Terra crashes and burns. Global economy next?

Adam: [00:00:25] Hello and welcome to comedian versus economist. We demystify the world of money and help you get a handle on the bigger picture. My name's Adam and we're joined, as always, by my little older brother and real life economist. Thomas. Hi, Thomas.

Thomas: [00:00:38] Hello again, Adam. How are you? 

Adam: [00:00:40] I'm doing well, thank you. Thomas, you haven't got many friends, but maybe, maybe some of our listeners do. So we'd really love it if you could spread the word of saving. Tell your friends, give us a shout out. That'd be much appreciated. Right. And review the show, too. That always helps us out as well. As always, massive show. 

Thomas: [00:00:57] Want to go for a beer sometime. Just hit me up. 

Adam: [00:01:01] We just had a conversation about how we could ask graciously for, and that was the best. We had a bit of a disagreement about how we should approach it. So I felt the need to just bring attention to the fact I was hasn't got any friends. He does. He's got a lot of friends. But anyway, that's not what we're here for. Massive show coming out though. We need to get into Aussie retail sales are booming everywhere except South Australia. Is it just because when you live in the most liveable city in the world, you don't need to fill your life with meaningless material possessions? Or is it just because the shops aren't open past 6 p.m.? We'll find out. A lot of talk about wage rises this week. We surveyed 100 people and asked them, do you deserve a pay rise? The most popular answer was, Yeah, can I smile? We'll see what Albanese and others think though. We'll also be taking a look at the war on terror. How did a cryptocurrency backed by another cryptocurrency which promised sky high returns possibly fail? And are there implications for the broader financial system? Plus, we've got more of your listener questions coming up a little later in the show. So stick around for that. You just might be famous. But first, let's get a score update on the ASX share market trading game. Thomas, how much are you losing by now? 

Thomas: [00:02:16] Quite a lot. $7,000. I'm down since. Since the start.My dogs didn't get up in the race. Yeah, that's in there. 

Adam: [00:02:28] Where are you? Where are you ranking? What's your ranking? 

Thomas: [00:02:31] 6450. So I think I'm actually up a few points from, uh, with a bullet from where I was last time.

Adam: [00:02:44] Right? I'm sitting at 5163 and I saw a little bump today, up 1.875% in the portfolio, which takes me back out to 45,000. I should point out there was I think the last time we checked in, which was a couple of weeks ago, I was sitting around 50,000, just under so I'm down about four or 5000 since then. And I do seem to recall that I made the suggestion that we should all go to cash as the Equity Mates League and hope for a market crash. In hindsight, hindsight is a wonderful thing and investing, it's a wonderful lesson there that if we'd have all done that, we'd all be much better off the where we are now. But a little bit of a bounce today, so maybe that'll continue through the week. Probably depends on what the US does overnight.

Thomas: [00:03:28] Yeah, it's been it's been a tough time for markets. Markets, uh then the wobbles from all sorts of directions. I mean the interesting thing about, about it right now is if you look at the, the latest economic data we have, it's pointing to a pretty strong economy. So everything's everything's bumping along as as as kind of as good as it gets. You like the Roy Morgan Business Survey was out that was actually picked up in the month. Despite the rate hikes, the businesses just shrug that off. We got a big bump and the accommodation and food services sector that was particularly hard hit and COVID, so that's bouncing back. They're optimistic. Retail sales spiked again in the month. They're now like 14% above trend about where they would have been if the pre-COVID trend and continued. So retail sales has boomed right through the pandemic. So it's yeah. Thumping along. 

Adam: [00:04:16] Isn't inflation a problem for retail though, are they? Why was retail kind of doing so well in inflationary?

Thomas: [00:04:23] Yeah, that's a good question. I mean, environment. Yeah, I don't know. I don't know for now. I mean, the real I think they're real numbers so I have yeah. The inflation as good as that. 

Adam: [00:04:34] As opposed to the other numbers that we've made up. Imaginary numbers like yeah I've seen retail sales. 

Thomas: [00:04:40] Come in negative one for a while. It hasn't, it hasn't shown up yet. And you know, consumers coming into, you know, coming into the rate hike, at least, you know, fairly optimistic, though, sitting on a good war chest of money as as we keep getting told. So, yeah, just retail sales bounce back. There's a lockdown prior to that. So you had this sort of lockdown sort of pivot away from services into into goods, and then lockdowns came off and so they went back into services. Yeah, I don't know. I mean, but there's a lot of money in the system. That's that's the basic story. There's just a lot of money pumped into the system. Everything's tight. Wages are rising. Job vacancies are through the roof. It's the hottest labour market in a generation. Like all of the sort of the real. Time indicators are looking pretty bumper. 

Adam: [00:05:27] Yeah. Although I did notice that the retail data, retail sales data was from March, so we're now into May. 

Thomas: [00:05:37] It's a bit. 

Adam: [00:05:37] Backwards, so we can't get too excited. Like there was a consumer confidence survey that was done just now and everyone's feeling pretty glum. So. So is it just our data that we're dealing with here that takes a while to catch up on the good times and the what we think are the good times have kind of passed by the time we're reading the data. 

Thomas: [00:06:00] Yeah, that does happen to an extent, yeah. Being an economist is always trying to steer a car by looking in the rear-view mirror and sort of down that goes. The data is pointing to us coming off a very strong period. But we're looking ahead and this is why markets have had a had a rough month or so. Is that looking ahead? There's a lot of dark clouds on the horizon. You still got the war in Ukraine. You've still got interest rates rising in the US. You've got inflation on the lift, you interest rates rising as well. So yeah, that's that's enough to give the market and sort of pause for thought and create a credit difficult trading environment, we can say. 

Adam: [00:06:39] That's interesting. I looked through some of your charts that you sent me and department stores were up big, which I think that's good. Like I was a bit concerned through COVID once everyone got the hang of like online shopping that we've just stopped going out. And so it's interesting to see the department stores are doing well, which means people are kind of returning to shop there, whereas I thought a lot of that might have moved online. Like, department stores are great for getting your size, obviously, but I didn't think people were actually buying go anywhere near what size was shooting eight and then you go and find the cheapest price online. It's kind of good, you know, like it's kind of encouraging to think that people still want to get out and shop. 

Thomas: [00:07:22] Yeah. I mean, the shopping is a unique experience. I guess it's some people really enjoy it. 

Adam: [00:07:27] So is anyone doing particularly well at it? 

Thomas: [00:07:29] It's still early days. Retailers like it's kind of like it's changing the store. Yeah, like it. Yeah. Consumer facing business is probably in a nice spot now. But then as as rate hikes start to eat into household budgets that that and put a bit of pressure on on the on consumer facing consumer staples that sort of business it Wesfarmers was out the other day saying that it's they see it as an opportunity the inflationary environment because it's just it's just a dynamic and they're well placed with their stores to grow market share so saying look as as prices rise and different different sectors sort of business efficiencies come more into the fore. And if you can stay on top of your costs better than your competitors and you can grow, grow your market share, and so that we'll see a bit of that happening, you know, they're back in themselves. 

Adam: [00:08:16] It was interesting, I looked at Wesfarmers and they've got Bunnings, Kmart, Coles and I realised that I shop almost exclusively at Wesfarmers. Like even my lithium I get from covalent lithium which stands out the Wesfarmers company. Rob Thomas. There's a lot of talk this week about raising the minimum wage. In fact, we've got a question from Jared who send us an email at Equity Mates dot com. And Gerard wanted to know if Anthony Albanese's proposal for a minimum wage increase is going to trigger a wage price spiral. So first of all, what's Anthony Albanese proposing? 

Thomas: [00:08:53] Yeah, he came out. They sort of seem to come off the cuff, but then Labour doubled down on it and sort of backed the proposal. So he's talking about. He came out and it was sort of said, do you support people getting a wage increase in line with inflation? And he's like, Yes, absolutely. And then that became more formal, saying he would go to the Fair Work Commission. So the Fair Work Commission meets every year to decide how much to increase the minimum wage by I mean not just the minimum wage, all the awards. So it tends to pass it on and typically they increase the minimum wage by and the rest of the awards by the same amount. So he sort of like threw out the award system. Everything just goes up 2% or whatever it is, right? But it doesn't have to be that way. So he came out and initiated the so then he said, yeah, I'm going to back 5.1% for award workers. And then he's like, okay, not actually just I'm just talking about minimum wage earners here. So people that are on the on the lowest, lowest levels going to get a 5.1% and that he would put in a review so that the Fair Work Commission does this review and they call for submissions and the industry groups and the unions, they all put in submissions and I think we think wages do go up this march and we think it should go up at that march and then the commission gets together and debates it and they come up with a number and that's that's what happens. Now, typically the government doesn't put in a proposal, but Anthony Albanese saying that they would if Labour wins, they would put in a proposal and they would push for a 5.1% increase for minimum wage earners, which is, you know, a pretty strong number and everywhere. And that kind of shocked people a bit. A lot of, particularly in the business community, were a little bit outraged and saying, well, this is going to create inflation and it's going to create all sorts of problems. But then labour, labour sort then was a bit like pause for a bit when they when actually no. Because if you if you're arguing against that, what you're arguing for is that many people on minimum wage or on awards should have a real pay cut. If you're not if they're not going to keep pace with inflation, then you're talking about a real pay cut. And it's not only that because it's 5.1%, but that's backward looking. So inflation's headline inflation is 5.1% now, but most economists think we're going to like six or 7% in the near term so at some point through the year. So you're not only not keeping pace with the current rate of inflation, you're actually falling behind as inflation continues to grow. So you're talking you say to argue against this proposed like this idea of a 5.1% for minimum wage, saying that is to say that minimum people on the minimum wage should have a real pay cut, that their spending power should go down. 

Adam: [00:11:30] And so that's what we hear about. We're hear about real wages pay. They will talk. There's been a lot of chatter about, you know, real wages have been declining for whatever, however long. And that's because inflation's going up. But people's the money you get every week in your pay packet isn't buying as much anymore. So effectively, you're you're getting a pay cut. 

Thomas: [00:11:50] Yeah, that's right. That's right. So if you take out inflation from then from the growth rate, then you get the real, real number. So if that, yeah. So if they got a real pay increase of 5.1%, you take out inflation and they get a real increase of 0% is what you would get. 

Adam: [00:12:06] So we raised interest rates to try and kerb inflation. So if we raise wages but then weren't that just kind of give people the money to pay the difference in the interest rates and then therefore negate the difference in, you know, raising the interest rate. So you raise the interest rate and then you give people more money. Now the interest rate rise doesn't really matter as much because everyone's got more money to pay their mortgage. Yeah. 

Thomas: [00:12:29] I mean, there is an extent where wage increases can be self-defeating that you sort of you lift wages, but then that increases costs throughout the economy, which pushes prices up. So that's the spiral dynamic. Wages go up and then some businesses push their prices up in response. That creates inflation. So then wages go up even further, which creates more inflation and you get that spiral. So that's why you talk about a wage price spiral. So you can be you can be chasing your tail to an end to a degree. It's sort of interesting because it comes at a time where the labour market is really tight. So so you were talking about the awards. There's like 180,000 people on minimum wage and another 2.6 million across 121 awards that are like all across all different industries. So it's pretty it's substantial, but it's not the entire market. And so a lot of it depends on I mean, what it is. It is true that what happens with the minimum wage determines wages throughout the rest of the economy. But I would imagine that right now the labour market is so tight that it's really market pressures that are determining wages. In most industries, it's not the it's the awards going to, you know, Thai people who don't don't have a bargaining relationship with their employer. The market's really going to determine most of what's going on in its you know, the labour market is just really tired. So there's no clear, definitive answer about how how much this creates a wage price spiral or not. 

Adam: [00:13:54] How else can we control inflation then? So we've raised interest rates. We don't want to raise wages. Well, Anthony Albanese does. So how else can we control inflation? 

Thomas: [00:14:06] Yes, this is not easy. I mean, I think I think this is what's interesting about the debate. I mean, debate in inverted commas this week in the media about this whole topic is really about like, can we afford to give people a pay rise or not? And does that create an inflationary spiral? 

Adam: [00:14:24] But you said before, business is booming. Economic, you know, everyone's driving. Economic conditions are as good as they've ever been. Surely we can afford to give people a pay rise. 

Thomas: [00:14:34] Well, yeah, I mean, that's right. That's that's the sort of to me is sort of the always the elephant in the room in this conversation. You look at a look at the costs that feed into prices, the costs sitting behind prices. There's labour costs, obviously, but then there's material costs. We know material costs are up, but we also have business profits. Business business profits are part of that story to be never hear people talking about businesses are taking too much profits. That's going to push up prices. You know, if a business has a moat and is able to push up prices, everyone's like, Hey, let's nominate their business for an award I'm buying. Add it to the watch list. Yeah. Yeah. So is there any talk about How that feeds into prices or like. Yes. And the massive government spending that we've seen and all the then the pork barrelling that's flowed into this election. So all of that, it's kind of it's a bit of a dumb debate in my mind. And it's a bit easy to to blame people on minimum wages as being the driver of inflation. It feels a little lazy to me. 

Adam: [00:15:31] The people on minimum wage aren't the ones out there buying sports cars and kind of living living it up, I would assume, unless they did really well in crypto. All right. Let's take a break there. Grab a quick word from this week's sponsor. On the other side of the break, we're going to be taking a look at the terror crypto currency situation as well as some of your listener questions. Be back soon with more on comedian versus economist. Welcome back here on comedian versus economist. You can, of course, check us out on Instagram and Facebook at CBT podcast. Thomas, I wanted to ask you about terror, not the night time terror. I'm talking about the terror cryptocurrency and its partner in crime, Luna. What on earth has been going on there across this year? 

Thomas: [00:16:18] I mean, I've read a lot about it in the last few days, and it just seems like there's so many dimensions to this story. It's it's a classic crypto story. But yeah, terror has collapsed. It's a terror was a stablecoin. So is it pegged to the to the US dollar and yet it's collapsed, it's dead. And Luna, its sister crypto currency is also dead. So it's collapsed as well. It was trading at $116. 

Adam: [00:16:44] This is Luna. 

Thomas: [00:16:45] Luna was. Yeah, yeah. Now it's zero. 

Adam: [00:16:48] Zero. It's gone. It's not zero. And in fact, I just yesterday because I started looking into this as well, so I decided to sell off some of my lower conviction crypto coins and buy a little bit of Luna. just bought about $12 worth. Yesterday of now I've got $8 worth of. Luna but if it. Returns to anywhere near its dizzying highs and and Doe Quan the founder of of Luna and Terra, he seems pretty confident he can bring this they could turn this ship around. So if he does have to say, I'm going to. I want to be in it, yeah, yeah, yeah. Take it or not. Yeah, this. Is not is not zero, but it's.

Thomas: [00:17:31] Not statistically different from zero either. 

Adam: [00:17:33] Yeah. It was a $0.20 I think when I bought it. 

Thomas: [00:17:37] All right. Yeah. I think it's Yeah. Well down on. 

Adam: [00:17:39] That. I just like being involved and I just like taking part. So what happens? So it's a stablecoin. 

Thomas: [00:17:47] Yeah. 

Adam: [00:17:48] So Stablecoin It obviously isn't a Stablecoin It's not. It's the opposite of stable or even. 

Thomas: [00:17:53] A coin actually. 

Adam: [00:17:55] Like a horse stable, maybe it was. 

Thomas: [00:17:59] Stablecoins like if people are coming new to this, so someone talked about it being like the the chips are the casino is what you play with when you're in the crypto casino, right? So you don't have to, you don't have to actually use fiat money so you can get into the crypto system uses stablecoins coins to trade in and out of trades and then when you want to cash in, then you go and go and trade stablecoins for for fiat. So that's an idea of how, how, how they work. 

Adam: [00:18:26] Yeah, it's all about like the idea I think is that you can then essentially you don't have to worry about the volatility low, you don't have to worry about the volatility of the market because it's a stablecoin. So but you get all the, all the privacy and transact ability of crypto. So you can buy things internationally, you can, you know, it becomes less and more difficult to trace these transactions and all those crypto decentralised benefits. But you get this rock solid stability of the US dollar or whatever other peg the currency you've got. 

Thomas: [00:18:58] I think that 70% of Bitcoin purchases are made using tether. Tether is like the biggest stablecoin in the market. Um yeah. In the seventies. 

Adam: [00:19:06] Which also fell off a cliff, but then that's managed to lost, it's to regain its peg.

Thomas: [00:19:11] Yeah. 

Adam: [00:19:11] And so it's now back pegging against the US dollar. But terror not so much, no. So what are the what are the implications for the crypto space? 

Thomas: [00:19:21] I mean, I think this is really interesting. I think the big one is whether these stablecoins will stay stable and like in a sort of currency sense, they're pegged like we have throughout history, we've often pegged currencies. You pegged one currency to another in terms of its value. And then the central bank, you know, maintains that value through buying and selling or whatever it's doing or capital controls. So it's kind of it's a peg. So pegs historically have often run into trouble. So the the parallel a lot of people were talking about is the exchange rate mechanism crisis back in 1992. So this is when George Soros broke the Bank of England. So the bank the pound the pound was pegged to the mark through the exchange rate mechanism. So everywhere, every all the European countries that have had it were running fixed exchange rates with each other. But it seemed everyone thought that the pound was overvalued and that it was that it needed to be needed to devalue. But what happens with a peg is you get what George Soros called a one way bet, so you can short the currency. But there's no there's no risk that the currency is going to move for the worse. You know, so you take your short bet. You bet the price is going to fall. The worst case scenario is that the peg pick holds and the currency doesn't change value at all. And then you're only up for the interest cost you've had to pay to borrow, borrow the money to for your short. But so it's like if you compare that with like when you're shorting, you know, GameStop or something or AMC, when you got that short squeeze the risk, you know, you bet that the stock price is going to fall within. The stock price goes up, you're exposed to sort of infinite. Risk there be not with a pig. The only risk is it stays steady. It doesn't actually fall. And so it creates this one way, one way bit where you can short the. This is what George Soros did. He shorted the pound. He was borrowing pounds and selling them into the market, betting that they would fall, that the pound would fall in value. If it didn't fall in value. It was just he knew what the outcome was going to be. There was no there's no risk it was going to the pound was going to go up. So it was a one way bet. And so he piled on, people saw what is doing. It created a bit of a rush. The whole forex market piled on and eventually it broke the both broke the Bank of England. The Bank of England had to raise rates. They raised it by 200 basis points in the morning and then another 200 basis points in in the evening. In the afternoon, yeah. 400 in a day. Trying it, trying to defend this pig. And eventually it was so much money betting against them that they just gave up and let the pound of the pound declared bankruptcy. 

Adam: [00:21:58] They let the pound fall. 

Thomas: [00:21:59] Now let the pound fall. Yeah, yeah. At which point. At which point George Soros's short bit then turned out to be a winner. And he banked $1,000,000,000 out of that trade. One trade, apparently the biggest, biggest trade in history. Yeah. So it became super famous and then all countries were very nervous about pigs from that point on, particularly when there's downside pressure, which that which there is. And so this is what people are talking down, that this is what happened to terror, is that there was a short bet against terror effect. It was a little bit more engineered than that through Bitcoin. But that yeah, it was an it was an attack because people didn't think it could hold because part of the way it operates, it was algorithmic. So it's not backed by anything like tether has is theoretically at least. 

Adam: [00:22:44] It's backed by luna. 

Thomas: [00:22:46] Yeah, terra. It was backed by. Luna, which is like Cryptocurrency which kind of works when, when Luna's rising. But when once Luna starts falling, then you create this desk bar would have had to print more Luna to try and prop up the currency which devalues Luna, which undermines the value of the of terror. 

Adam: [00:23:03] And because that was my that was my understanding of the situation was Luna was used as like I think they call it a governance token. Essentially, they control the price of terror by by controlling the supply of Luna. So they would just print more Luna, increase, you know, liquidity in the market, increase supply in the market, which brought the cost down, and then they would burn tokens if they needed to, to reduce supply and push the cost up. But then they they started hitting the wrong way. And so they just started like printing Luna, like it was going out of fashion, but realised that there was nobody to buy the lunar anymore. So then they just went to zero. [00:23:42][38.3]

Thomas: [00:23:42] Luna Supply went from $345 million at the start of last week to 6.5 trillion luna in circulation by the end of the week. Working. Yeah. And at that. Point they just gave up. Yeah. Yeah, yeah. I mean the funny thing is algorithmic pigs have failed already in the market. And also it's a theory. This death spiral exists in markets, in other financial instruments. So it's kind of well known. And so people have been talking about it for a while. It's not a shock like people were. People went into.

Adam: [00:24:16] This form ago. Thomas It was a long time ago that these things happen. I don't know who George Soros is, but I know what crypto is. Guarantee that the Reddit Forums that are. Spruiking crypto and the Twitter feeds we have Kenny G talking about by bullish on Luna that he's probably not across the George Soros situation. 

Thomas: [00:24:39] So I mean, that's what it looks like. Some of that some of the analysis that I'm reading is pretty condescending about the way this peg was structured, but it's like it's quite funny. Oh, mean. I'm having a good laugh. But yeah, it's, it's, it's pretty full on. But I think it's interesting because this now I think puts pressure on the other pigs. So the stablecoin so Tara had about 10% of the total stablecoin market cap tether's the biggest it saying it's 46% or something like that. But you know, if you if you can break something that's 10% of the market, like what's to stop you breaking something that's 46% and they were different structure in the sense that tether is supposedly collateralised. So you buy a one dollars worth of tether, you give tether a dollar, and then that it sticks that in the bank or it buys a treasury bond or something like that. But a lot of people are like there's a lot of red flags around. What would a business in Business Insider run an article saying that tether looks like a business? That's a quote made up entirely of red flags. And there's no. There's no auditing like there's no there's no transparency about where tether is keeping its reserves and whether it can defend itself or whether there even is the money there could be. 

Adam: [00:25:54] In bitcoin. 

Thomas: [00:25:55] Could be. Which is what Luna went and did to try and defend itself, bought a whole bunch of Bitcoin. 

Adam: [00:26:02] And then Bitcoin went down because everything because everything went down. So is there any is is there any implications here for the broader market? Like, is it is it could it spread beyond crypto or is this just another kind of crazy crypto story? 

Thomas: [00:26:15] Yeah, I think I mean, I think risk for crypto is that you see an attack on tether and this is massive, massive selling on tether until the tether has to come up with its reserves. And it depends on how liquid those reserves are. If it is in government debt paper, as they say that it is, then, then they're going to be alright. But a lot of people are saying that there's no evidence that that's the case and I think that it's they're speculating in Chinese real estate paper and things like this say it'll be interesting if, if, if there is an attack on tether because as I said, it's a one way bet. You know, tether either holds its peg or it falls. There's no downside if you're shorting or you've got the interest, your interest, interest expense. There's no downside to it. You know, and the same people people it seems that people attacked Terra. So what's to stop people attacking tether and then doing it in a group which is what Soros happened one Soros's I'm doing this everyone like yeah one way bet I'm with you like throw 20 billion at it. No worries. Yeah. So they could go after. 

Adam: [00:27:13] Tether all these snail mail followers that were. Tuned into this news newsletter if. 

Thomas: [00:27:19] Tether goes down. So tethers. Yeah. So that's, there's something like 70% of Bitcoin purchases are done into the tether's daily trading volume is higher than Bitcoin and Ethereum combined. So that's a big story in the market and a less liquid assets are worth less. That's just the general rule in finance. The less liquid an asset is, the less it's worth other things being equal. So that then puts a lot of pressure on the whole crypto space, I think. And then the question then is like, does this bleed into the financial system? And for the moment people don't seem too worried about that. But yeah, I don't know. I don't know. Like I was reading someone saying like, you know, you look at Crypto's market cap, it's down from 3 trillion at its peak last year. It's now down to just over 1 trillion. So you 2 trillion have been wiped from the market. You break that down about one trillions. You retail mum and dad investors in crypto chads, they've lost 2 trillion, but the other 2 trillion is institutional investors. And if you look at coinbase's trading volumes in 2021, two thirds of it was institutional like it used to be entirely retail, but now two thirds of it were institutional last year and going by Coinbase Exchange so and everyone was talking about how institutional players are getting in. They're going great, but those institutional players are getting burned now and they've lost they've lost $1 trillion. That in itself isn't enough to crush the economy, but it depends on how leveraged it is because you had $1 trillion highly leveraged during the GFC, that's what caused the GFC. So 1 trillion, if it's leveraged, is enough to cause some serious problems. But we yeah, we don't really know yet so yeah. Depends on that. 

Adam: [00:28:59] But could be a few more people institutionalised before this is all over. Right. All right, Thomas, we got a few more listener questions just to finish off with today. Lucy sent us a message via Instagram at TV podcast. Lucy has an election themed question. I said, Are there any stats to fact check the widely held opinion that right that the right side of politics is a safer pair of hands for the economy? Hmm. I wasn't aware of this. I thought they were both hopeless.

Thomas: [00:29:29] You're probably right. Yeah, it is a it's a. Bit of a, I think I would say myth or like at least a gross generalisation that the the right's better at managing the economy than than the left. I mean, even those terms are becoming less and less meaningful. Yeah. There's no sort of there's no way to fact check it. I mean, part of the problem is that it's very difficult to to separate economic outcomes from who's in charge at the time. Because, you know, if you look at sort of the inflation rate at the end of the year and labour takes power in May, is Labour then responsible for the inflation rate at the end of the year? It's kind of hard to make that sense, make an argument because a lot of the policy measures were in place when they took off, took office. But then at what point does Labour become responsible for the economic outcomes? Is it in 18 months? Is it in two years, three years, five years, whatever? It's sort of there's no clear point, you know, to say, yeah, this this economic result is attributable to this party and this one's attributable that party is no sort of clear way to do that. 

Adam: [00:30:34] Unless you ask the Liberals in which case it was day one. They once they won, Syriza took the reins. That was it. You ruined it. 

Thomas: [00:30:44] Yeah, yeah, that's right.

Adam: [00:30:45] And vice versa. It's not a yeah. 

Thomas: [00:30:48] So in our in our introductory series, we talked about the economic dashboard and the kind of things we care about. So unemployment rate, GDP, inflation being the big ones and you can sort of point to those. But yeah, so one is hard to attribute. Interpretation is kind of hard, but then to like how much do you even care? Like inflation could be good or it could be bad. It really depends on what's going on. And these things are kind of proxy measures for well-being, but kind of pretty loose proxies really like that. 

Adam: [00:31:16] I really think you also made the comment that the government like doesn't have that much influence over the the economy. Yeah, I. 

Thomas: [00:31:23] Don't think I don't think so in the it's overhyped. It's definitely on. Yeah, it definitely matters. It definitely matters. But it's definitely overhyped to think that, you know, there's no meeting of them getting together and cabinet going, how do we manage the economy this month? It's just not a thing. All right.

Adam: [00:31:41] Well, hopefully that's hopefully that's answered your question, Lucy. I'm not sure it has, but I think maybe even in the end, the answer. 

Thomas: [00:31:48] That is not the answer. 

Adam: [00:31:49] Is no. 

Thomas: [00:31:50] No, there's no there's no good way to fact check that. 

Adam: [00:31:52] That don't know to got there in the end. Yes sorry sorry to. 

Thomas: [00:31:56] Take such a long road.

Adam: [00:31:59] If I had a nice, short, succinct question and we will follow for 5 minutes and then said no. All right. Tiffany sent us an email CVE at Equity Mates dot com. Tiffany is looking at rental prices and wondering when the hell a rental price is going to come down. She was on the lookout, though, for some data showing rental prices over over time, over a long period of time. So we're talking decades. It seems like she can only find stuff over the last year or so anyway. You know, if we can get we can see rental data for like the last decade. 

Thomas: [00:32:33] Decade, decades, not very long. 

Adam: [00:32:47] She did Tiffany did mention that she was curious about how actually like how a $50 could be could buy a mansion in 1880. So I think I think Tiffany's after as far back as we can go. 

Thomas: [00:32:59] Yeah right. Right. Yeah. And I don't. Know we can't do 1880 what we can do. I did a little digging the CPI data has has a rent component so you can you look at that if you want to make a note of this Tiffany if you go to table seven of the CPI expenditure class. Yeah, she. Tab a one column B.S. that has rents going back to September 1972. That's that's as far back as I'm aware there's probably maybe someone's try to calculate some analytical series but man going back to 1880 like you talking we were using the pound back then. So it's a whole different currency. 

Adam: [00:33:39] Can't see any listings for the bell tower. 

Thomas: [00:33:43] In the real estate postings at the local market. 

Adam: [00:33:46] Looking to rent out my bell tower, which would serve as great as a granny flat or other short the accommodation. 

Thomas: [00:33:55] Yeah, maybe check on Airbnb. 

Adam: [00:33:57] Oh, they got Tiffany. Hopefully that answered your question. You might have to go back and listen to that bit a few times just to follow the breadcrumbs through that data. But hopefully that helps. Thank you so much for listening once again. We really do appreciate it. A final reminder to go and leave us a review and write the show wherever you get your podcasts. And of course, don't forget to check out all the other great podcasts from Equity Mates Media. Get Started Investing Equity Mates Investing Podcast. You're in good company. Talk money to me. Crypto curious and now the dive. Joining this joining the stable only recently which is great if you haven't tuned in to that yet. And of course, don't forget Finn Fest last week I said it was happening October 22nd. I don't know where I got that from. It's October the 16th. Head to Equity Mates dot com forward slash fin fest for more information. Until next week. That's all we've got for today. We look forward to talking to you again then.