Latest / What the Flux / Federal Budget winners + losers | 23andMe to sell confidential data | James Hardie's botched acquisition

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Federal Budget winners + losers | 23andMe to sell confidential data | James Hardie's botched acquisition · What the Flux

• 0:05
  Speaker 1: This is what the flux.
• 0:06
  Speaker 2: I'm Brett and I'm justin and it's Wednesday, the twenty
• 0:09
  Speaker 2: sixth of March.
• 0:09
  Speaker 1: Juzzy Boy. Meta already offers an ad free non data
• 0:13
  Speaker 1: tracking subsequent for Facebook and for Instagram, and that's in Europe,
• 0:16
  Speaker 1: but now they may offer the same in the United
• 0:19
  Speaker 1: Kingdom as well. As we know in tech juzzy Boy,
• 0:22
  Speaker 1: if you're not paying for the product, then you are
• 0:25
  Speaker 1: the product. And this might give UK users the option
• 0:28
  Speaker 1: to choose. And if it takes off in the UK,
• 0:30
  Speaker 1: certainly amount of time before it comes to Australia too,
• 0:32
  Speaker 1: you would think I will.
• 0:33
  Speaker 2: Be paying for that service, be man, fluxam. With the
• 0:36
  Speaker 2: federal budget dropping last night, we have a heap of
• 0:40
  Speaker 2: content in the Flux app tracking the winners, the losers
• 0:43
  Speaker 2: and everything in between for the federal budget. So if
• 0:45
  Speaker 2: you want to know where the spending's going, how much
• 0:47
  Speaker 2: it is, make sure to check out the Flux app
• 0:50
  Speaker 2: for all the details.
• 0:51
  Speaker 1: Three impactful stories today, juzzy Boy, let's do it for
• 0:54
  Speaker 1: our first, the Labor Government dropped their twenty twenty five
• 0:57
  Speaker 1: budget last night with some big investments and either bigger
• 1:01
  Speaker 1: deficits if they get re elected.
• 1:03
  Speaker 2: The old pre election spending is freeb Man, So tell
• 1:06
  Speaker 2: me what's going on.
• 1:06
  Speaker 1: Juzzy boy. Each year in March, the government drops its
• 1:09
  Speaker 1: annual budget for Australia's spending.
• 1:11
  Speaker 2: It's a bit like your personal budget, except we're talking
• 1:13
  Speaker 2: billions and billions in annual income from.
• 1:15
  Speaker 1: Personal income tax, payroll tax, corporate tax and Bman.
• 1:19
  Speaker 2: It also includes billions and billions of dollars in government
• 1:22
  Speaker 2: spending across health care and infrastructure and education and childcare
• 1:25
  Speaker 2: and a whole lot more.
• 1:26
  Speaker 1: And as part of this budget, the Labor government has
• 1:28
  Speaker 1: really pushed hard on healthcare.
• 1:30
  Speaker 2: It announced an eight and a half billion dollar investment
• 1:32
  Speaker 2: into Medicare.
• 1:33
  Speaker 1: With the goal for an increase in the number of
• 1:36
  Speaker 1: bulk bill doctor consultations.
• 1:37
  Speaker 2: They also announced a twenty percent cut of hex help
• 1:40
  Speaker 2: debts to ease the cost of living pressures.
• 1:42
  Speaker 1: And let's not forget a fifteen billion dollar investment into
• 1:44
  Speaker 1: childcare subsidies.
• 1:45
  Speaker 2: And be Man. With all these big investments, the Labor
• 1:47
  Speaker 2: government has warned that this election will run into.
• 1:50
  Speaker 1: A deficit after two years of budget surpluses.
• 1:53
  Speaker 2: So Beman, despite running a loss in this budget, this
• 1:55
  Speaker 2: doesn't come as such a surprise. Because Australia runs a structural.
• 2:00
  Speaker 1: Interesting so what is the key learning here?
• 2:02
  Speaker 2: A structural deficit is when the government budget is permanently
• 2:05
  Speaker 2: making a loss, even during good times.
• 2:08
  Speaker 1: That means that even when the employment rate is high,
• 2:10
  Speaker 1: consumer spending is high, and the economy is performing well,
• 2:12
  Speaker 1: we'd likely have a deficit.
• 2:13
  Speaker 2: And a Man. The Australian budget has been in structural
• 2:16
  Speaker 2: deficit for nearly twenty years.
• 2:18
  Speaker 1: Which tells us the issue isn't just short term spending.
• 2:21
  Speaker 2: Nope, it's more deeply embedded in how the budget is
• 2:24
  Speaker 2: actually built.
• 2:25
  Speaker 1: But interestingly, the two previous budgets have been in surplus.
• 2:28
  Speaker 2: And that's mainly been due to the economy actually performing well.
• 2:32
  Speaker 1: Above average, meaning higher tax receipts for the government and
• 2:35
  Speaker 1: lower welfare payments.
• 2:36
  Speaker 2: But be Man. With this election budget, Labour's going after
• 2:39
  Speaker 2: some big ticket spending.
• 2:40
  Speaker 1: Medicare, HEXTA and childcare, so we're back in deficit territory.
• 2:44
  Speaker 2: And bemaned the US, The UK, France and Italy.
• 2:47
  Speaker 1: Are also in structural deficits too, and unless structural changes
• 2:50
  Speaker 1: are made like cutting spending or boosting long term revenue,
• 2:53
  Speaker 1: the deficits are likely to stick around for.
• 2:57
  Speaker 2: Our second story. Twenty three and meters, the genetic tear
• 3:00
  Speaker 2: testing company, has filed for bankruptcy in the US as
• 3:02
  Speaker 2: it tries to sell its assets, including its highly confidential
• 3:06
  Speaker 2: customer gene data. Genetic secrets maybe up for grabs here
• 3:10
  Speaker 2: it just boy, so tell me more. Hey so. Twenty
• 3:11
  Speaker 2: three and Me is a personal genetic testing company that
• 3:14
  Speaker 2: was founded back in two thousand and six.
• 3:16
  Speaker 1: It was the first company around the world to offer
• 3:18
  Speaker 1: direct to consume a genetic testing.
• 3:20
  Speaker 2: And that was in two thousand and seven. You know
• 3:22
  Speaker 2: spin in the test tube. Send you slided back to
• 3:24
  Speaker 2: twenty three and me, and they can tell you a
• 3:26
  Speaker 2: whole host of things about your DNA.
• 3:28
  Speaker 1: It would appear that I am twelve percent Italian, somehow
• 3:30
  Speaker 1: related to a goat herder, and I'm three percent Viking.
• 3:33
  Speaker 2: They can also.
• 3:34
  Speaker 1: Show you your racial background split and a genealogical family tree,
• 3:39
  Speaker 1: which thousands of people have used to track down their
• 3:41
  Speaker 1: long lost third cousins on the other side of the world.
• 3:44
  Speaker 1: And given that twenty three and me holds this very
• 3:46
  Speaker 1: unique DNA, strong data privacy has been a key to
• 3:49
  Speaker 1: its business that've.
• 3:50
  Speaker 2: Been in over the past few years, twenty three and
• 3:52
  Speaker 2: Me has struggled to find a profitable business.
• 3:54
  Speaker 1: Model, particularly since going public in twenty twenty one.
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  Speaker 2: So now it has filed for Chapter eleven bankruptcy in
• 4:00
  Speaker 2: the US and he's looking to sell substantially all of
• 4:02
  Speaker 2: its assets.
• 4:03
  Speaker 1: Including its highly, highly, highly confidential data. Did I say highly?
• 4:07
  Speaker 2: So what is the key landing here?
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  Speaker 1: In today's economy, data is often referred to as the
• 4:11
  Speaker 1: new oil.
• 4:12
  Speaker 2: And companies like twenty three meters have built entire business
• 4:15
  Speaker 2: models around collecting the data, analyzing the data, and of
• 4:17
  Speaker 2: course monetizing the data.
• 4:19
  Speaker 1: Sometimes it can be used for research with pharmaceutical companies
• 4:22
  Speaker 1: or even advertising partnership.
• 4:24
  Speaker 2: But in tough times that confidential data can become part
• 4:27
  Speaker 2: of the liquidation process.
• 4:28
  Speaker 1: Just like office chairs or lab equipment, so for.
• 4:31
  Speaker 2: Customers be man this can become a serious privacy risk.
• 4:34
  Speaker 2: We've also seen risks of sensitive data being shared in
• 4:37
  Speaker 2: Australia recently.
• 4:38
  Speaker 1: Remember when hacker stole the personal info of Medibank customers.
• 4:41
  Speaker 2: Yep names, contact information and health records of nearly ten
• 4:44
  Speaker 2: million current and former Medibank customers.
• 4:47
  Speaker 1: So Jazi boy, It's a reminder that sharing a confidential
• 4:49
  Speaker 1: data with any company carries big risks.
• 4:52
  Speaker 2: For our third and final story, James Hardy, the ASX
• 4:56
  Speaker 2: listed global building materials company, has seen its share price
• 4:59
  Speaker 2: play after a fourteen billion dollar acquisition of arrivals.
• 5:03
  Speaker 1: Like nervously introducing a new partner to your friends and
• 5:05
  Speaker 1: getting the disapproving look. So what is going on here?
• 5:08
  Speaker 2: Okay? So James Hardy is the twenty billion dollar Australian
• 5:11
  Speaker 2: buildings material company. We'd been talking external clouding as well,
• 5:15
  Speaker 2: cement sheets, insulation pipes, all.
• 5:18
  Speaker 1: The stuff you plant to buy from Bunnings but then
• 5:20
  Speaker 1: leave to the experts. And if you've heard the name
• 5:22
  Speaker 1: James Hardy before, it might be because it used to
• 5:24
  Speaker 1: manufacture app products containing a spestos.
• 5:27
  Speaker 2: Which led to many, many, many lawsuits.
• 5:30
  Speaker 1: But now juzzy boy James Hardy has announced the acquisition
• 5:32
  Speaker 1: of a rival named Azak for fourteen billion dollars.
• 5:35
  Speaker 2: They make sustainable outdoor living products like decking and railing.
• 5:39
  Speaker 1: And this acquisition was a cash and script deal that
• 5:42
  Speaker 1: valued Azak add a more than thirty seven percent premium
• 5:45
  Speaker 1: to its last closing share price.
• 5:47
  Speaker 2: Next minute, James Hardi's share price plummeted more than fourteen
• 5:50
  Speaker 2: percent and it was clear that the invested disapproval was real.
• 5:54
  Speaker 2: So what is the key learning here in m and
• 5:56
  Speaker 2: A bigger is it always better, especially when the market
• 5:59
  Speaker 2: sees more risk than awar. So when they pulled the
• 6:02
  Speaker 2: trigger on a mega acquisition, investors were a tad spook.
• 6:05
  Speaker 2: And why was that? Be Man?
• 6:06
  Speaker 1: Because these kinds of transformational deals, as they call it,
• 6:10
  Speaker 1: often over promise and underdeliver.
• 6:12
  Speaker 2: Yeh, be Man. This deals already raised red flags to
• 6:14
  Speaker 2: James Hardy investors because the price is steep.
• 6:17
  Speaker 1: Yep forty times Azex's net profit.
• 6:20
  Speaker 2: Which is much higher than James Hardy's current valuation of
• 6:22
  Speaker 2: twenty times.
• 6:23
  Speaker 1: Its net profit and success relies on integration between James
• 6:26
  Speaker 1: Hardy and AAAC.
• 6:27
  Speaker 2: They're expecting three hundred and fifty million dollars in synergies
• 6:30
  Speaker 2: from the acquisition.
• 6:31
  Speaker 1: We choose ambitions, so clearly James Hardy's investors are voting
• 6:35
  Speaker 1: with their feet and their wallets.
• 6:37
  Speaker 2: Foxam. If you want to learn more about the federal
• 6:39
  Speaker 2: budget and the investment in healthcare, the investment in childcare,
• 6:43
  Speaker 2: and the investment in education, we have it all covered
• 6:45
  Speaker 2: with short, fite sides and easy to understand articles and
• 6:48
  Speaker 2: videos in the flux Oup. Make sure to check it
• 6:50
  Speaker 2: out for the latest scoop.
• 6:51
  Speaker 1: Thanks for listening, and we'll see you on Friday.