QAV 820 — Wet Lettuce Watchdogs

 

[00:00:00]

Cameron: If I was try­ing to bait you, I would’ve pressed record and then start­ed talk­ing about the end of the coali­tion. Tony, just as we went to air, coali­tion, the Fed­er­al coali­tion in Aus­tralia has, uh, announced it’s get­ting a divorce. So, uh, who are the, who are the kids exact­ly in this

TK: Yeah. I

Cameron: sit­u­a­tion? So we were just pos­ing the ques­tion, is Peter Dut­ton the man who killed the coali­tion, or is Albo the man who killed the coali­tion?

What do you think? Tony Eson

TK: proud or Barn­a­by Joyce, the man who

Cameron: or Susan Lay, I mean, yeah, the man. She a man.

TK: turned on? No, I turned on, uh, News for a Laugh the oth­er day after the elec­tion and, and they were crit­i­ciz­ing Susan Lay for hav­ing two S’s in her name. That was the biggest crit­i­cism they could have of it.

Cameron: Oh dear.

TK: Yeah.

Cameron: So what does it mean? What does it mean for investors? Tony? I.

TK: Absolute­ly nothing.[00:01:00]

Cameron: Oh, you need some new lines.

TK: It prob­a­bly, it prob­a­bly means that that awful super­an­nu­a­tion tax on unre­al­ized gains will go through because there’s no block of

Cameron: Awful. You, you, you haven’t come around

TK: no,

Cameron: since the last week.

TK: not at all. I just don’t see how you can tax unre­al­ized gains ever. It’s I earn a block of land in my super fund and that’s my only asset, even though the land keeps going up, if I don’t have an income to pay the tax, even­tu­al­ly I’m gonna owe the tax office too much mon­ey and I’m forced to sell the land and pay them.

That’s not, that’s not how tax works. I can’t think of any­where else in the world that tax­es on unre­al­ized gains. You tax on income or you tax on cap­i­tal gains after the trans­ac­tion. Um, yeah.

Cameron: their argu­ment though, peo­ple are just bury­ing stuff in super and uh, mak­ing extra­or­di­nary prof­its out of what was sup­posed to be a tax break to help retirees, and they’re just [00:02:00] milk­ing it.

TK: That’s a valid point. And that’s the oth­er, that’s, I’m not, I don’t like the tax on ga on cap­i­tal in your super over 3 mil­lion bucks on bal­ances. Over 3 mil­lion bucks. But, um, it’s inevitable. I always thought super would get taxed more than what it was soon as the gov­ern­ment runs out­ta mon­ey. Um, and the rea­son I don’t like that is not that it, you know, um, it’s a tax that I’ll have to pay, but it’s, uh, it’s a, it’s a, you make your deci­sions on super­an­nu­a­tion decades in advance of need­ing it, and then to have the rules changed.

In the, you know, in the next 12 months based on all the sav­ings you’ve accu­mu­lat­ed is wrong. should be a, there should be a sun­rise clause on that kind of tax to supers, you know, so in 10 years time it comes in. So any­body who, every­body can then make a, a, a valid deci­sion about whether they can con­tribute or not.

’cause you can’t get it out until you retire and take it out. But you’ve had to pay tax by then. So that’s why I don’t like that side of it, but I think it’s just, [00:03:00] I was gonna say philo­soph­i­cal­ly wrong, it’s eco­nom­i­cal­ly wrong to tax unre­al­ized gains because you can’t pay the tax and then you even­tu­al­ly you end up own­ing the tax offi­cer debt they’ll sue you and they’ll take the asset and then, um, it’s, that’s not how Tax­a­tion’s meant to work.

I accept that, I accept what you’re say­ing about peo­ple putting mon­ey into super, just as like they put it into trust in com­pa­nies. Peo­ple will always try and their asset growth and min­i­mize their tax­a­tion. That’s, that’s an accept­able part of tax­a­tion. I mean, the gov­ern­ment accepts that the, um, every­one accepts that.

Real­ly. Uh, so I, I don’t have a prob­lem with that. What I have a prob­lem with is that, um, is that you have, if you don’t, if you don’t have the abil­i­ty to pay the tax and you have to sell assets to do it, and you, if you only have one asset, you have to sell the whole thing to pay a, a minor tax bill. It’s, it’s, it’s wrong.

It’s actu­al­ly a bit unpro­duc­tive too. And that’s one thing I hope the gov­ern­ment does focus on going for­ward is pro­duc­tiv­i­ty. Um, and [00:04:00] tax­ing unre­al­ized gains is not pro­duc­tive. ’cause you’re hav­ing to, you’re trans­act­ing more than you need to,

Cameron: Well, I don’t dun­no if any com­ments on that.

TK: uh, what, what, wait for the next 20 years and your QIV bal­ances up and then you start get­ting taxed on, on it. See how you feel then.

Cameron: Yeah,

TK: just, just add it to your tax bill to the gov­ern­ment. You I’m pay­ing tax bill to the gov­ern­ment.

Cameron: yeah. Just add it on.

TK: Yeah.

Cameron: yeah, yeah. What are you gonna do?

TK: Take your assets.

Cameron: Ah, good luck. Take my good looks. It’s my only asset. It’s my good looks, my low, my low blood pres­sure. That’s my asset.

TK: Well,

Cameron: It’ll go

TK: start, the gov­ern­ment might start tax­ing that Camp

Cameron: my blood pres­sure.

TK: earn­ings off your good looks and then they’ll add to that because you’re gonna live longer ’cause you’ve got low blood pres­sure.

Cameron: Uh, my good looks haven’t earned me any­thing so far. I’m not sure it’s going to kick in my chil­dren’s good looks on the oth­er hand, maybe. [00:05:00] Um, alright, well let’s get into the,

TK: sor­ry, the oth­er macro thing that’s hap­pen­ing today, we spoke about the coali­tion break­ing up, but, uh, the RBA meets was, I think it’s meet­ing now, it should announce in about 15 min­utes and,

Cameron: I’ve got the finan­cial review open and wait­ing.

TK: okay. And I think the mar­ket’s con­sen­sus is a 25 basis points cut. So we’ll see.

Cameron: And what do you think that will do if it goes ahead?

TK: Uh, it’ll start to inflate the share mar­ket and the prop­er­ty mar­ket. So it’s, it’s far more impor­tant for us as investors than

Cameron: Hmm.

TK: what the coali­tion does in the, in the par­ty room.

Cameron: The oth­er big news in the last cou­ple of days is the Unit­ed States’ rat­ing,

TK: Hmm.

Cameron: and that, uh, had a bit of an impact on the US mar­ket. I think it had a lit­tle bit of an impact on the mar­ket here as well yes­ter­day.

TK: Fun­ny because we fol­low the us but um, yeah, I mean the, [00:06:00] it’s dropped a, dropped a rat­ing, uh, because of its debt lev­els in the US and uh, um, I think that’s fair. has been some alle­ga­tions that the per­son that. it was stan­dard and pause could have been Moody’s that did the rat­ing, was a, um, a nev­er Trumper, and then, and he decid­ed to drop it.

Uh, I don’t know if that’s true or not. Cer­tain­ly it’s, I think it’s jus­ti­fi­able objec­tive­ly giv­en the debt lev­els in the US and yeah. And it means that the US will get less for their bonds when they issue them in the future, which is less income to the gov­ern­ment and high­er debt costs. So prob­a­bly it does­n’t have a mean­ing­ful impact with one down­grade.

Uh, but um, and the amount of, you know, trea­suries, which are already in the mar­ket, but, uh, over time, and if it keeps, if the trend con­tin­ues, then the US is gonna be in trou­ble. And that’s

Cameron: Hm

TK: peo­ple like War­ren Buf­fet have been say­ing for years, or US has maxed out its cred­it card and now it’s gonna start hav­ing to pay inter­est on its inter­est even­tu­al­ly when, if things keep continuing.[00:07:00]

Cameron: mm. Well, I’m look­ing to see what impact the, uh, coali­tion divorce has had on the mar­ket today. Uh, noth­ing. Uh, it, when I opened up my lit­tle stock thing before, it did look like it had shot up, but, uh, now that’s gone away, so I dun­no what’s going on. Uh, speak­ing of stock mar­ket relat­ed or track­ing issues for club mem­bers that are using the stock his­to­ry ver­sion of the check­list, if you haven’t already picked this up, there’s a prob­lem with stock his­to­ry in Excel at the moment for some rea­son. And it’s not updat­ing has­n’t updat­ed for the last cou­ple of days, which is a bit of a prob­lem if, like me, you track every­thing using stock his­to­ry in Excel, includ­ing cell trig­gers and things like that. So, uh, I have been in touch with Microsoft on X and they’re gaslight­ing me telling me it’s my prob­lem.

But, uh, [00:08:00] Dar­rell Wood­man picked up that they found a thread on one of the Microsoft sup­port forums where there’s a whole bunch of peo­ple com­plain­ing about the same issue. No doubt Microsoft will tell us we’re all doing it wrong, but, uh, they, they’re still telling me, even though I point­ed them to the forum, they’re still sug­gest­ing I reboot Excel. I’m like, yeah, nah, it’s, it’s, it’s not me, it’s you. Any­way, we, um, that’s gonna cause a prob­lem until it gets fixed. Keep an eye on that in oth­er news.

TK: wait for AI to take over and have these glitch­es. Then you have

Cameron: Eight. No AI would, AI would have fixed it by now, Tony. It’d be all over it.

TK: did you read about the, the with Crock over the week­end?

Cameron: Yes.

TK: Yeah.

Any­way. No,

Cameron: Hmm.

TK: to argue with an AI call cen­ter about hav­ing prob­lems in Excel. It’s not, not us, bud­dy. It’s you.

Cameron: It’s, um,

TK: It’s you. bug

Cameron: [00:09:00] humans, humans are the argu­men­ta­tive ones. AI is unfail­ing­ly polite, wants to please. So far, whether or not it stays that way remains to be seen.

TK: hmm.

Cameron: Uh, when I did the check­list over the week­end, iron ore had become a buy and wheat had become a buy. I did­n’t see those things hap­pen­ing this week.

That’s, they weren’t on my bin­go card for this week.

TK: No, there was the coali­tion break­ing up.

Cameron: No, it’s true. So that means some of our iron, all stocks not. FMG because that still has a bad boy flag on it. But, uh, think FEX was a buy. I added FEX as a light buy pos­si­bil­i­ty yes­ter­day. And, uh, I think there was a cou­ple of oth­ers on our buy list this week. Let me just flick through. What have we got that’s iron ore relat­ed this week? Do, do, do, [00:10:00] do iron ore? Uh, come on Excel, wake up.

TK: Not a whole lot.

Cameron: Oh, FMG and FEX. That’s it. Alright. And FEX is a lit­tle bit small. 255,000 is its aver­age dai­ly trade. So too small for, uh, big swingers. But, uh, for the rest of us it’s uh. the buy list and is avail­able to be bought. See if you can ride the iron ore price up if it con­tin­ues to go up. What about wheat? Do we have any, do we have, we don’t have that many wheat plays.

TK: I

Cameron: Is it on the buy list?

TK: on the buy list. No, I just had a look and yeah,

Cameron: Yeah, that’s it. No wheat. All right, well that’s that. What have you got on your uh, bin­go card for today, Tony?

TK: saw a, saw an inter­est­ing arti­cle on the fin last week uh, was in the mar­ket sec­tion [00:11:00] and the head­ing was dis­clo­sure doozy insults, investors Intel­li­gence. I guess this is more along the lines of what we were say­ing dur­ing report­ing sea­son, that a strong a SX and with­out a strong as when the com­pa­nies are sort of, I guess, feel­ing the vibe and are get­ting worse at dis­clos­ing things, uh, when they should.

Um, and the one that this arti­cle talks about is Maine Farmer and it says, uh, where are we? Despite sit­ting on a locked and loaded $672 mil­lion takeover offer from a rep­utable enough suit­er farm­ers shares sat tanked 13% in the first two hours of trade yes­ter­day, this was last week, vol­ume was heav­ier than the nor­mal.

Well, the com­pa­ny had­n’t said any­thing blind, Fred­die could tell you some­thing was going on. Uh, so the A SX did step in at 1233 and paused main shares from trad­ing and send­ing it [00:12:00] a speed­ing tick­et. Is MYX aware of any infor­ma­tion con­cern­ing it that has not been announced to the mar­ket, which, if known by some of the mar­ket, could explain the recent trad­ing in secu­ri­ties?

That’s the stan­dard speed­ing tick­et from the A SX Main’s Answer. Noth­ing to see here, hang on. What about the 11 page, though? The main got from the US Food and Drug Admin­is­tra­tion on April 28, accus­ing it of mak­ing false or mis­lead­ing claims and pre­sen­ta­tions about the risk of its key growth.

Con­tra­cep­tive pill next, next Astel­las and pub­lished on the FDA web­sites, FDA’s web­site on Tues­day night, cetera, et cetera. So, um, yeah, it’s at least the A SX stepped in and pause the shares. But, uh, it’s, I think all the com­pa­nies need to go back to direc­tor school and just. Work out what’s mate­r­i­al and what’s not.

because, um, prob­a­bly repeat­ing myself, but I think that things could improve with dis­clo­sure on the A SX. This year it’s been [00:13:00] pret­ty, uh, uh, pret­ty, it’s been a low point I think, for my expe­ri­ence over the last 25 years and what com­pa­nies are say­ing and not say­ing when they should and should­n’t.

Cameron: What date is the arti­cle that you are read­ing?

TK: I don’t have it. Sor­ry. I think it was, Ooh, I’m gonna say Wednes­day or Thurs­day of last week.

Cameron: In the fin

TK: yeah. MFN I’ll try and look it up.

Cameron: I’ve got it. Um, yeah, so it was May 14th at 8:00 PM So I’ve, I’ve got open in front of me, main Farmer’s Response, which is also dat­ed the 14th of May to the speed­ing tick­et. it says, uh, is MYX aware of any infor­ma­tion con­cern­ing blah, blah, blah? Not­ing our response to ques­tion three.

Below, is not aware of any infor­ma­tion con­cern­ing it that has not been announced to the mar­ket. Then ques­tion three is, um, their response to that is MYX is aware that on the 12th of May, 2025 US time, the [00:14:00] US Food and Drug Admin­is­tra­tion pub­lished on its web­site an unti­tled let­ter received by Maine Farmer on the 28th of April, 2025 US time relat­ed to cer­tain pro­mo­tion­al claims used in a speak­er pre­sen­ta­tion for next Stel­las. MYX notes that the bid­der in rela­tion to the recent­ly announced s scheme of arrange­ment was made aware of the FDA Unen­ti­tled let­ter short­ly fol­low­ing its date of issue. And the FDA enti­tled let­ter was made pub­licly avail­able by the FBA on the Unti­tled let­ters sec­tion of its web­site On the 12th of May. MYX can only assume that the recent trad­ing is due to mar­ket spec­u­la­tion about the per­ceived impli­ca­tions of the FDA unti­tled let­ter being received by the com­pa­ny such as MYX view is that in and of itself, the FDA’s Unen­ti­tled let­ter is not mate­ri­al­ly price sen­si­tive. MYX con­firms that it has a near final­ized response to the FDA unti­tled let­ter, which it pro­pos­es to pro­vide to the FDA [00:15:00] with­in the pre­scribed time­frame.

Hav­ing said that, giv­en the mar­ket move­ment, MYX is com­fort­able mak­ing a fur­ther announce­ment to the mar­ket, address­ing spec­u­la­tion relat­ed to the FDA unti­tled let­ter. So, look, we knew about it.

TK: we got

Cameron: Some, peo­ple knew about it. It was on the FDA’s web­site. I mean, what else do you want us to do? I mean, if peo­ple aren’t read­ing the FDA’s Untold whether Unen­ti­tled Let­ters web­site sec­tion, that’s on them.

It’s not on us.

TK: Yeah. As I’m sure every Super­fund mem­ber in Aus­tralia does reg­u­lar­ly.

Cameron: First thing I read when I get up every morn­ing is the FDA’s Unti­tled let­ter sec­tion.

TK: And you got­ta search the body of it. ’cause you can’t, there’s no titles to search.

Cameron: No titles. It’s like, it’s like the uh, JFK files when they release those.

TK: Look. Yeah. So, um,

Cameron: That’s kind of a lame excuse. MYX, I’ve got­ta say.

TK: low.

Cameron: But here’s my ques­tion. And we’ve gone over this before. What are they [00:16:00] play­ing? I mean, what is the game here? They’re, they’re like you say, they’ve got­ta go back to direc­tor school, but they’re assum­ing they’re not dum­mies. They know what’s going on. know what they’re sup­posed to do. They’re not doing it. Why?

TK: And what’s the A SX doing about it? So

Cameron: Yeah.

TK: this arti­cle was from a week ago. The A SX has issued a speed­ing tick­et. Where’s the fine? They’ve issued a speed­ing tick­et. They paused their shares for a lit­tle bit.

Cameron: Hmm,

TK: what’s the fol­low up?

Cameron: hmm,

TK: fo there’s nev­er any fol­low up.

Cameron: hmm,

TK: Um, these direct, these direc­tors have admit­ted in that let­ter that you just read out, that there was mar­ket sen­si­tive infor­ma­tion on a unti­tled let­ter on an FDA web­site, which they then made avail­able or made aware to the bid­ders.

They mak­ing a bid for the com­pa­ny.

Cameron: hmm

TK: the mar­ket,

Cameron: hmm. Not the pun­ters at home.

TK: Yep. And I don’t have any skin in the game, so I was­n’t a share­hold­er in NYX, but it’s anoth­er exam­ple of how, um, the A SX is a, is, sor­ry, the ASIC or the As SX or both? Um, prob­a­bly the As SX, uh, in this case is just a wet let­tuce it comes to these things. The only good of what they’ve done is it did announce to the mar­ket that, Hey, you should look at this.

Look over here, look over here, and we’re gonna pause shares for a lit­tle bit while you do that. and it, and it got a con­fes­sion out of some, some­what of a con­fes­sion out of the direc­tors of, uh, par­tic­u­lar com­pa­ny. But, um, real­ly it’s, not good enough.

Cameron: So I’m just mak­ing wet let­tuce writ­ing that down as my episode [00:18:00] title for this week. Wet Let­tuce. Uh, yeah, it’s, it’s appalling. It’s almost as bad as uh, announc­ing. There’s, I dun­no if you saw this, but videos come out of the day that he announced that they were paus­ing the tar­iffs, not the Chi­na tar­iffs, but the pre­vi­ous. Tar­iff pause thing. Videos come out of him walk­ing through some­where, you know, hav­ing a qui­et tete with, uh, half a dozen guys that are stand­ing around him. Some cam­era dudes man­aged to record it where he said to them, yeah, I’m gonna make an announce­ment in a cou­ple of hours that we’re going to, you know, pause the tar­iffs, the mar­ket’s going to, mar­ket’s gonna, you know, shoot up.

It’s gonna be great. It’s gonna be fab­u­lous. He’s on cam­era. Tell guys, I guar­an­tee none of them went out and bought shares. Uh, of course they did. Of course. They being face­tious. Tony

TK: okay. Sor­ry.

Cameron: Yeah. Yeah. It’s just appalling. [00:19:00] Yeah. Any­way,

TK: Isn’t he being sued? I for­get now. How many hun­dreds of court cas­es against Don­ald Trump at the moment

Cameron: real­ly.

TK: And I read an, I read some­where that um, an arti­cle in the Wall Street Jour­nal, I think it was that one of his lawyers was in court in a very high court, I for­get now, which one it was in the us said, look, can rule what you like, judge.

The pres­i­dent may or may not agree with it and may or may not, um, com­ply with it.

Cameron: At least he’s being hon­est.

TK: Yeah.

Cameron: He may or may not to fox­es. Real­ly? I mean, yeah. No,

TK: Which again gives argu­ment to your cre­dence that there won’t be any more elec­tions in the US ’cause he’s only in that posi­tion of being able to not com­ply with courts. ’cause he’s the pres­i­dent of the us.

Cameron: yeah,

TK: Hmm.

Cameron: yeah. Some­body asked me ear­li­er today, some­body on Face­book said, who do you think the Democ­rats should put for­ward to run against him in 2028? I said, yeah, I don’t think it mat­ters, real­ly. [00:20:00] Yeah. Any who? Mov­ing right along. What else you got?

TK: Uh, just the pulled pork to do. I don’t know if you’ve got any oth­er ques­tions or any­thing you wan­na run through first.

Cameron: Well, I wan­na run through the Rich Zen­ner um, inter­view.

TK: Okay.

Cameron: So, I don’t know, uh, for folks out there, uh, who Dun­no, Tobias Carlisle, these are. I was gonna say for­mer Aus­tralian, still an Aus­tralian, he’s lived in Amer­i­ca for a long time, a cou­ple of funds, wrote a great book on val­ue invest­ing. He’s been on our show once or twice, is com­ing back on soon as I can lock him down. And he does a pod­cast called The Acquir­ers Pod­cast. It’s a val­ue invest­ing pod­cast. It’s real­ly great and I was lis­ten­ing to it. I don’t lis­ten to it very often, but, ’cause I don’t lis­ten to pod­casts very often. Too busy mak­ing the bloody things to lis­ten to them. But I was lis­ten­ing to one recent­ly, uh, recent episode, and he had a guy called Rich B. On P‑Z-E-N‑A, uh, uh, is the founder and chief invest­ment offi­cer [00:21:00] of PNA Invest­ment Man­age­ment, a New York based deep val­ue invest­ment firm with $34.9 bil­lion in assets under man­age­ment. And he got start­ed in the ear­ly eight­ies. Uh, peo­ple may recall, uh, peo­ple may know of Joel Green Blatt. I’m sure we’ve talked about him from time to time.

I think I actu­al­ly did reach out to him at one point, tried to get him on the show, but he is writ­ten a num­ber of great books, uh, about invest­ing, like the lit­tle book that beats the mar­ket and, uh, a bunch of oth­ers. Com­mon sense, uh, the investors, some­thing, some­thing, some­thing. He’s a suc­cess­ful val­ue investor over there. Uh, so he and Rich went to, I think it was Whar­ton, togeth­er School. And in 1981 they wrote a research paper how the small investor can beat the mar­ket. It was their mas­ter’s the­sis and they were try­ing to exam­ine the per­for­mance of secu­ri­ties that [00:22:00] were trad­ing at or below liq­ui­da­tion val­ue dur­ing the peri­od of 7 19 72 to 1978 in the us. Uh, I think they were kind of try­ing to update, uh, you know, the premise of Ben­jamin Gra­ham and, you know, try­ing to do some aca­d­e­m­ic analy­sis. Obvi­ous­ly, val­ue invest­ing was­n’t that pop­u­lar back then. Um, as it is still not that pop­u­lar now. Real­ly, I don’t think. But they,

TK: isn’t it?

Cameron: yeah. Yes. Although there were, I don’t know how many tens of thou­sands of peo­ple at the, uh, Berk­shire Hath­away, a GM the oth­er day, but, uh, they, they want­ed to, you know, put to test the the­o­ry that stocks that were trad­ing. Below their liq­uid at or below their liq­ui­da­tion val­ue with a low price to earn­ings ratio would whether or not they had out­per­formed the rest of the mar­ket. So they ran that, and fun­ni­ly enough, [00:23:00] they decid­ed that it did, they did on aver­age, beat the rest of the mar­ket. So it was a, um, study that ver­i­fied the basic premise that if they have a low price to earn­ings and they’re trad­ing around their intrin­sic val­ue that they tend to out­per­form.

TK: Does that

Cameron: So

TK: and I can go to Whar­ton Busi­ness School with the dum­my port­fo­lio and gain some MBAs?

Cameron: you, I think, uh, me, not so much unless I get an, I get,

TK: crib.

Cameron: it’s like I, the, uh, the, the award that Markham gave me in, in ino, my, my Napoleon­ic award, it was for not doing any actu­al research about Napoleon, just talk­ing about oth­er peo­ple’s research about That was all I got my, uh, Napoleon­ic medal for talk­ing about oth­er peo­ple’s hard work. Uh, so any­way, I want­ed to play, I’m gonna steal from this show, a cou­ple of clips ’cause I was lis­ten­ing to the whole thing going, oh, I wish Tony was here.

I wish I could tell, see what Tony thinks about that. And I thought, bug­ger it. I’ll just steal it. With full cred­it to Tobias [00:24:00] Carlisle, he’s i’ll, I’ll con­fess to it when he comes on the show uh, to Rich Pan­na. Um, hope­ful­ly these guys don’t get mind. I mean, it’s out there, it’s in the pub­lic. Oh, it’s not a pre­mi­um pod­cast or any­thing.

It’s freely avail­able on their YouTube. uh, let me play this first clip and I can’t remem­ber what this is about, but, uh, we’ll work it out as we go.

So I’ll tell you my, my sto­ry from 1999. um, we had start­ed in our busi­ness in 96 and we had a good first cou­ple years got to a break even and we were feel­ing good and then we went through this 10 straight quar­ters of mas­sive under under­per­for­mance com­pared to the broad mar­ket, and I had a. Client who came in, sat in our con­fer­ence room and she walks in the door and says to me, my grand­moth­er’s a bet­ter investor than you are, and [00:25:00] all you have to do is buy Cis­co. Every­body in the world has fig­ured this out except for you, and you’re just stub­born. Try to go through with her, with her. And I said, you real­ize that Cis­co is now at a half a tril­lion dol­lar val­u­a­tion first com­pa­ny to ever achieve that mark. Um, and you’re, you’re used to dou­ble dig­it returns. You, you, you would be unsat­is­fied with any­thing less than 15% a year. So if you bought that whole com­pa­ny for $500 bil­lion, they would have to earn $75 bil­lion a year for you to get your 15% return. And they earn one. don’t you think there’s some­thing wrong with that? And she just looked at me and said, you don’t get it, do you? To which I agree. I did­n’t get it. You’re right. I don’t get it. Um, and, you know, that was gonna be the back­bone of the inter­net. It was all just as excit­ing as, as it is today with arti­fi­cial intel­li­gence. Mm-hmm. [00:26:00] Um, and so, was that a very painful time for you, or was it like, it you just kind of rec­og­nize that, you know what, this is just crazi­ness and I know that the world will get back to real­i­ty at some point. No, I mean, when you’re, when you’re a strug­gling busi­ness that just treat prof­itabil­i­ty and now you, clients are telling you you’re an idiot and they start click­ing their accounts, we, we, um, weren’t sure we were gonna make it. And it, and in fact, Joel Green­blatt, who, who you men­tioned ear­li­er, that was my part­ner at Whar­ton in the, in our, in our lit­tle research project. Um, he was a backer, my backer in, in get­ting going in this busi­ness. And, um, we went in the red and I, and we got an offer from anoth­er firm to buy us. Mm-hmm. It would’ve got­ten all of us a job. Here was the deal. Joel could get his mon­ey back and we would all have a job. And I said, Joel, it [00:27:00] sounds like a real­ly good deal. should take it. Um, and Joel said, way. you need to make it through this peri­od, um, you have a blank check. Wow. That’s pret­ty much what he said. Incred­i­ble. Um, and he did­n’t ask for any incre­men­tal equi­ty in exchange for that. Now he must have real­ly pre­scient. ’cause that was in Feb­ru­ary of 2000 when that hap­pened. And 9th it turned around and he nev­er had to put anoth­er pen­ny. He nev­er had to put a pen­ny in.

I thought that was a great sto­ry. Like, uh, know, just reminds me, I was talk­ing to some­body the oth­er day, one of our QAV club mem­bers who got start­ed in ear­ly 2022 just as every­thing crashed with inter­est rate ris­es in Ukraine and you know, trade wars and all that kind of stuff. And um, and I was say­ing, [00:28:00] yeah, look, from my lim­it­ed expe­ri­ence with this, but also look­ing at Tony’s num­bers and lis­ten, read­ing buf­fet stuff over the years. Um. it works with QAV, I think, tell me if you dis­agree, but we have once every five to 10 years, have one real­ly, real­ly good year where we mas­sive­ly out­per­form the mar­ket. And then we have maybe anoth­er year that’s pret­ty good, but not as big as that one. Not like two, three times the mar­ket per­for­mance. three times, four times the mar­ket per­for­mance. And then the rest of the time it’s sort of a lit­tle bit bet­ter, lit­tle bit worse kind of, you know, aver­ages. Uh, aver­age per­for­mance, but you’ve got­ta be around for that one or two real­ly good years in the decade where the sys­tem real­ly out­per­forms and the rest of the time it’s sort of, you know, tracks along and, [00:29:00] you know, does­n’t revert to the meme, but goes back, that’s where the aver­age 20% comes from. Like in the six years we’ve been doing this, what­ev­er it is, we had that one real­ly good year, uh, dur­ing Covid real­ly kicked the num­bers up. And since then it’s been okay, like this year we’re up like, I don’t know, 30, 40% on the mar­ket. Cou­ple, you know, last cou­ple of years it’s been touch and go a lit­tle bit above, a lit­tle bit below, that one real­ly good year has put us in a good posi­tion for the long haul. it’s good. I, I like it when I hear guys like that are, they’re very suc­cess­ful, that had a cou­ple of real­ly, real­ly bad years, but they just stuck to the strat­e­gy and you know, luck­i­ly in their case, they did­n’t have to bail out green­blatt. Back, Tim. Hard to say. Green­blatt back back. Can you say green blatt back three times fast. You prob­a­bly can. ’cause you’re,

TK: black back three times fast.

Cameron: oh yeah. Very good. Yeah. Very clever.

TK: uh, yeah, no, I, I dun­no if I’ve ever thought about it that way. I just think of it as being [00:30:00] volatile. Um, if you’re a val­ue investor, you’ve got huge tail­winds. ’cause the, well, basi­cal­ly the way I look at it is the mar­ket tends to back growth stocks that’s when we tend to, some­times under­per­form or, or, i, I out­per­form a lit­tle bit, but it’s when the mar­ket goes, oh, okay, growth can’t go on for­ev­er.

That’s when the val­ue investors have a real­ly good run. So, yeah. Um, I dun­no if it’s every five years or six years, or two years or 10 years or what­ev­er, but, um, it’s more around things like the.com bub­bly burst­ing when, when the mar­ket wakes up to itself and comes to its sens­es, as, as Buf­fet used to say, when the tide goes out, can see who’s, you know, been swim­ming naked basi­cal­ly.

So it’s, it’s, that’s the. It’s it’s title. It’s like, it’s when the,

Cameron: Idol. Yeah,

TK: when the, when the tide goes out, when peo­ple say, hang on, you can’t, as that chap said on the, on the video, then you can’t, [00:31:00] you can’t have a mar­ket cap of half a tril­lion dol­lars and make $1 bil­lion year. That’s a very high price to earn­ings ratio.

May, may have been accept­able while you’re grow­ing, but as soon as you stop grow­ing, the mar­ket cap drops dra­mat­i­cal­ly to meet the earn­ings.

Cameron: I had­n’t, I had­n’t thought about Cis­co in years, but I can remem­ber when Cis­co was the gold­en child of the tech indus­try. I had friends who were work­ing there, peo­ple who would leave Microsoft and go to Cis­co, and they were pay­ing every­one through the nose, salaries and stock options, and it was insane.

TK: I remem­ber. Do you, you just remind­ed me. I remem­ber being at a din­ner par­ty once around that time

Cameron: I.

TK: peo­ple at a friend’s house, but they had their, some of their oth­er friends there. I did­n’t know the peo­ple, but one of them worked at, a cou­ple of them worked at Cis­co and uh, I, I remem­ber leav­ing a din­ner par­ty think­ing, how do they even get a job?

We’re just that bad.

Cameron: [00:32:00] Yeah,

TK: Yeah. Any­way, so,

Cameron: I’m just,

TK: agreed

Cameron: look­ing, sor­ry. At look­ing at Cis­co’s share price. August, 2000, it was trad­ing at $68. Then by Feb­ru­ary, 2001, it had dropped to $23 and it stayed there until, 2017. We got up to 37 and it’s now back up to 63 60 $4. But, uh, it’s tak­en 25 years to get back to where it was in August, 2000.

TK: And

Cameron: So con­grat­u­la­tions to those peo­ple who are nev­er sell investors.

TK: hope­ful­ly they got paid div­i­dends along the way, but prob­a­bly not. Hey, we should, I don’t know if we have it on our cof­fee cup. I don’t have it handy, but we should add, you don’t get it to our list of, uh, this time it’s dif­fer­ent [00:33:00] quotes.

Cameron: You don’t get it. That’s right. He actu­al­ly, I’m not sure if I’ve got it in my list of clips to play, but he does talk about volatil­i­ty at one point in this inter­view where he says, yeah, volatil­i­ty as val­ue, investors volatil­i­ty is our friend,

TK: Ooh.

Cameron: is some­thing I’ve heard you say. He goes, I like volatil­i­ty.

You know, does­n’t both­er me. It’s what it, what cre­ates oppor­tu­ni­ties for us as volatil­i­ty, right.

TK: Yeah.

Cameron: peo­ple they talked to at one point, and maybe in my clip, so I’ll just shut up and I’ll skip to the next clip,

. We’re, we’re look­ing at are the met­ric we use one met­ric price com­pared to nor­mal­ized earn­ings and nor­mal­ized earn­ings. It, it’s a con­cept, but it’s not a com­plex con­cept. it’s what should the busi­ness earn over a long, over a full eco­nom­ic cycle.

Not the peak, not the trough, on aver­age, what’s the earn­ings pow­er of this busi­ness? Um, and you know, it’s informed by the his­to­ry of the busi­ness. It’s informed by the com­pet­i­tive posi­tion­ing. You know, if you look at, if you talk [00:34:00] about sto­ries of things that you’ve invest­ed in that the, we were talk­ing about the inter­net bub­ble. Well, COVID was anoth­er oppor­tu­ni­ty to buy things at, at crazy prices. And I will, and, and I’ll, we can save this for a lit­tle bit lat­er, but I don’t think we have the same oppor­tu­ni­ties today. um, but Covid we did, and our, we, our biggest hold­ing became in by the end of the sec­ond quar­ter of 2020. Um, you can’t imag­ine a worse busi­ness than ma build­ing jet engines, um, dur­ing covid. and it’s not only that trav­el was down, the num­ber of take­offs and la and land­ings were down 60%. The vol­ume of GEs busi­ness was down more than that because first of all, nobody was built buy­ing new air­planes, most of their rev­enues came from the [00:35:00] repair and remod­el, the repair side of the busi­ness, the spare parts busi­ness, um, ’cause that’s the high mar­gin busi­ness.

And, and so if you were park­ing air­planes, you would oper­ate your, what, the ones you weren’t parked until they had an over­haul date. And then you would park it and pull anoth­er one out and you would spend no mon­ey on main­te­nance. So their rev­enues were down 70%, sev­en, some­thing like that. And imag­ine a giant man­u­fac­tur­ing oper­a­tion with an r and d oper­a­tion with a 70% rev­enue decline, had had 20% mar­gins before that, or 22% mar­gins. That’s real oper­at­ing lever­age you start to see there, right? Yes. So they were, they’re, they’re their free cash flow rate. If I get my, if I’m remem­ber­ing my num­bers cor­rect­ly, and I think I’m pret­ty accu­rate. Was at neg­a­tive $7 bil­lion a year. Um, and the stock went down to $5 a share. And this was a stock that used to be the biggest com­pa­ny in the s and p [00:36:00] 520 years ear­li­er, what at $70 a share. So you’re buy­ing it down 90% from its high. Now grant­ed, a lot of stuff hap­pened in the inter­im, but when you vis­it­ed the com­pa­ny, don’t, they did­n’t know what was gonna hap­pen. All they knew was that, that they had to be focused on costs and sur­vival and liq­uid­i­ty. if you have $7 bil­lion neg­a­tive run rate, bet­ter do some­thing about it. Um, they also, I mean, what made us com­fort­able is they had 50 bil­lion of liq­uid­i­ty of cash and cred­it avail­abil­i­ty. meant they had sev­en years to fix the prob­lem. Hmm. And, and their. CEO was telling us that were gonna go 14,000 peo­ple and they were gonna get the costs down so that they could at least be break even with­out a rev­enue increase. And, and [00:37:00] as we cal­cu­lat­ed it doing, I mean, I, with­out inside data, just try­ing to get a sense of what this com­pa­ny would earn per­ma­nent­ly, trav­el nev­er recov­ered. And that was our down­side case. Um, and we are arith­metic and you can find flaw with it. It, but, but, but it was around cents a share of earn­ings, from a neg­a­tive $7 bil­lion run rate to a pos­i­tive, what­ev­er that was, that cre­at­ed 75 cents a share and the stock was five. So I said, so I could, I could, if the world does­n’t recov­er. I can lock in a 15% annu­al return. And if you lis­ten to, um, the new guy who had this his­to­ry of run­ning indus­tri­al com­pa­nies 30 plus per­cent mar­gins, he said, this should be one of those. That’s what he was telling us. This should be [00:38:00] one of those.

It should­n’t have been a 20% mar­gin busi­ness. We’re gonna run it at 30%. When we get back to nor­mal and 30% mar­gin, would’ve had, some­thing like $2 of earn­ings on a $5 stock. So you sort of say, wow, the down­side cas­es, I make 15% a year, and the upside cas­es I make 40% a year. What am I miss­ing? Um, and that was the kind of oppor­tu­ni­ty.

Now that was one of the extreme ones admit­ted­ly, but that was the kind of oppor­tu­ni­ty that was avail­able.

. Yeah. And I assume he’s talk­ing about GE Aero­space there, this doc with the tick­et, GE, I can’t find it back in 2020 at $5, but I see it around about $30 a share. It’s now trad­ing at, uh, a share. Um, but it might be anoth­er com­pa­ny. I gonna, but just, I, I just like the, the basic idea of that in [00:39:00] terms of, you know, oppor­tu­ni­ties, right?

That which is, as you say, title cycli­cal, great busi­ness went through a real­ly tough time for rea­sons of its con­trol the share price col­lapsed. ’cause no one knew what was gonna hap­pen, but they came in and thought, no, no, this is a good busi­ness and the num­bers made sense to them. So it’s that kind of cycli­cal being, it’s like it gets back to what Buf­fet was say­ing, um, and who, who­ev­er was it. Greg, I think, um, in the last a GM about they do a lot of work, to be ready to move quick­ly when the right oppor­tu­ni­ty comes across their table.

TK: Well that is clas­sic buf­fet, isn’t it? He’s, he’s a, greedy when oth­ers are fear­ful. He’s buy­ing blood on the streets. I mean, it, he’s that same sort of par­a­digm that was just described in that clip is what Buf­fet’s been doing. His whole invest­ing career. There was the oil scan­dal at DERs Club and cetera, et cetera, et cetera.

And just, he, he, you know, uh, [00:40:00] he thought Coke was over depre­ci­at­ing its assets and would write it back. He just. know, with that same kind of insight­ful analy­sis, the, this is a, he calls it the moat. This is a com­pa­ny ge, which is prob­a­bly gonna with­stand some big shocks ’cause they’ve got a lot of cash.

It’s a well-known brand. It’s a big com­pa­ny. It’s when things are nor­mal. It oper­ates at 20% plus mar­gins he buys it when it’s ridicu­lous­ly cheap­er and wast­ed for it to get back to nor­mal.

Cameron: Mm. There’s some oth­er good quotes, but I, I, we, 45 min­utes in, I want you to do your pulled pork and then we’ve got­ta go do an Amer­i­can show. So I’ll leave the oth­er quotes maybe for next time, but um, I high­ly rec­om­mend it if peo­ple haven’t already lis­tened to it. Go check out the Acquir­ers pod­cast and have a lis­ten to all of them ’cause they have a lot of great guests.

Um, I dun­no how Tobias pulls it, but he man­ages to get a lot of big name investors and val­ue investors on the show. But that one with Rich, I found real­ly, real­ly inter­est­ing, real­ly nice guy. Like [00:41:00] real­ly laid back, sort of hum­ble guy too. But, um, just real­ly reflect­ed the basic prin­ci­ples. There’s anoth­er clip I’ve got where he is talk­ing about. and he says, I don’t under­stand. He went to Whar­ton Busi­ness School. He goes, I don’t under­stand macro­eco­nom­ics. He goes, peo­ple, peo­ple try and talk to me about Bit­coin or this. He goes, I don’t under­stand it. He goes, I don’t under­stand gold either. Gold’s boom­ing. I don’t under­stand why I, I just don’t, I don’t get it.

You know, peo­ple say You don’t get it. And I go, yeah, you’re right. I don’t get it. He just sticks with what he knows, which is, uh, you know, buy­ing shares in good busi­ness­es

TK: Cir­cle

Cameron: can get ’em cheap­ly. Yeah.

TK: again, a buf­fet con­cept. Yeah.

Cameron: Hmm. All right, Tony, who are you gonna pull the pork on today?

TK: I am gonna pull the pork on Cettire group. I’m not sure

Cameron: you work out? That was gonna be my first ques­tion. Did you work out in your Paul pork, how it’s pro­nounced?

TK: No, but appar­ent­ly the CEO makes it rhyme with satire [00:42:00] accord­ing to, uh, rear win­dow and

Cameron: I.

TK: So,

Cameron: Right. Well, that’s what, when I was talk­ing about it, I think it was last week. That’s what I kept think­ing. Is this sup­posed to sound like satire or is it a satire? Because it seemed like a bit of a satire when I was the drop ship­ping com­pa­ny. All right. Any­way, I’ll shut up. Let you get into it.

TK: Okay, well I’m gonna call it satire. Um, I’m doing the pulled pork, ’cause we did speak about it last week and it was on the buy list. When I did my analy­sis, the share price had a bump to 55 cents, which is what I’m going to do my analy­sis on, which takes it off the buy list ’cause it’s at the bot­tom. But I did notice today it was back below 50 cents, which I think would put it back on the buy list because it’s at the kind of, it’s push­ing up against the price to oper­ate in cash flow sets of greater than sev­en times thresh­old.

So, um, below 50 cents, I think it’s a buy above it. You might want. Wait. So, um, and that’s, uh, that’s why it may not be on the by list if you have a look at it when you hear this, but it was last week it’s [00:43:00] an inter­est­ing com­pa­ny. I, I, you know, it’s, it’s rare that we get, uh, a bit like, a bit like, um, Cis­co.

It’s rare that we get, uh, I, uh. It’s not a tech com­pa­ny, but it’s a, a cap­i­tal like busi­ness, which is the whole basis of the, of inter­net retail, that, that put, uh, put Ama­zon, et cetera on the map. And this is one of those kinds of com­pa­ny which does­n’t hold stock, as you say, it’s a drop ship So, um, I thought it was real­ly inter­est­ing to do a pulled pork on it and inter­est­ing to see it on the buy list.

Um, I’ve titled my pulled Pork, how the Mighty Have Fall­en because the share price was $4 79 in Feb­ru­ary last year, and it’s now around 50 cents. The analy­sis, uh, as of yes­ter­day, it was 55. It’s dropped again below that. Uh, if you look at the graph, it’s a falling knife. So that’s some­thing to be aware of.

It’s the price has been going down, obvi­ous­ly from that high, uh, to today’s price, which is, you know, [00:44:00] or there­abouts of what it was a year ago a lit­tle over a year ago. So that’s a big, a big drop. but the price did kick up above its buy line, uh, last week. So it, so it is a buy on. Um, on, on our buy list, uh, I, I did talk about the arti­cle last week, uh, where there was some ques­tions raised about an, uh, by an inves­tiga­tive jour­nal­ist about, uh, whether sales tax had been incor­rect­ly charged, um, for us ship­ments and, um, weath­er.

That was help­ing the bot­tom line of this com­pa­ny. That’s all I’ll say on that. You can, if any­one’s inter­est­ed, they can Google the rel­e­vant arti­cles and the com­pa­ny’s response to it. It’s, it’s all pret­ty high pro­file stuff on the inter­net last year, um, the back­ground to this com­pa­ny was, it was launched in 2017 and it list­ed in 2020 at 50 cents a share, rais­ing 65 mil­lion.

So the share price is back to where [00:45:00] it, uh, start­ed. mar­ket cap is up over 208 mil­lion, but the share price is back to where it start­ed. oth­er thing to notice about this com­pa­ny, and its its share graph, is that, uh, accord­ing to Stock Dock, the com­pa­ny is held, or shares in the com­pa­ny is held heav­i­ly by short sell­ers.

So it’s some­thing like 10% of out­stand­ing stock has been bor­rowed and sold by short com­pa­nies. Now, the inter­est­ing thing about this is that, um, uh, they would’ve start­ed short­ing it a lit­tle while ago dur­ing the drop from 4 79 down and dur­ing the. alle­ga­tions of sales tax, tax, um, uh, manip­u­la­tions right­ly or wrong­ly.

And, um, it, it’s pos­si­ble, and I’ve seen this hap­pen before, that the Kick­Up in the price now is caused by what’s called a short squeeze. So if some­one’s made a lot of mon­ey short­ing the stock, they will even­tu­al­ly sell it and hand it back to the orig­i­nal own­er and pock­et the, the [00:46:00] loss as a cap­i­tal gain, if that makes sense.

So the way short sell­ing works is I buy it at 4 79, I wait until it gets to 47 cents I buy the stock back in. So I buy it at 4 79. I sell it. I take, keep those pro­ceeds in my pock­et, and when the price has dropped enough, I buy the stock back and hand it back to the per­son I bor­rowed it from. I’ve made a, a tidy prof­it.

Cameron: So, um, that’s why I was con­fused. You said most 10% of the stock is held by short sell­ers. How can it be held by short sell­ers if they’ve sold it?

TK: Uh, well, they have to, it’s not, you’re right, it’s not held by short sell­ers. The oblig­a­tion is for them to, to return 10% of the stock, to do that, they’ve got­ta buy the stock and then return the shares back to the per­son they bor­rowed it from.

Cameron: How does, how does any, like, how is that tracked? How does any­one know that? Is that report­ed some­where when you have a short trans­ac­tion,

TK: Yeah,

Cameron: when you

TK: the,

Cameron: Right.

TK: about this last week as well. Again, um, Mac­quar­ie Group were pulled up by, uh, ASIC for not report­ing prop­er­ly [00:47:00] their, their short trans­ac­tions. So basi­cal­ly, if you are, if you are lend­ing your stock to a short sell­er, I’m not sure who has to report it, but one, the side of that trans­ac­tion, or if not both have to report it to And so ASIC can then make the mar­ket aware that there’s a large amount or a lit­tle amount of short sell­ing going on in this stock.

Cameron: ASIC or the ass x.

TK: I think it’s ASIC and I, I think I may have said April last week when we were talk­ing about Mac­quar­ie and, um,

Cameron: You did say Ara. Yeah.

TK: I did, it’s, it was wrong. It’s ASIC who does the track­ing on this stuff, I’m pret­ty sure. So apolo­gies for that. But, um, yeah, I

Cameron: Right.

TK: tracks this. Um, and, uh, Mac­quar­ie group peo­ple can read about that have been picked up for not report­ing this stuff prop­er­ly.

Cameron: So, sor­ry, I cut you off. You were gonna explain what a short squeeze is. Again,

TK: Yeah,

Cameron: dat­ing a lit­tle per­son, but you’re not refer­ring to that.

TK: uh, no. So what hap­pens is, uh, if, if the share price is [00:48:00] bombed out as this com­pa­ny share prices and it starts to ro to Rise again, it means that the, it’s start­ing to erode the prof­its of the short sell­ers and they basi­cal­ly jump into the mar­ket and buy shares to give back to the per­son they’ve. Bor­rowed them from.

And that buy­ing also forces the stock up. So it squeezes peo­ple who haven’t bought and returned the shares to buy. And that, that buy­ing alone can be enough to lift the price of a, a short­ed stock. And you often see that when the short sell­ing the clients, it’s because the, the share price is going up and it becomes a cycli­cal thing.

The short sell­ers then make the share price go up ’cause they’re buy­ing it to return the stock. So that’s called a short squeeze that, that kind of, um, ampli­fi­ca­tion of the upturn. So that’s pos­si­bly where we are with this stock. Um, even so I think it’s prob­a­bly, know, below 50 cents, it’s, it’s good val­ue.

So I think even if you, um, not wor­ry­ing about the short side of things, it’s, it’s, it’s cer­tain­ly approach­ing fair val­ue. [00:49:00] Um. over, its over. Its rel­a­tive­ly short. Life has shown strong rev­enue growth and in some years there was a dou­bling in sales. And even as recent­ly as 2023, it cer­tain­ly got a kick along dur­ing covid as peo­ple were not going out to shop.

They were shop­ping more online. but in the 2024 cal­en­dar year that that slowed, and in fact in the finan­cial year, end­ing, uh, on the first half of the finan­cial year for 2025, so end­ing in Decem­ber, the sales growth was just 12%. still good num­bers for a retail­er, but it’s not dou­bling every year like it did at the start.

So, and, and we’ve seen this before, even with Cis­co, the. Peo­ple jump in on this growth stock. It’s, it’s, it’s mar­ket cap’s gone from 50 odd mil­lion dol­lars, $60 mil­lion at list­ing to 208 rev­enue’s dou­bled every, pret­ty much every year for the first four or five years. And peo­ple want to get in on this [00:50:00] excit­ing growth stock.

And of course, now that the is com­ing out of it, the, the prices is dropped dra­mat­i­cal­ly and the P’S com­ing back to back to Worth. Um, so that’s what we’re see­ing now. Uh, still good num­bers for a retail­er though. I mean, you know, Kmar or Tar­get, or Mey­er or David Jones would love to have 12% rev­enue growth on year.

com­pa­ny’s based in Mel­bourne and Williams Street, uh, where I first began my cor­po­rate life work­ing for Shell and Williams Street in Mel­bourne. uh, that’s where this com­pa­ny’s based. Um. I haven’t shopped with Sai, so I, I, I can’t com­ment on their ser­vice or their oper­a­tional abil­i­ty. When I went to their web­site, was an awful lot of, uh, $500 t‑shirts for sale, and I did­n’t real­ly feel like fork­ing out it 500 bucks for a white t‑shirt, no mat­ter uh, who makes it and what brand they have on it.

Um, so I haven’t shopped with them. It’s not my, not my cup of tea, but they do claim that there are near­ly 700,000 active cus­tomers. And I [00:51:00] think the key thing is a large por­tion of those live in the us and that’s. of what’s going on to bring them where they are at the moment. Stock Dock pub­lished a good analy­sis I’m gonna bor­row from that.

Um, CTT is a glob­al drop ship­ping online lux­u­ry retail­er. Under the drop ship mod­el, the busi­ness accepts cus­tomer orders with­out keep­ing stock on hand, the busi­ness to gen­er­ate strong cash flows with­out hav­ing high work­ing cap­i­tal require­ments. The invest­ment appeal lies with its low cost oper­at­ing mod­el and back­end tech­nol­o­gy, which enables the com­pa­ny to facil­i­tate an effec­tive ful­fill­ment or the chain through the coor­di­na­tion of glob­al logis­tics, cus­toms com­pli­ance, man­ag­ing prod­uct returns, han­dling pay­ments, and fraud detec­tion.

addi­tion, lux­u­ry goods tend to be less sen­si­tive to con­sumer behav­iors from ris­ing inter­est rates because high-end retail con­sumers from the wealth effect led by a founder. And CEO. Dean Mince, [00:52:00] who remains a large investor despite sell­ing him some of his shares in 2223. its high fore­cast, return on equi­ty and strong earn­ings growth prospects, team being stock doc­tor has refrained from cov­er­ing the stock due to the fol­low­ing risks, high lev­els of short inter­est, spec­u­la­tion that the com­pa­ny has not paid its share of import duties, low prof­it mar­gins dri­ven by high mar­ket­ing costs, and that do not pro­vide a mar­gin of safe­ty in the inven­tive increase in com­pe­ti­tion.

Con­sumer con­cerns around the authen­tic­i­ty of its prod­ucts. So that’s stock doc­tors analy­sis, which I thought was a good sum­ma­ry. Um, back to the drop ship­ping mod­el, the com­pa­ny claims to car­ry a vir­tu­al inter­est inven­to­ry of $2 bil­lion. So that’s the inter­est­ing thing. I think they’ve got. Access to $2 bil­lion of in inven­to­ry, but they haven’t had to pay for it until a cus­tomer places an order.

Then they go out and buy that par­tic­u­lar item and sell it. So when I think back to my days of retail, that would’ve been a [00:53:00] huge ben­e­fit, um, for a com­pa­ny like my direct that I worked, uh, that I worked in and ran. because it’s real­ly hard to bal­ance your inven­to­ry lev­els if you’re a retail­er. of the rea­sons, because like you think about it, you know, I don’t know what’s gonna be on trend in three months time.

If Kim Kar­dashi­an wears a black dress down the run­way and I’ve got a ware­house full of white dress­es, they’re not gonna sell

Cameron: You know what the prob­lem is though, don’t you? Elbow’s gonna come and tax them on all the stuff they haven’t sold yet.

TK: pos­si­bly an unre­al­ized gain, pos­si­bly. Um, well that would be a loss, I think in that case, but yeah. Uh, so any­way, so they’ve got a vir­tu­al inven­to­ry of $2 bil­lion, and that’s the mag­ic in this. Style of com­pa­ny that they, um, don’t have to fund that they car­ry no debt, which is some­thing which we like. It’s on our buy.

It’s one of the rea­sons why it’s on our buy list. Uh, the founder holds 33% of stock despite sell­ing down, um, over the, over the last cou­ple of years. Still retains a lot. Uh, look­ing at the lat­est results. Uh, [00:54:00] now inter­est­ing­ly enough, they pro­vid­ed a Q3 sales update to the mar­ket on the 23rd of April, and that was for the, uh, quar­ter end­ing the end of March.

Um, don’t nor­mal­ly pro­vide quar­ter­ly updates. It’s some­thing you have to do in the us not here. So I was inter­est­ed why they were doing that, and I checked to see if it was a dual list­ed com­pa­ny. Um, but it isn’t, so it’s only, its sole list­ing is on the A SX. So I did. Won­der why they were mak­ing quar­ter­ly earn­ings reports and all.

I could think of spec­u­la­tion, but I’m guess­ing that they liked the sales ris­es in the past being so, so high and that they want­ed to keep the mar­ket appraised of them. And if that was the strat­e­gy, it’s come, come back to bite them because in the last quar­ter their sales rise was only 1% and they also declared a loss for the quar­ter of approx­i­mate­ly $4 mil­lion, which was blamed 50% on for­eign exchange loss­es for the half.

And um, and they also went into some detail about us tar­iffs soft­en­ing their [00:55:00] demand. they did point out that 1% sales growth is bet­ter than the rest of the lux­u­ry brand mar­ket as a whole, which was going back­wards. So, um, they have to, uh, hold on to at least some sales growth. Uh, one inter­est­ing note when I was going through their pre­sen­ta­tion was they, they.

Report to sales lines. They, they talk about gross sales, which is rev­enue of 260 mil­lion. but then they talk about sales after returns, which is 192 mil­lions. and that, that’s, this was a sim­i­lar pat­tern in terms of the ratio to pri­or peri­ods. 26 of 26% of their sales by dol­lar val­ue have been returned.

And um, a lot of work to do to process those returns. Plus it’s not a great cus­tomer expe­ri­ence nec­es­sar­i­ly ’cause some­one’s got­ta pack­age up what they don’t like and send it back to the com­pa­ny and it’s got­ta be put back through the sys­tem in reverse and cred­it­ed and sent back to who­ev­er they, uh, they bought it off if they [00:56:00] can.

Some­times that you can’t do that. So I know again, from oper­at­ing and retail returns are a net ne net neg­a­tive to the busi­ness. And hav­ing, we nev­er had any­thing like 26% of sales as returns at my direct. I can’t remem­ber what the num­ber was, but it would’ve been prob­a­bly sin­gle dig­its. So, um, yeah, if, if they can get that down, good.

Look, it might be a pos­i­tive that I know with the online retail busi­ness, if you don’t know what your size is from with this brand, it’s the first time you bought a pair of shoes from that brand or a dress from that brand or what­ev­er. You might buy three dif­fer­ent sizes and try them on and then return the ones that don’t fit.

So could be a bit of that going on, in which case it might be a good thing for the busi­ness, but it’s cer­tain­ly a big cost for that busi­ness. The oth­er thing I wan­na focus on in ana­lyz­ing this busi­ness is tar­iffs. And, uh, tar­iffs have now come in, of course, um. All sales to the us. 43% of SAI sales are drop shipped from Europe to the us [00:57:00] and so they face tar­iff hikes.

report that only 4% of their sales are from Chi­na to the us. So that’s where the worst tar­iff or the high­est tar­iff hikes have hap­pened. Even though they’re on a 90 day pause, they’re still high. Um, but they are fac­ing tar­iffs high, high tar­iff, high­er tar­iffs from the EU to the us. oth­er thing they’re fac­ing is what’s called the, de min­imus, um, law changes in the us.

So, the aver­age satire sale to the US is 514 US dol­lars. And up until now that that kept them below the de min­imis thresh­old of, um, $800 us. And for those lis­ten­ers who don’t. Know what that means. De min­imus in Latin means too small to mat­ter. And de min­imus was an exemp­tion applied to parcels, gen­er­al­ly shipped from over­seas direct to a cus­tomer.

And these pack­ages were, um, did­n’t go through the ware­hous­es and there­fore are hard­er to reg­u­late for cus­toms duties and tar­iff charges. [00:58:00] back when de min­imus was enact­ed a hun­dred years ago or so, the log­ic was that the US gov­ern­ment should not spend a dol­lar to col­lect 50 cents. that, uh, has been, I guess, the prin­ci­ple all the way along.

Um, and even­tu­al­ly the, the min­imus thresh­old went up to $200. And then, uh, when Oba­ma was pres­i­dent, he. Boost­ed it to $800, uh, which kind of suit­ed Ama­zon and oth­er US com­pa­nies start­ing to ship from the, uh, uh, ship, direct to retail­ers, uh, often from over­seas. And so it sits at $800 now, but on May 14th, pres­i­dent Trump includ­ed the min­imus pack­ages from Chi­na and Hong Kong in 135% tar­iff law, is now on a 90 day hold and reduced to 54% dur­ing the hold peri­od.

So only even com­ing out­ta Chi­na and Hong Kong, um, now faces 54% tar­iffs on, um, even small parcels. So [00:59:00] it’s not a big chunk of change for satire at the moment ’cause only 4% of their sales to the US come from Chi­na. But, um. Trump admin­is­tra­tion has flagged that they’re going to work through pack­ages from oth­er juris­dic­tions rais­ing the tar­iffs on those as well.

And the only thing that’s stop­ping them from doing it now is that they can’t process the trade from Chi­na and Hong Kong through the ware­hous­es that the cus­toms peo­ple have to put them through to be able to charge the right duties and tar­iffs on them. But once they get that sort­ed out, they’ll, um, they’ll start doing that.

to be fair to the, um, to the cur­rent admin­is­tra­tion, Biden was also look­ing at the issue of de min­imus parcels, large­ly from the point of view of that, um, the US gov­ern­ment sus­pects that, uh, the fen­tanyl trade from Chi­na was mak­ing, um, use of the de min­imis parcels that weren’t going through cus­toms inspec­tions and, and send­ing drugs over­seas.

So, um, [01:00:00] and that’s, and that’s cer­tain­ly the argu­ment, one of the argu­ments from Trump as to why the exemp­tions been removed from, from Chi­na. So if this de min­imus change gets rolled out to the u EU ship­ments, then satire will have a big prob­lem. Because you glance at their web­site, they’re ob, they’re usu­al­ly offer­ing about a 30% dis­count on what they claim is the retail brand price for a lux­u­ry item.

If, if that, if they then get hit with a tar­iff on the min­imus, uh, parcels, which they’re not being hit on now, then that that dis­count goes away, which would affect them dra­mat­i­cal­ly. So it, it is, as we said before, a volatile place at the moment. And, um, uh, satires cer­tain­ly face some risks if you’re think­ing about invest­ing in it from, uh, from tar­iffs and the min­imus changes.

What’s, what do I think? I think that they might be short term. I would­n’t be sur­prised if some­one [01:01:00] works out how to get round that prob­lem and. You know, they might work out, for exam­ple, that ship­ping via Aus­tralia, which isn’t cur­rent­ly sub­ject to the min­imus, um, leg­is­la­tion, is cheap­er than send­ing it direct from Chi­na to the US and pay­ing the 54% tar­iff.

I might. May be able to work out a, a mid­dle­man or some oth­er way of get­ting stock to cus­tomers with­out fac­ing huge tar­iffs. But that has­n’t hap­pened yet. Um, but it’s cer­tain­ly some­thing for peo­ple to con­sid­er going for­ward as, as I’m, as I’m sure that the CEO of, um, Sati is think­ing about now.

Okay, so going onto the QAV num­bers, the stock price I used was 55 cents. It is below that now, which puts it back on the B list, but at 55 cents, it fell off the bot­tom of the B list. 55 cents though is still 80% of con­sen­sus. Tar­get IV one. For this com­pa­ny using my method­ol­o­gy is only a cent and there’s no IV two because there’s no fore­cast EPS avail­able, so we can’t buy it less.

And it’s [01:02:00] Arin intrin­sic val­ue and that’s due to the fact that, um, uh. This is one of the com­pa­nies which ha has been prof­itable, but um, not, uh, it’s been using the prof­it to rein­vest in the busi­ness and, and use mar­ket­ing to expand its cus­tomer base. Now they are talk­ing about chang­ing that to try and max­i­mize prof­it now, and it did make a loss in the first, in the last quar­ter.

But, um, at the moment it’s, it’s iv using its earn­ings per share is only 1 cent. There’s no div­i­dend, so we can’t score it for that stock dock. Finan­cial health and trend is sat­is­fac­to­ry and steady. Like­wise, stock Edia qual­i­ty rank­ing is 92. So on the qual­i­ty side of things, every­one likes it. How­ev­er, stock Edia ranked the com­pa­ny as 54.

Um, out of a hun­dred for val­ue and five for momen­tum It only a total of 51 in the Stock­o­pe­dia rank­ing uni­verse. And that reflects the falling nice share price graph. I think, like­wise the PE ratio is 194 times giv­en its low [01:03:00] earn­ings at the moment, that’s the high­est and six halves. So we give it a neg­a­tive score for that.

calf at 55 cents is 7.5 times, um, which, uh, takes it off the buy list. But at, when I looked this morn­ing, I think the share price was back to 48 cents. So. That would prob­a­bly it back onto the buy­er list. there’s an own­er, founder who cur­rent­ly owns 33% of stock, he did buy some more last year.

Um, he only bought 15 mil­lion, how­ev­er, but that fol­lowed about, uh, $287 mil­lion in share sales in the two years pri­or to that. So he’s cer­tain­ly been rais­ing red flags in the mar­ket, sell­ing all the shares as the price has been drop­ping and the com­pa­ny was fac­ing, uh, the spot­light of inves­tiga­tive report­ing and, um, issues with tar­iffs.

Uh, com­pa­ny does­n’t have con­sis­tent­ly increas­ing equi­ty. It did up until last year, but we can’t score it for that now. Um, so over­all the score is sev­en out of 13 [01:04:00] or 54% for qual­i­ty at 55 cents. The QAV score is now 0.07, but it will be high­er at 47 cents. Um. I think what can, what can I say about this? I think stock doc­tor cov­ered off the risks about it, um, quite well.

I think we cov­ered the risks of tar­iffs quite well. but, you know, peo­ple are always inter­est­ed in cap­i­tal, like tech busi­ness­es and so any­one who’s inter­est­ed in that might have a look at this. Um, oth­er­wise it’s prob­a­bly one to watch and enjoy the roller­coast­er ride giv­en all the uncer­tain­ty in that par­tic­u­lar mar­ket going for­ward.

Cameron: Wow. I was just look­ing at what price it was at on the buy list last week when I was going to add it to the light port­fo­lios, and then I got the hee­bie-jee­bies with it talked to you and you said, eh, it’s fine, was at 45 cents. Then. then it went up to 60 and then now it’s down back down to 48 [01:05:00] a week.

TK: Yeah. which is,

Cameron: is

TK: it’s volatile but it’s also lead­ing, lead­ing me to think it’s the short squeeze that’s dri­ving the Yeah.

Cameron: Yeah. Speak­ing of things going down, the RBA has cut rates, 25 basis points to 3.85%

TK: So we need to update our spread­sheets for our, our, um, what we

Cameron: cash rate,

TK: vari­able. Yeah.

Cameron: the cash rate. Yeah. So, um, your sheets, update your clocks, ladies and gen­tle­men. Um, I was going through the US check­list over the week­end try­ing to get equiv­a­lent US num­bers for those sorts of things too.

TK: Yeah, of course.

Cameron: Because I need to, a lit­tle bit dif­fer­ent over there, so there you go. What do you think of Michelle Bul­lock­’s deci­sion to cut inter­est rates?

Tony, what she said was the risk to infla­tion has become more bal­anced. The RBA remains [01:06:00] cau­tious about the out­look. It nev­er­the­less remains cau­tious about the out­look. Okay. They repeat­ed them­selves there, par­tic­u­lar­ly giv­en the height­ened lev­el of uncer­tain­ty about both aggre­gate demand and sup­ply. The board con­sid­ered a severe down­side sce­nario and not­ed that mon­e­tary pol­i­cy is well placed to respond deci­sive­ly to inter­na­tion­al devel­op­ments if they were to have mate­r­i­al impli­ca­tions for activ­i­ty and infla­tion in Aus­tralia, cetera, et cetera. Sor­ry. Go on.

TK: No, that’s okay. I think, I think that’s well said. I think, uh, infla­tion was back into what the RBA calls. Its, um, its band it wants it to be. Um, that hap­pened. I dun­no if it was dur­ing the elec­tion or maybe just before it. And so I thought that they would, as the mar­ket did, they would hold onto, they would­n’t low­er inter­est rates until after the elec­tion.

So they, they weren’t seen as the gov­ern­ment or the oppo­si­tion. And, um, uh, this was [01:07:00] prob­a­bly a lit­tle bit over­due. I thought there’d be 25 basis points as well, because as they out­lined, um, if they, if they need to, if some­thing real­ly bad hap­pens in the world with tar­iffs, with what­ev­er, as you know, we can’t fore­cast it, but it’s cer­tain­ly a volatile place, uh, then they need to have kept pow­der up their sleeves or their pow­der dry so that they can drop inter­est rates by a large amount if they need to.

if the shit real­ly does hit the fan, um, in the econ­o­my and it, and if they had have gone with a big­ger cut this time and some peo­ple made the argu­ment they should, then they’d have less up their sleeve if some­thing real­ly bad hap­pened. So I think with infla­tion back under con­trol and the elec­tion sort of forced ’em to wait a bit.

25 basis plus. Makes sense.

Cameron: Just look­ing at how the mar­ket has respond­ed. Uh, not much at all, real­ly. Um, the, it’s gone up a lit­tle bit since the announce­ment came out, but it’s still low­er than it was at 10:00 AM this morn­ing or 10 40 this morn­ing. So [01:08:00] has­n’t real­ly, uh, peo­ple aren’t danc­ing in the streets. I think every­one expect­ed it. Hmm,

TK: then for sure. Bond, bond future or bond Did

Cameron: Bond, bond yield.

TK: guess

Cameron: my name.

TK: Yeah.

Cameron: Yeah. Well, that’s all for, unless you’ve got some­thing else. We’re into after hours. Tony, we skipped it last week. Got any­thing good for me this week? Got any tips? Got any rec­om­men­da­tions?

TK: Well, haven’t watched much ’cause I’ve been trav­el­ing and play­ing golf and some fan­tas­tic golf cours­es in South­ern Coast of New South Wales. peo­ple go and play Mol­ly­mook and Naru golf cours­es if you haven’t. Uh, they’re very good na rumor in par­tic­u­lar, right on the, um, right on the coast on cliffs.

You shoot over cliffs on at least one of the holes, which is, which is fun. but when I got back on the week­end, I watched a cou­ple of episodes of Mob Bland, caught up with that, [01:09:00] it’s, it real­ly is stand­out. I high­ly rec­om­mend Mob Bland to

Cameron: I got­ta check that out. Mob Land?

TK: uh, Pierce Bros­nan and Helen Miran. All fan­tas­tic.

Cameron: Hmm. Okay. I do love a bit of Helen Maren.

TK: Ooh. She seems to be in every­thing at the moment, does­n’t she? She’s in, um, she’s in, com­ing out in the, what’s it called, the Thurs­day Detec­tives Mur­der Club, or what­ev­er it is. The books that Richard Osmond write, um, in, is 1823, the pre­quel to the pre­quel to, uh, Yel­low­stone. she’s in this, she must be in her sev­en­ties.

I mean, she’s, she’s

Cameron: Mm.

TK: very active and doing great.

Cameron: But she will nev­er be in any­thing bet­ter than Caligu­la. Caligu­la chef’s kiss.

TK: Oh, Real­ly?

Cameron: Yeah. Oh yeah. The fact that she was most­ly naked run­ning around and it’s got noth­ing to do with it. But yeah. One of my favorite films, ULA love [01:10:00] it. Love it. It’s a mas­ter­piece. It’s bonkers. Com­plete­ly bonkers. But, uh, that was kind of the point, right?

TK: All right.

Cameron: They’re try­ing, try­ing to depict near a, uh, not near a caligu­la’s reign as bonkers, which it’s prob­a­bly unfair to Coag­u­la. I think he’s been, uh, bad­ly treat­ed by his­to­ry. But, um. She was in her absolute prime in the ear­ly sev­en­ties. Dun­no how old she was, but prob­a­bly about the same age as uh, what’s his face?

Who was in it with her? Um,

TK: Mal­colm McDow­ell.

Cameron: yeah,

TK: Mal­colm McDow­ell. Any­way. McDow­ell?

Cameron: Mal­colm McDow­ell would’ve both been in there sort of mid to late twen­ties, I guess.

TK: Mm. And Pierce?

Cameron: Uh,

TK: too. In mob land. Just he’s revert­ed back to his Irish accent. Does­n’t use any­more. Yeah.

Cameron: Right,

TK: Just that. Just the mob boss? The patri­arch of the fam­i­ly. Oh, Cameron, I told you I had to do that. You did­n’t do it when I told you you’ll do it now.

Cameron: [01:11:00] because he still got the beard. He had to grow the beard to get away from bond. I think

TK: Oh, okay. Oh, I can’t recall. I don’t think so. Maybe. Can’t recall.

Cameron: every time I’ve seen him on chat shows he’s had beards.

TK: Okay.

Cameron: Well, I’ve been watch­ing, uh, a, a Black Mir­ror. I watched the first episode of the New Sea­son of Black Mir­ror. Have you seen that yet?

TK: No, still through the old ones.

Cameron: Oh, right this one. First episode of this one. Absolute­ly. Gut wrench­ing, ter­ri­fy­ing. Um, Chris­sy and I watched it the oth­er night. She was like, well, that was not the good thing to watch before I went to bed. That was hor­ri­ble.

TK: I may

Cameron: Um, yeah. No, it’s good. I mean, it’s ter­ri­fy­ing. It’s basi­cal­ly about cor­po­ra­tions, uh, get­ting in. Yeah, I know. That’s, that’s what keeps you awake at night.

TK: Ter­ri­fy­ing.

Cameron: I. Yeah, should just be a Black Mir­ror episode elbow tax­ing, unre­al­ized gains One [01:12:00] day in the future. start­ed watch­ing total when I was clean­ing the kitchen last night.

TK: you can’t do that. You got­ta lis­ten to me

Cameron: I start­ed watch­ing the, uh, the, the schwartzeneg­ger ver­sion of total recall from 1990. could have been a Philip take Philip k Dick. Short sto­ry, like one day in the future, gov­ern­ments will come for unre­al­ized gains the most dys. That’s your ver­sion of a dystopi­an

TK: k Dick­’s short sto­ry.

Cameron: com­ing for unre­al­ized gains.

TK: No, no. I can remem­ber. We can remem­ber it for you whole­sale. That was the

Cameron: Yeah, I’m say­ing that that could have been anoth­er book that Dick wrote was, in a dystopi­an future, they come for your unre­al­ized gains.

TK: the coali­tion is split, the gov­ern­ment will come for your unre­al­ized gains and there’s no,

Cameron: I’m also. I’m also halfway through watch­ing Rashon for the first time. I’ve nev­er seen Rashon [01:13:00] before.

TK: have I.

Cameron: Haven’t seen it. Hmm

TK: No,

Cameron: uh, good, real­ly good.

TK: the same or the same inci­dents repeat­ed by dif­fer­ent rec­ol­lec­tions,

Cameron: How do you know that if you’ve nev­er seen it?

TK: Oh, it’s part of the movie Folk­lore. And it was the basis for, what was the Rid­ley Scott movie I rec­om­mend­ed last year or the year before? I think it was on Net­flix with Matt Damon and Ben Affleck and, uh,

Cameron: Long as it was­n’t Napoleon?

TK: well, no, the lady from Killing Eve.

It was pri­or to Napoleon. based on Rima.

Cameron: Uh

TK: sto­ries of a rape, uh, as to, as

Cameron: oh.

TK: it.

Cameron: So rape ’em on? No.

TK: She got a rash.

Cameron: Yeah, like it’s, it’s true. I mean, I’m halfway through it and I could­n’t watch it while I was clean­ing the kitchen because it’s all sub­ti­tled. So I need­ed to pay, need to pay atten­tion to it. So what I watch when I get home from kung fu, my body hurts and I have to lie there and stretch and mas­sage my mus­cles out. [01:14:00] Um, oh, Fox had his kung fu grad­ing on the week­end. He got a new belt. Um, so he got his fourth belt. It’s his fourth grad­ing, no third grad­ing, fourth belt. ’cause he starts with a belt. Um, he did real­ly well. I was real­ly proud of him. He’s, he.

TK: col­or belt’s that.

Cameron: Uh, this is the mid­dle blue belt. So it’s the, there’s three blues.

It’s the sec­ond the three blues, and it’s, it’s a, there’s not many kids, that get that lev­el belt. You know, out of all the kids that we’ve seen in the four years that we’ve been there, many stick around long enough to get that. He’s been going three years now. So it’s, uh, not, not many kids last three years at kung fu, you know, 10% maybe.

So, um, he’s doing real­ly well and it’s inter­est­ing to watch him slow­ly get­ting more seri­ous about it. You know, as he gets bet­ter and he starts to real­ize that he’s actu­al­ly get­ting pret­ty good spar­ring. He sparred with the adults after­wards. On Sat­ur­day, he gets in and joins our spar­ring match­es, and he holds his own man.

[01:15:00] Like he’s, he’s got the, he’s got the instinct for it a lot of peo­ple, even adults in, in spar­ring, I mean, we got easy with the spar­ring, like no one’s try­ing to hurt each oth­er. It’s got gloves on or what­ev­er, mouth guards. But a lot of peo­ple, you throw a punch at them and they’ll turn their head, you know, an instinc­tive blink or shut their eyes.

Turn their head. Not fox man. He just comes in and starts, gets under­neath it and starts hit­ting me in the ribs and hit­ting me in the kid­neys. And he’s in the groin?

TK: You might, you might live to regret all this camp.

Cameron: Yeah. Prob­a­bly. Or not live to regret it ’cause he kills me in my sleep.

TK: bed­room for a diary. I almost got dad at kung fu this week. I’m get­ting

Cameron: Yeah.

TK: now.

Cameron: Yeah. Count­down.

TK: Yeah.

Cameron: Um, I’ve got.

TK: the last jew­el was the Rid­ley Scott movie based on Rashomon.

Cameron: Oh, I’ve seen [01:16:00] the last Jew­el. No, not the last Jew­el. No. I’m think­ing of his, Earl, his first film. What was his first one? The, the Dual­ist? Yeah, yeah, yeah. No, you remem­ber you telling me about this. Okay. Oh, Rid­ley. I can’t watch Rid­ley any­more. Rid­ley’s broke, broke my Heart with the Napoleon film. Um, I’m read­ing Tin­ker Tay­lor, sol­dier Spy,

TK: Yeah.

Good on you. Good book.

Cameron: it.

Yeah, I’m halfway through it or third of the way through it. Enjoy­ing that.

TK: There’s a great, ver­sion of it that came out 10 years ago or so with all the great British actors in it.

Cameron: Gary Alban in that one as Smi­ley.

TK: Yep.

Cameron: And then all Guin­ness I think did played Smi­ley in the sev­en­ties ver­sion. I. Oh, cvs. Yeah. Right. I haven’t seen any of those. So it’s all, the sto­ry’s all new to me, but I’m enjoy­ing it. And, um, I’ve got a band for you if you’ve nev­er heard of them. Tin­der Sticks.

TK: Did you men­tion that last week? Is that the girl band?[01:17:00]

Cameron: No, that was Teen Jesus in the Gene Teasers Eas­es

TK: Oh, I saw a clip recent­ly too, of, uh, Amal and the Snif­fers on, uh, one of the Tonight shows.

Cameron: bal­lon or some­thing. I haven’t, I haven’t seen that yet, but I’ve seen it pro­mot­ed. I real­ly wan­na dig it up and watch it. I’m so hap­py for them.

TK: Yeah.

Cameron: So hap­py for them to be get­ting this sort of US cov­er­age. Such a great Aus­tralian export.

TK: Fal­lon, right? It’s

Cameron: Yeah.

TK: all these Mid­west­ern farm­ers in New York going to Jim­my Fal­lon, whoop­ing and hol­ler­ing, and then this white girl from Aus­tralia gets up and jumps up around into a punk band. It’s fan­tas­tic.

Cameron: I guess it was­n’t one of the songs where she swears a lot in it unless they just bleep the whole thing.

TK: say­ing, so

Cameron: Oh, right. Oh, I love Amil and the snif­fers just so much fun. Like I just, I’ve seen a cou­ple of their con­certs on YouTube and I just had this huge grin on my face through the whole thing. It’s just so, the joy of Eve in watch­ing them, it is just, it’s so [01:18:00] great. No Tin­der sticks I just dis­cov­ered this morn­ing and it came through a Spo­ti­fy rec­om­men­da­tion based on, you know, you can say, you know, like a radio thing. It was based on Dirty three. I’d been lis­ten­ing to Dirty Three, cre­at­ed Dirty Three Radio and Tint Sticks came on. Tint Sticks is sort of a cross between Dirty Three and Nick Cave and Leonard Cohen, UK Trio start­ed in the mid nineties, drums and vio­lin. But you know, where Nick does his sort of meowy bal­la­dy stuff in the last 20 years, it’s kind of very much like that.

TK: Okay.

Cameron: lush, lot of strings, lot of piano. And the vocal­ist is very Nicky in his mel­low. know, old­er, sort of, kind of Nick era.

TK: Yeah. Right.

Cameron: papa won’t leave you. Hen­ry, Nick and not the birth­day par­ty Nick, but ver­sion four, Nick, what­ev­er it is. [01:19:00] Uh, but I’ve been lis­ten­ing to it while I was work­ing. It’s beau­ti­ful sort of atmos­pher­ic, ambi­ent kind of going on. It has lyrics, but it’s um, yeah. Nice. Chris­sy liked it too. I played it too in the car on the way to Kung Fu. So there you go. Tin­der sticks.

TK: Actu­al­ly, I had

Cameron: my music tip.

TK: wrote down a cou­ple of weeks ago to rec­om­mend to you on in that sim­i­lar vein, the veils, have you heard them?

Cameron: No,

TK: track called Sit Down by the Fire, which just, it could have been Nick Cave singing at it’s a, a Bal­lard like that too in that

Cameron: V‑E-I-L‑S. Oh yeah.

TK: right.

Cameron: Eng­lish New Zealand Indie rock band. Accord­ing to Wikipedia.

TK: And sit down by the fire is the song I rec­om­mend of these.

Cameron: Sit down by the fire. Alright, well, there’s my lis­ten­ing for tonight. Thank you, tk.

TK: Yeah. Good.

Cameron: All right, well, that’s QAV Aus­tralia for this week. We’re gonna go and talk to the Amer­i­cans now. Uh, have a, have a quite a [01:20:00] good week.

TK: Have a have a good week and hap­py a SX and thank you RBA and watch out for elbow and send the Coali­tion to Mar­riage Coun­sel­ing.