great.

[00:48:52] Cameron Reil­ly: She, she was a very attrac­tive woman, like very pret­ty, younger, and then as she got old­er, very, very attrac­tive, mid­dle aged and late aged woman, with a very posh British accent. But her voice was like, grav­el­ly voice. And when she sings Sys­tem Mor­phine live, it’s chill­ing, like, uh, real­ly, real­ly chill­ing.

[00:49:17] Cameron Reil­ly: Any­way, and then Why’d You Do It off Bro­ken Eng­lish, and Bro­ken Eng­lish, the title track of that, just, you know, like a real­ly great per­for­mance, did a lot of sort of, um, um, Who’s the Ger­man, um, guy that Bowie and Kurt Weill, like a lot of Kurt Weill type songs, you know, that sort of Ger­man Berlin the­atri­cal sort of stuff with her, you know, Sort of the­atri­cal per­for­mances of it.

[00:49:56] Cameron Reil­ly: Yeah. Any­way, real­ly good. I’ve been, so I’ve been going back and lis­ten­ing to a lot of her stuff over the last week. What about you?

[00:50:06] Tony Kynas­ton: what I can report is Jen­ny and I have loved watch­ing the series of Rogue Heroes. Have you seen that one on SBS on demand?

[00:50:12] Cameron Reil­ly: No, what’s that about?

[00:50:14] Tony Kynas­ton: Uh, it’s about the his­to­ry of the SAS. in,

[00:50:17] Cameron Reil­ly: Oh, okay.

[00:50:19] Tony Kynas­ton: in, uh, Libya and World War II. And, you know, it’s, it’s a sort of stock stan­dard war thing, but it’s got the most amaz­ing sound­track and it’s real rock and roll, fight­ing, swear­ing.

[00:50:32] Tony Kynas­ton: It’s, it’s a lot of fun. It’s great. Any, any series that, um, you know, races jeep through the desert to high­way to hell by ACDC and, um, I fought the law by the clash. It’s just great.

[00:50:44] Cameron Reil­ly: So not peri­od tracks.

[00:50:47] Tony Kynas­ton: Well, it inter­spers­es them so you’ll have like a scene in a bar in Cairo and I’ll play Noel Cow­ard and then they’ll cut to Motor­head or,

[00:50:57] Tony Kynas­ton: uh, or some­thing sim­i­lar. It’s just fan­tas­tic. Real­ly well

[00:51:02] Cameron Reil­ly: Okay.

[00:51:03] Tony Kynas­ton: Great act­ing.

[00:51:04] Cameron Reil­ly: out.

[00:51:05] Tony Kynas­ton: Yeah.

[00:51:07] Cameron Reil­ly: I, I been watch­ing Inland Empire again for the first time in 20 years.

[00:51:14] Cameron Reil­ly: I’m about

[00:51:15] Tony Kynas­ton: that the most inac­ces­si­ble of David Lynch’s

[00:51:19] Cameron Reil­ly: I think, yes, quite famous­ly, the most inscrutable of Lynch’s films, and delib­er­ate­ly so, and I’m lov­ing it. Just

[00:51:30] Tony Kynas­ton: Oh, okay.

[00:51:31] Cameron Reil­ly: oh, I’m lov­ing it. It’s like just three hours of a night­mare that makes no sense, but the per­for­mances in it are ter­rif­ic.

[00:51:41] Cameron Reil­ly: You know, the actors and actress­es in it had no idea what was going on. Lau­ra Dern, I’ve writ­ten an inter­view with Lau­ra Dern say­ing that, I think she was inter­viewed when it was pre­mier­ing at the Venice Film Fes­ti­val or some­thing, and she said, I can’t wait to see it to find out what it’s about. She said she, her and um, Justin Ther­oux, the male lead in it, would sit around in between scenes try­ing to fig­ure out what the hell the film was about.

[00:52:07] Cameron Reil­ly: They had no idea when they were mak­ing it. Grace Zabriskie, you know Grace Zabriskie? She was Lau­ra Palmer’s moth­er. She only has a small role in it in one of the ear­ly scenes. As some Pol­ish woman, sounds like she’s from Tran­syl­va­nia, who’s just telling Lau­ra Dern these weird, chill­ing sto­ries, but her per­for­mance is like it’s over the top, but it’s mar­vel­lous, and it was all shot on a dig­i­tal handy­cam, it looks grainy, which makes it kind of looks like a home movie kind of

[00:52:40] Tony Kynas­ton: hmm, I found that real­ly hard to watch after a while.

[00:52:45] Cameron Reil­ly: I love it. Like, it’s harsh. The light­ing’s harsh. The sound is harsh. The, the, the qual­i­ty, the video is harsh. It just adds a harsh­ness to the whole thing, which is part of the effect of it, I think. But it was his last fea­ture film that he made, and it was like, 19 years ago

[00:53:03] Cameron Reil­ly: that

[00:53:03] Cameron Reil­ly: he

[00:53:03] Tony Kynas­ton: I know,

[00:53:05] Tony Kynas­ton: strange isn’t it, real­ly,

[00:53:07] Cameron Reil­ly: you know, it’s one of those things, like one of the tragedies I think of the Amer­i­can, you know, the Hol­ly­wood regime is the great genius­es like him, like Orson, strug­gle to oper­ate in it.

[00:53:22] Cameron Reil­ly: You know, it’s like, you know, your Scors­ese’s even strug­gle these days. Taran­ti­no gets away with it, but, uh, a lot of these auteurs have real­ly strug­gled to,

[00:53:32] Tony Kynas­ton: Cop­po­la.

[00:53:34] Cameron Reil­ly: fund­ing. Yeah, Cop­po­la, yeah. They have to raise mon­ey in Europe or raise it them­selves, fund it them­selves. I think he fund­ed Inland Empire him­self.

[00:53:43] Cameron Reil­ly: Any­way, I’ve been enjoy­ing that and I’ve also been read­ing Sailor and Luna, Bar­ry Gif­ford’s book, that Wild at Heart was based on. You

[00:53:49] Cameron Reil­ly: ever read

[00:53:50] Tony Kynas­ton: Ah, I haven’t, no.

[00:53:52] Cameron Reil­ly: It’s great. It’s just short, like short chap­ters. Each chap­ter’s only a few pages long. Sor­ry, my wife is try­ing to knock my lap­top off the table here. She’s walk­ing around.

[00:54:04] Cameron Reil­ly: Um, uh, yeah, real­ly good. I mean, it, you know, just cap­tures, well, Wild at Heart, the film, just cap­tured the char­ac­ters in the book real­ly well, I think. What else? Oh, PJK,

[00:54:17] Tony Kynas­ton: Yes,

[00:54:18] Cameron Reil­ly: about off air. For peo­ple who did­n’t see it, it’s in the Finan­cial Review, some state­ments from our for­mer Prime Min­is­ter.

[00:54:28] Cameron Reil­ly: Don­ald Trump believes in Amer­i­can nation­al­ism, but he does not believe in Amer­i­can inter­na­tion­al­ism, Keat­ing says. Nor does he buy the idea of Amer­i­can excep­tion­al­ism, the idea that Joe Biden, Hillary Clin­ton, and George W. Bush were glued to. That, in some way, they had God’s ear, and that their job was the Prime Min­is­ter.

[00:54:46] Cameron Reil­ly: Prop­a­ga­tion of the faith, the val­ues of their excep­tion­al state. Trump’s street smart­ness tells him this is non­sense. Though he lacks an ana­lyt­ic frame­work, his intu­ition push­es him past crude U. S. pol­i­cy dressed up as some rules based order. He knows the key U. S. rule is snatch and grab, a pol­i­cy he under­stands and is okay with.

[00:55:07] Cameron Reil­ly: But will not eulo­gize Trump’s pres­i­den­cy could be cen­tral to him. Engi­neer­ing avoid­ance of a third world war, which the Democ­rats in their man­ic com­mit­ment to pri­ma­cy were oth­er­wise slid­ing towards using Ukraine from 2014 as a US sur­ro­gate to con­tain Rus­sia and their mere­ly. Claim that Chi­na rep­re­sent­ed a mil­i­tary threat to the Unit­ed States, when in fact Chi­na intends to attack no oth­er states, cer­tain­ly not the us Chi­na’s objec­tion to for­eign mil­i­tary assets in its near waters being no dif­fer­ent to US intol­er­ance of for­eign mil­i­tary assets in the West­ern hemi­sphere.

[00:55:47] Cameron Reil­ly: I think Trump under­stands this. His vice pres­i­dent, JD Vance cer­tain­ly does hard to dis­agree with PJK

[00:55:56] Tony Kynas­ton: he speaks the truth yet again. It is, it is hard to dis­agree with him, isn’t it?

[00:56:02] Cameron Reil­ly: Why, why don’t, why isn’t he still our PM?

[00:56:06] Tony Kynas­ton: I know,

[00:56:08] Tony Kynas­ton: yeah, I agree.

[00:56:10] Cameron Reil­ly: know. Apart from, you know, all of the non­sense and bull­shit that come out of both of our major par­ties here about Israel or Ukraine or the US or Chi­na. It’s just embar­rass­ing on every front how pathet­ic our major polit­i­cal par­ties are. Yeah.

[00:56:30] Tony Kynas­ton: Well, and also too, I think, in terms of at least the mod­ern scene, it’s, politi­cians have worked out they can wage a cul­ture war and it does­n’t cost any­thing. Does­n’t affect the bud­get, does­n’t affect the econ­o­my, does­n’t cost them any­thing. So I just. That’s where they focus all their atten­tion. Now the cul­ture wars on DEI, which is a, you know, it’s an impor­tant issue for some peo­ple, but it’s very periph­ery to every­thing else that’s going on.

[00:56:58] Tony Kynas­ton: But, you know, politi­cians know if we argue about DEI, they won’t notice us not car­ing about Chi­na or the Mid­dle East or what­ev­er. So it’s, it’s, it’s a cost free dis­trac­tion.

[00:57:10] Cameron Reil­ly: Dis­trac­tions.

[00:57:11] Tony Kynas­ton: Yeah.

[00:57:12] Cameron Reil­ly: I also saw in the news this, uh, yes­ter­day, I guess, that, um, the Trump admin­is­tra­tion was sort of going after USAID, uh, not shut­ter­ing it entire­ly, but throw­ing some span­ners in the works. Um, Musk called it a crim­i­nal orga­ni­za­tion and said, it’s time for it to die. And Trump said it’s been run by a bunch of rad­i­cal lunatics and we’re get­ting them out.

[00:57:39] Cameron Reil­ly: We’re get­ting them out and then we’ll make a deci­sion. And again, uh, I have to agree with both of them. I mean, any­one who’s Stud­ied, uh, late 20th cen­tu­ry, ear­ly 21st cen­tu­ry his­to­ry of the CIA and its involve­ment in the over­throw of gov­ern­ments around the world knows that USAID and the Nation­al Endow­ment for Democ­ra­cy, its sis­ter orga­ni­za­tion, the NED, is basi­cal­ly used to over­throw democ­ra­cies in coun­tries.

[00:58:14] Cameron Reil­ly: That’s the way that the U. S. fun­nels mon­ey into coun­tries with gov­ern­ments where they want to bring about regime change, and then they use it to fund, uh, re rebel­lions, to, to fund, you know, media, to fun­nel cash that, because the CIA has a lot more eye­balls on where it’s going. Cash goes since some of the reforms in the 70s, uh, these aid orga­ni­za­tions and USAID was set up by Kennedy specif­i­cal­ly to do this as a regime change oper­a­tion in places like Cuba.

[00:58:53] Cameron Reil­ly: Um, yeah, I agree with him that it is a crim­i­nal orga­ni­za­tion, but then Musk said it was run, run by rad­i­cal left­ists. And I’m like, well, actu­al­ly, no, it’s usu­al­ly, they’re usu­al­ly tar­get­ing left­ist gov­ern­ments and try­ing to install ultra right wing gov­ern­ments in these coun­tries. But get­ting rid of

[00:59:15] Tony Kynas­ton: is that this,

[00:59:16] Cameron Reil­ly: would be a good thing.

[00:59:17] Tony Kynas­ton: is that the secret part of the USA that they would­n’t let? Doge, go into and inves­ti­gate.

[00:59:23] Cameron Reil­ly: yeah, yeah, yeah, absolute­ly. There’s, you know, there’s prob­a­bly not a lot of a paper trail there either, I assume. It’s like When the Pen­ta­gon shuf­fles bil­lions of dol­lars to places like Afghanistan and Iraq and then it all just dis­ap­pears and they get audit­ed and they go, receipts? What receipts? We did­n’t have time for receipts.

[00:59:43] Cameron Reil­ly: Too busy. Too busy to get receipts. I’m sure USAID has a sim­i­lar mod­el. Um, I told you about this video which I’ll rec­om­mend to every­one. Richard Wolff, The Econ­o­mist, W. O. L. L. F. Uh, I was watch­ing this on YouTube last night while I was prac­tic­ing my side­kicks in the kitchen, um, and stretch­ing. Uh, he, he, he, he, he is real­ly good, um, his take­down of tar­iffs and just Amer­i­ca in gen­er­al.

[01:00:14] Cameron Reil­ly: He starts, he’s talk­ing to an Amer­i­can audi­ence and he says, What? You know, this is what an empire looks like when it’s in decline, but you don’t know that the US is in decline because none of our politi­cians can say that out loud. They all keep pre­tend­ing that every­thing’s going great, but real­ly this is an empire in decline.

[01:00:32] Cameron Reil­ly: If you study his­to­ry, you know what it looks like, you can see the signs, but um, no one’s pre­pared to admit that.

[01:00:40] Cameron Reil­ly: Yet,

[01:00:40] Cameron Reil­ly: we’re

[01:00:40] Tony Kynas­ton: Well, Trump has. He wants to make Amer­i­ca great again.

[01:00:45] Cameron Reil­ly: I guess, yeah, there is that. What else have I got? Uh, that’s it. Oh, Dog’s Heart. You ever read any Mikhail Bul­gakov? Mas­ter and Mar­gari­ta? Oh, one of the great­est, uh, Sovi­et authors, Russ­ian authors from the ear­ly 20th cen­tu­ry.

[01:01:06] Cameron Reil­ly: His clas­sic is Mas­ter and Mar­gari­ta, which I read, I’ve read sev­er­al times, but over the last, 30 years. Um, it’s basi­cal­ly about the dev­il turn­ing up in Moscow, uh, in the ear­ly part of the Sovi­et era and just caus­ing hav­oc against all of the Sovi­et bureau­crats that are annoy­ing. The dev­il get­ting in there and, and Mess­ing up their lives.

[01:01:31] Cameron Reil­ly: It was banned in the Sovi­et Union. And, you know, I don’t think it got pub­lished in Rus­sia until like the 90s, but it was avail­able in the West from the 60s onwards. Real­ly fun­ny, dark, dark, fun­ny book. But one of the, there’s a Russ­ian guy at Kung Fu, we got talk­ing about. 20th cen­tu­ry Russ­ian music and lit­er­a­ture and Bul­gakov.

[01:01:51] Cameron Reil­ly: And he said, have you read A Dog’s Heart? I was like, no, he goes, you got to read A Dog’s Heart. So I just read that. It was writ­ten in about 26, 25, 26 by Bul­gakov, again, nev­er, not pub­lished in the Sovi­et Union, but, uh, it’s a novel­la. It’s a novel­la about a bril­liant. Uh, Moscow Sur­geon, who, as an exper­i­ment, gets a stray dog off a street, and takes out its Um, glands, and it’s heart, and it’s tes­ti­cles, and replaces them with human tes­ti­cles and glands and a heart from a recent­ly deceased corpse, just to see what would hap­pen, and the dog starts turn­ing into a human.

[01:02:46] Cameron Reil­ly: And, uh, caus­ing prob­lems. It’s this sur­re­al­ist, twist­ed, dark, dark­ly fun­ny sto­ry. It’s, it’s, but it’s all set inside of a cri­tique of the Bol­she­viks. Um, and this dog starts to become a, A Bol­she­vik. Um, it’s a fierce crit­i­cism of Bol­she­vism by Bul­gakov. Any­way, um, I can high­ly rec­om­mend that. Very, very fun read.

[01:03:18] Cameron Reil­ly: That and Mas­ter and Mar­gari­ta, two great books if peo­ple haven’t read them. And then I’m also read­ing, yeah, sor­ry,

[01:03:26] Tony Kynas­ton: No, I was going to say, I start­ed read­ing Al Paci­no’s biog­ra­phy last

[01:03:32] Cameron Reil­ly: I start­ed that, I kind of got bored with it after a while, you know, yeah. Some of his child­hood sto­ries were inter­est­ing, par­tic­u­lar­ly about the boys that he ran with and how they sort of got them­selves into trou­ble and act­ing, and his moth­er is what sort of saved him.

[01:03:49] Tony Kynas­ton: Yeah. Shar­ing a flat with Mar­tin Sheen in the ear­ly days.

[01:03:54] Cameron Reil­ly: I don’t think I got up to that bit, I sort of got dis­tract­ed. Yeah, I kind of, I want to read it. Uh, I was, I am read­ing, the oth­er book I’m read­ing at the moment is The War That Hitler Won by Robert Hertzstein. It’s basi­cal­ly about Goebbels and the inven­tion of pro­pa­gan­da, real­ly, I guess. One of the found­ing fathers of mod­ern pro­pa­gan­da.

[01:04:19] Cameron Reil­ly: And, um, how Goebbels was a mas­ter of that, real­ly, from the late 20s onwards. How he used pro­pa­gan­da and, you know, devel­oped a very, very effec­tive sys­tem of,

[01:04:35] Tony Kynas­ton: Still study­ing in mar­ket­ing class­es today.

[01:04:39] Cameron Reil­ly: yeah. You know, Goebbels, you know, fas­ci­nat­ing char­ac­ter. Like, he was, as this guy says, he was every­thing the Nazis hat­ed. He was an intel­lec­tu­al, he was weak, he had a dis­abil­i­ty, he, you know, was not the best. By any means, like some sort of Aryan Super­man, but he was, he under­stood mythol­o­gy and how to sell the Ger­mans on this vision of Ger­man suprema­cy, Aryan suprema­cy, and how to tar­get the Jews and the gyp­sies and the com­mu­nists and et cetera, et cetera, so.

[01:05:23] Cameron Reil­ly: It’s inter­est­ing, you know, doing a deep dive on Nazi pro­pa­gan­da in the 20s and 30s and draw­ing par­al­lels between that and what’s hap­pen­ing in the US and increas­ing­ly here as well and across Europe obvi­ous­ly with the AFD in Ger­many and Le Pen in France and the

[01:05:47] Tony Kynas­ton: Yeah, I mean, it’s not going to be, look, it’s not hard, it’s not going to be a stretch to see Peter Dut­ton adopt all of the cul­tur­al tac­tics that, uh, were suc­cess­ful for Trump.

[01:05:59] Cameron Reil­ly: Yeah, yeah, so any­way,

[01:06:04] Tony Kynas­ton: What was the joke I heard, or read, like, recent­ly about, um, Musk and Trump talk­ing about putting tar­iffs on Europe, and Trump says, Yeah, we should bring in less­er of those things from Europe, and Trump, and Musk goes, Führer? No, Fuhrer? And Trump goes, Shhh, don’t call me that yet.

[01:06:30] Cameron Reil­ly: oh that’s good, that’s bet­ter than the joke a guy told me at Kung Fu today. Do you know why a meat pie in Cuba costs 9. 20 but the same pie in the Caribbean costs 10. 50?

[01:06:46] Tony Kynas­ton: No.

[01:06:46] Cameron Reil­ly: due to the pirates of the Caribbean.

[01:06:54] Tony Kynas­ton: Oh dear.

[01:06:55] Cameron Reil­ly: And with that,

[01:06:56] Tony Kynas­ton: Yeah. Yeah, peo­ple bet­ter think up some ques­tions for next week, oth­er­wise we’ll start, we’ll start walk­ing out all our dad jokes.

[01:07:05] Cameron Reil­ly: doing, doing standup rou­tines. QAV a good week, Tony.

[01:07:10] Tony Kynas­ton: Thank you, Keir. You too.