Vinyl market spins out of control. Should central bankers be worried?

HOSTS Adam & Thomas|20 July, 2021

Meet your hosts

  • Adam

    Adam is the funniest and most successful comedian in his family. He broke onto the comedy scene as a RAW comedy national finalist before selling out solo shows at two Adelaide Fringe festivals. He’s performed stand-up to crowds all over Australia as well as enjoying stints on radio with SAFM and most recently as a host of the Ice Bath on Triple M. Father of two and owner of pets, he may finally be an adult… almost.
  • Thomas

    Thomas, the economist, is the brains of the outfit. He studied economics and game-theory at the University of Queensland and cut his teeth as an economist at the Reserve Bank of Australia. He now runs his own economics consultancy, with a particular focus on the property market. He lives with his wife and two kids in the hills outside Byron Bay.

The unemployment rate dropped down into the critical 4-point somethings, but what impact will lockdown have? How on earth are houses cheaper to buy than rent in 3411 suburbs? Why is Henry broke, and what are the jolts in the vinyl market really telling us? All this and more on this week’s Comedian v Economist.

Keep up to date with the charts of the moment on the Comedian V Economist instagram

If you’ve got a question for Thomas… or Adam… then go ahead and send them to cve@equitymates.com

Any views expressed by the podcast host or any guest are their own and do not represent the views of Equity Mates Media or any other employer or associated organisation.

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Adam: [00:01:09] 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. [00:01:21][11.8]

Thomas: [00:01:22] Yeah, gday, everyone. How are we? [00:01:23][1.1]

Adam: [00:01:24] Very well, thank you. Today on the show, we're going to be asking Thomas with Apple announcing their entry to the bar an hour pay later space by an hour later, customers richer than we think. We're going to find out where it's cheaper to buy a house than rent. Why are vinyl record sales going through the roof, Thomas? We'll get to that a bit later. But first, unemployment data out this week. Thomas, what did we learn [00:01:50][25.6]

Thomas: [00:01:51] as another strong, strong result? Unemployment down to four point nine percent, continuation of a theme we've seen over the past six months or so. So generally robust numbers, strong job growth, particularly full time growth, participation rates holding up. So all the positive signs you want out of the jobs market and the unemployment rate down now to four point nine. So we're into that critical four point, something to remember about six to nine months ago, I think it was that Phil Lowe said, you know, it's going to keep interest rates low and keep pumping out the money and to get that unemployment down to four point something, Josh Frydenberg came out and back that up, saying he wanted something similar, like mid fours. We're now into that four territory. [00:02:31][40.3]

Adam: [00:02:31] So, yes, I'm sorry, David. I said four point something. I'm guessing it wasn't four point nine that no one's no one's changing course on four point nine, are they? [00:02:40][8.7]

Thomas: [00:02:41] No, no, no. We're not we're not saying [00:02:43][2.1]

Adam: [00:02:45] they're not busting out the champagne at the at the RBA. [00:02:48][2.9]

Thomas: [00:02:49] Mission accomplished. Accomplished. No, no, no, no. It's part of it's part of the three things are looking for that unemployment is a four four point somethin's. And that's to give us wages growth in the three point somethin's. And that's to get inflation into the two point. [00:03:04][15.4]

Adam: [00:03:04] Something's really unscientific. Well, yeah. Yeah. Why don't they just say 4.5 and call it like even if we're going to be that vague about it, just go smack bang in the middle and make it. They're targeting 4.5 or does that tie them down too much. [00:03:21][16.1]

Thomas: [00:03:21] A little bit because you might get a four point four. And is is that underneath? And one decimal point, the dollar is just not that accurate, you know, so you sort of like you want to talk in broadband's because. Yeah, because when the data came in at four point nine. But the true unemployment rate, remember, is just based on a sample. So it's just like there's a lot of statistical error in this so that, you know, the true the actual unemployment rate, if you if you did a census of every employed person in the country, it might be 5.2, it might be four point six. You don't you don't know. It's somewhere around four point nine, but we call it four point nine and [00:03:58][36.6]

Adam: [00:03:59] one and hopefully no one notices. Yeah, yeah. That that there's been a lot of lockdowns obviously happening of late. Sydney, Melbourne, Adelaide, Adelaide. Well, not yet. We've got we've moved to stage four restrictions as a recording today or Monday, but obviously there's a lot of a lot of impact from that. But that's not included in this data, is that right? [00:04:20][21.7]

Thomas: [00:04:21] No, no, we haven't seen that. We did. We did see. So the Sydney lockdown's that's not in this data yet. So that's going to be interesting next month to see what that does to it, particularly because we don't have all the job keepers wound up. So what we saw in Victoria, I've got a chart here and I'll post this to Instagram, if that's still blowing up the Internet. Oh, it's [00:04:40][19.1]

Adam: [00:04:40] huge. Yeah, massive. People love the charts. CBA podcast if you're looking for it on Instagram. On Facebook. [00:04:46][5.4]

Thomas: [00:04:46] Yeah, it was actually. Yeah, yeah. So what we saw in the Victorian lockdown's is that in the absence of job keeping, the hours worked, fell about eight per cent, but the total employment was steady. So what that means is the employers were hanging onto their workforce. The employment relationship was intact, but they were dialling back the hours and people were working less hours. [00:05:08][21.3]

Adam: [00:05:08] Is that because. So that's because of job kaper and or job keep a job job seeker as well. But job keeper primarily. So people you're saying people are working less hours, but they're still employed, they're supported by job keeper? [00:05:21][12.9]

Thomas: [00:05:22] No, I think it's I think it's more that the lockdown's are seen as temporary and that if you're running a business and you want to know you locked down, you're hoping that in a month's time you're out of lockdown and you're ramping up activity again. So you don't want to then be like you don't want to fire or your workforce at the first sign, a lockdown and then three weeks later have to rehire entire workforce. So that flexibility comes with just like winding back the hours and then then picking things up again. [00:05:48][26.0]

Adam: [00:05:49] Yeah, I was certainly working less hours or as my employer calls it, working from home. [00:05:53][4.2]

Thomas: [00:05:55] Yeah. So it'll be interesting. I mean, the, the labour market is is very tight and is getting tighter. Look, I've got another chart opposed to you [00:06:03][7.6]

Adam: [00:06:03] to go to a star here and he charts his firing around the [00:06:06][3.3]

Thomas: [00:06:06] other one. But the unemployment. Right to the vacancy ratio, so the unemployment number of unemployed people to the amount of open jobs, so the vacancies, job vacancies available, available jobs, that's now at the lowest level in 10, 10 odd years, I think. Yeah, I she was at Bianna back to ninety six. We got that data four. So that's the lowest level on record going all the way back to nineteen ninety six [00:06:32][25.7]

Adam: [00:06:33] all the way back. You're right. You're right. You were talking about all the way back to talking about whether going back to like you know, seventeen hundred and twelve all the way back does not apply to 1996, [00:06:48][14.8]

Thomas: [00:06:49] not 20 or 25 years is quite a that's quite a that's an old data set in economic terms. Yeah. My statistics don't last that long. They get like GDP goes back 50 odd years, but the definitions change and data series are reimagined and they get structural [00:07:04][14.5]

Adam: [00:07:04] rake's the definition of all the way back change. That's what's happened. [00:07:07][2.8]

Thomas: [00:07:10] Yeah. So things should keep keep on tightening, but it is going to be interesting to see what effect Sydney has. So Sydney accounts for a quarter of the Australian economy and a sizeable chunk of the workforce. So if they're locked in a pretty deep lockdown, it's not it doesn't look like it was sort of even reached a turning point with Sydney yet. So that could start unwinding that that could start eating into those job figures and making things a little worse. The RBA actually said, well, no, they didn't say someone in the Australian reported that the RBA in this might have been a leak. We don't know. But the RBA is ready to go back to five billion a week money printing. Remember when we talked last week that the RBA wound things back, that they were printing money at a pace of five billion a week? They dated back to four billion, but they're now sort of seem to be saying that they were willing to go back to five billion if things go a bit rocky as early as August. So as early as next month, the [00:08:05][54.7]

Adam: [00:08:06] money printing is when you're creating money from thin air. It doesn't it doesn't take a lot to turn that ship around. You can literally just go just delayed that for over there, is that one and put it forward. What type of what type of five they go five billion. Now we have more money. Right. A lot of flexibility in monetary policy. So I did have I was wondering, like you often hear, hear about unemployment and we all think that that presumably is good. Right, because everyone in society has a job or more people have jobs. And if unemployment's lower than that, that's good. Are there any negative impacts that come from low unemployment but unemployment, does it have any flow on effects that kind of can create a problem or we could. [00:08:51][45.1]

Thomas: [00:08:51] Nah, nah. It's pretty good news story to get to be counted in the unemployment data. You need to be actively looking for work. So you need to be someone who's looking for a job and sad story. You can't find one. So if the unemployment rate's going down, it means that everyone who's out there looking for a job is finding jobs. So if you decide to step out of the workforce and go on holidays, then you just you're just not counted in that data. So the unemployment rate going down doesn't mean we're forcing people into the labour market. And that's a bad thing or anything. It means that people who want to work are able to find work that's good. And where it might be, it's sort of a super tight labour market. Then wage costs go up typically. So wage wages start to increase. And if they if they get a run on, then you might argue that that's that's bad for the economy. But but it's also not clear in court. So, like, the sort of like you can divide up the economy into the profit share and the wages share and they typically eat into each other. So they got a sort of some to one. And so if wages goes up and there's more wage, workers are getting more of the slice of the pie and that means there's less going to capital. You know, where you stand, where you how you feel about that depends on where you sit on the political spectrum. [00:10:03][72.2]

Adam: [00:10:04] Yeah. Okay. I did have one other question. I like I know a lot of people in the arts, a lot of comedians. Where do they fit into all this? A lot of them. I guess that technically they're self-employed. I mean, not not everyone, you know, not everyone's lucky enough to have a podcast that brings in literally tens of Dollars every month like I do. They're not kind of looking for work, so to speak. But they when things shut down, they suffer, you know, actors and singers. And when when cities lock down their avenues for for money making disappear. But they don't really sort of do they fit into that that unemployment jobs figure. [00:10:40][35.9]

Thomas: [00:10:40] Anyway, the numbers come from a survey which says, did you were you working this this past survey period. Okay. So you define that whether you're self-employed, like so myself, I'm self-employed. So I would I would count even though I don't have an employer who's paying me a wage, I would still be counted as employed. [00:10:58][18.1]

Adam: [00:10:59] Just busking for economics on the street. Do you chart [00:11:03][3.8]

Thomas: [00:11:08] some fresh chat? [00:11:08][0.5]

Adam: [00:11:11] Sit down, sit down and say, I'll do a caricature of you a sharp fall [00:11:14][3.3]

Thomas: [00:11:17] and then to be unemployed again, it's like, did you if you didn't work, were you did you actively look for work and did you want to work? Were you ready to start work? And if you select. Yes. To that, so it's sort of self nominate so that so you say your mates would, you know, could if they were asked in this survey, could nominate themselves as unemployed. Oh, that [00:11:36][18.5]

Adam: [00:11:36] would offer to do a gig that they'd do a quick type. Five days out. They survey the quick ten minutes instead of every ten bucks, say whatever. Do a shout out to all the artists and people out there who are doing it tough, along with everyone else is in his enduring more and more lockdown's across the country. I hope you hope you're keeping well, Thomas. Also, I read you sent me this headline that said it's cheaper to buy than rent in three, four, one one suburbs and I couldn't work it out. Why is rent so expensive in Peterborough, New Zealand? Postcode three four [00:12:16][40.1]

Speaker 1: [00:12:16] one Petero New Zealand 034 [00:12:21][4.7]

Thomas: [00:12:22] isn't it. Isn't Victoria in the three not? [00:12:24][2.0]

Adam: [00:12:24] Well it is, but I don't think there's a town that has three or four one to give us a sense a message. Comedian CVA at Equity Mates Dutko Equity Mates dot com forward slash CVA. If you're a three four one one somewhere in country Victoria, I think the postcode is assigned to country Victoria, but as far as I can tell, the closest of my extensive research Dollars was Putera Zealand. [00:12:49][25.1]

Speaker 1: [00:12:51] God yeah. [00:12:52][0.9]

Thomas: [00:12:53] No 3407 suburbs irresolution. I see. I see. I see what you did there. You know, the CoreLogic releases saying that in three thousand four hundred eleven suburbs around the country, it's cheaper to buy than to rent like [00:13:08][14.9]

Adam: [00:13:08] are we talking mortgage repayments are less than rentals. Is that [00:13:11][2.8]

Thomas: [00:13:11] that's. Yeah, yeah. Yeah. So they, they figure are they, they estimate the price of the house is worth and they estimate the rent that you would pay on that, that property, even if it's not a rental. And then they compare the two. So assuming eighty per cent over and two point five percent interest rate. Something like that. Yeah. Right. And then yeah. And if the, if the cost of servicing the mortgage is less than the rent, then they say it's cheaper to buy than rent. [00:13:36][24.3]

Adam: [00:13:36] That doesn't necessarily mean it's easier to get into the housing market than to rent in the housing market. But the rent in this market. [00:13:42][5.9]

Thomas: [00:13:42] Yeah. So this is the big thing that it ignores is the deposit. So it assumes that you have a deposit ready to go. [00:13:47][4.7]

Speaker 1: [00:13:49] Right about about looks like it's cheaper to [00:13:53][3.8]

Adam: [00:13:53] buy a Ferrari than it is to buy a Datsun, assuming you've been slowly paying off your Ferrari since you were born and you've got five hundred dollars left to pay. [00:14:00][7.7]

Thomas: [00:14:01] Yeah, it's a little bit flawed. I mean, again, way back when in 1996, when they started this [00:14:07][5.7]

Adam: [00:14:08] year, it wasn't such a [00:14:09][1.4]

Thomas: [00:14:09] big deal like it was the deposit wasn't such a massive hurdle like it is now. Like, right. Servicing costs have come down. And it is true, it's it's cheaper to service a mortgage than it is to rent. And a lot of places, the real the real barrier to buying property is the is the deposit these days, which is which is gone, gone through the roof relative to to incomes. And so that's that's where the real pain point for people by trying to get into into a property is that deposit. But but didn't used to be that way like twenty odd years ago. It wasn't it wasn't that hard to save the deposit. It didn't take it didn't take you that long. [00:14:43][33.4]

Adam: [00:14:43] Right. What's the outlook then? Is it is rents going to come down? I mean, interest rates are going to go up, which means that then servicing the loan will become more expensive. Is it going to. [00:14:52][8.6]

Thomas: [00:14:53] Yeah, so it's a one in three thirty six point two per cent properties across the country are cheaper to buy than rent. So that's one in year, one in three that's up from thirty three point nine percent is awkwardly is also one in three, but slightly smaller, one in four. So that's up. And that's because there's two there's two things going on. Rents are going up and interest payments are going down because because interest rates are going down. So the two sides of that equation. So rents are moving against it and interest rates are coming down. So at some point, rents will probably level off. I mean, they're growing at a record pace at the moment, like, oh, hi, space in over a decade, six percent a year or something. At the moment in regional areas, this thumping along some in some capitals are growing in like high double digits, sixteen, 18 percent or something. So Ren rents are soaring at the moment. [00:15:48][54.9]

Adam: [00:15:48] But you've said before, you've said before they aren't tied to the house, to house prices. [00:15:52][3.5]

Thomas: [00:15:52] Right now. The causality runs one way. Yes. So higher higher rents lead to higher house prices, but higher house prices don't lead to higher rents. OK, because you think about the rent is the return on the asset. So if the return goes up, then the value of the asset goes up. Yes. That's sort that's so those higher rents will translate into higher prices, which will then translate into higher interest payments, which will then bring that ratio back into line. So I think I think we'll come back from that 36 percent back towards that. Thirty three percent through higher, higher house prices. [00:16:24][31.5]

Adam: [00:16:24] Have you got any data on Peterboro, New Zealand? [00:16:26][1.8]

Thomas: [00:16:27] I don't I don't I [00:16:28][1.0]

Adam: [00:16:28] don't know are listening in New Zealand. But I know we do have some listeners. I thank you for tuning in. [00:16:33][5.1]

Thomas: [00:16:34] Yeah, well, the other thing about these data is that it's that those cheap in quotation mark houses are primarily located in regional Australia. So ninety four point six per cent of homes in Townsville are cheaper to buy than rent. Seventy nine per cent in Toowoomba, eighty eight point eight per cent in Cairns or Rahner in regional New South Wales is eighty nine point one per cent. And then if you go into Sydney, what is it like in Ryde at zero point seven percent, one point one per cent in the inner West, one point three per cent in the northern beaches? Well yeah. Right, yeah. So real. A real, real difference there. [00:17:15][40.6]

Adam: [00:17:15] Yeah. I feel like we do need to add like that little disclaimer at the bottom of those super advertisements, you know, like we need a little disclaimer that's like assuming you've got a deposit, you know, when looking at these numbers, if you haven't got one, it's time to hit up your baby boomers. Okay, Boomer, I need a deposit because it's cheaper to buy than rent, assuming I've got that sorted. Yeah, yeah, yeah. [00:17:35][20.4]

Thomas: [00:17:36] Tell them. Tell them. Covid told you. [00:17:37][1.4]

Adam: [00:17:37] As I tell you, Dad is say good luck with it. Let us know how you get on. It will be broadcast on Facebook and Instagram. Tell us how how your conversation with your dad when you ask for a deposit because it was cheaper by great. Gosh. [00:17:56][19.2]

Adam: [00:19:06] Welcome back here on comedian versus economist and Thomas, we're hearing 60 percent of Henries are living paycheque to paycheque. That's my friend Jane and and her son Henry, who I know are both big fans of the show. But I'm guessing Jane Sun's not what we're talking about here, Thomas. [00:19:21][14.8]

Thomas: [00:19:22] No, no, no. So this is this is a survey coming out of America looking at millennials and their spending habits and found that what they call the Henries is the acronym high earners not yet reach, sorry, not reach yet. That's the generalisation is rich yet. Yeah, that's you. Henries, where do [00:19:41][19.3]

Adam: [00:19:41] they come up with this stuff. [00:19:42][0.6]

Thomas: [00:19:43] Yeah. And it's like the the dinks double income. No kids. [00:19:46][3.4]

Adam: [00:19:47] Yeah. But at least that wasn't like a name like they must have had that name first and then just worked in some words to fit it. [00:19:54][6.8]

Thomas: [00:19:54] Oh yeah. [00:19:54][0.3]

Adam: [00:19:55] Yeah, yeah. Could have been a nodule. You often get everything else later. Assiri Everything else is hyphenated. It was like the banks, [00:20:06][11.0]

Thomas: [00:20:06] the professional aunt. No kids [00:20:08][1.8]

Speaker 1: [00:20:10] had [00:20:10][0.0]

Adam: [00:20:11] no kids. [00:20:12][0.4]

Thomas: [00:20:12] Yeah. Yeah. The market has logged onto that realised that they were responsible for a lot of a lot of purchases with like their nieces and nephews. Right. Really. And so, yeah, like became a became a sort of a character to market to. Right. Yeah. And that's yeah. So that's, that's where our Henries come from. Yeah. But this survey out of the US by a payment company found that, yes, 60 percent of them earning 100 hundred grand plus six figures is one hundred and thirty four thousand in Aussie dollars, a living paycheque to paycheque. So just not saving anything, right. [00:20:43][30.7]

Adam: [00:20:43] Well, that's not much is 100 Graddy. That's not that's not enough to get by on. You know, there's a minimum five different streaming service subscriptions now, minimum the [00:20:54][10.9]

Thomas: [00:20:57] time [00:20:57][0.0]

Adam: [00:20:59] you've got every year that you and kids, I got no dependency that is living paycheque to paycheque that like I need some I need some some streaming in my life, you know, seasons upon seasons. [00:21:12][13.3]

Thomas: [00:21:13] But now we are working this right. There's two things going on. One hundred thousand dollars doesn't go as far as it used to. That's probably true. And yeah. But like also like I'm presuming most of these are coming out of university. Another study found that the average Henry leaves university with a debt of eighty thousand US dollars. Right. So that's a that's a big hole to be starting out your career in, you know, work for a long time to pay that off course. [00:21:37][24.7]

Adam: [00:21:37] We don't keep stylometry. Just stay another year with your folks, punch out that debt crush. Yeah. Now, that is that's a fair that's a fair whack. [00:21:47][9.3]

Thomas: [00:21:47] That's a fair whack. Yeah, yeah. Yeah. But there's also what I talk about lifestyle creep. So it's really hard to I mean this this is sort of across the spectrum. This isn't just for high income earners or for young people. It's people across the spectrum have difficulty staying on top of their burden. You remember, like savings comes out of your you earn and you burn. You need to be earning much less than you're earning to be able to save anything. [00:22:10][23.3]

Adam: [00:22:11] What are you, the barefoot investor that's before. Yeah. Is there any way to do that for him? [00:22:17][6.4]

Thomas: [00:22:18] Yeah, I reckon I don't know if he came up with it, but. Right. Yeah. Yeah it is definitely in his book. Yeah. But you, you got to stay on top of that birthmothers is like there's a whole marketing industry dedicated to getting you to burn more than you need. And it's really hard not to because if you're earning good money then you want to be living in the right neighbourhoods and driving the right cars and all the business. Yeah, it's [00:22:42][23.9]

Adam: [00:22:42] I come up with another acronym for [00:22:44][1.2]

Thomas: [00:22:44] that Myer. [00:22:44][0.6]

Adam: [00:22:45] It's Max maintain affluence, xylophone. I couldn't think of anything for that. Right. So it's a living paycheque to paycheque that we mentioned at the top of the show. The Apple has just announced Apple Pay later, which worst marketing name ever, but they're entering the by now pay later space as seemingly like every big player is now like PayPal announced pay for. We've already got Afterpay zip about 100 other by now. Pilatus is that kind of is that does that Marriott really well with the Henrys, do you think? Is that kind of what's supporting the bar now pay later space. [00:23:24][39.0]

Thomas: [00:23:25] I think, I think that's what I, what I, what I started thinking about with this, like I presume buy now pay later was, you know, targeted at lower income earners with people who don't have enough money to buy the goods they want in the moment. But I think this shows us that that it's going to appeal to high income earners as well, and that it's not just your basic staples and low end consumer goods that are going to go on on buy now, pay later, but potentially higher, higher, higher up the sort of luxury spectrum. Right. For, you know, Ferraris or whatever might end up on buying our pilot. And you can. But, you know, I mean, so we're not just talking about a lower socio economic group that's going to. Customer base for the buy now, pay later, but it might be right across the consumer spectrum. Hmm. [00:24:10][45.9]

Adam: [00:24:11] You might say, Thomas, that that it appeals to all people, which is planned expenditure, otherwise pilade of everything else. Now, as the right to quit while you're ahead, I start we had probably some time around the start of this show where we might move on because there's big news, Thomas, that affects, you know, probably a lot of Henries there. I say, but where we've got a vital shortage, Thomas is the it's the biggest boom in vinyl since flooring in the 80s. And it's vinyl records in particularly. Can't get them. [00:24:52][40.6]

Thomas: [00:24:53] What's going on? It's gone off year. Yeah, well, yeah. So demand surge with covid. So vinyl sales were up almost 30 percent in 2020. Yes, a huge jump. I've got a chart here. I'll share that with to the Instagram as well. Yeah, but gone vertical in 2020, and that's probably just gone even higher in 2021 so far. So, yeah. So just a huge surge in demand for the vinyl. And so I think the industry sort of saying that people it's all the money that people would have spent on concerts. People are now just putting into into the record collections. And because they're spending time at home, you can sit around this and listen to this, listen to some music. [00:25:32][39.1]

Adam: [00:25:32] A lot of people must have taken it up. They like I didn't go. I can't get out to see Green Day anymore. So I guess I'll go and buy some vinyl, like, I'll just play it on on Spotify or whatever. Yeah. [00:25:45][12.6]

Thomas: [00:25:45] Is a bit tenuous. Yeah. I don't know. I mean, yeah it's, it's booming. Maybe it's a bit like nostalgic or. Yeah. I don't know it's maybe it's, it's, I don't know. Is it the expense. Is it the inconvenience. I don't know what the pulling power of vinyl is. [00:25:59][13.5]

Adam: [00:25:59] Yeah. Right. Maybe it's like everything old is new again. Right. Like everything. The fashion is cyclical. Like mallets are back in now. So Mullet's are back in maybe such as vinyl. [00:26:08][9.2]

Thomas: [00:26:09] Yeah. Who knows. But whatever the case it's booming. But a one one music executive, a billboard was quoted as saying that pre Covid the we had a global capacity to manufacture one hundred and sixty million million albums a year. But to me, what the album, what the market wants right now, we need to be producing somewhere between three hundred and twenty and four hundred million now at least double the capacity. And so this is this is sort of a classic inflation story. And a lot of what we're seeing is that what we're seeing Covid triggered a massive sudden shift in consumer behaviour and the supply chains just weren't ready, just the production just wasn't able to come online and meet demand. [00:26:51][41.8]

Adam: [00:26:51] It seems a really strange reaction to Covid like, you know, people panic buying, toilet paper and stuff like that forever now never goes a viral back in my life. You get some records, Spillane's some. The vinyl scene is a strange reaction. I don't know. Do I invest in cassette tapes now? Like, is that the next the next phase of this feels like I finally only if there was some way we could play these while we were out and about [00:27:24][32.8]

Speaker 1: [00:27:29] a [00:27:29][0.0]

Thomas: [00:27:30] woman's Walkman to do a comeback. [00:27:32][1.3]

Adam: [00:27:32] Walkman's I know girl over it. I read a quote from that article. It was like so the guy said we even had a new signing we're really excited about for twenty twenty one. But because of vinyl delays, the artist has to sit on their record until 2022 and wait till it gets released. What have to wait. Like if only there was another way to distribute music in 2021. Like it sounds something's gone a bit skew here has it like. [00:28:04][32.0]

Thomas: [00:28:05] Well I think, I think streaming has monsted the market. Like I think if you if you're a music musical artist, you know, you get nothing out of Spotify. If you're an indie artist, the Spotify gets you nothing per play. So like there's no point releasing it for free because, you know, you get nothing for it. So so vinyl is sort of like there's a tangible product there. People are willing to pay for it because they get you know, they get a good hit of nostalgia with their with their album. Yeah. And it's it's a way to make some money to sell a product. You're not going to sell a CD CD's that have any of that like that. Kudos. [00:28:41][35.6]

Adam: [00:28:41] Almost like selling a band T-shirt that you can listen to. Yeah. Like yeah. You're into, you know, like you get that thing that's like cool, I've got this I can put on my show and show my friends or whatever I heard, I heard like Amazon and those big chains are getting into it as well, which must be putting more pressure on supply. [00:28:59][18.0]

Thomas: [00:29:00] Yeah. They're cashing in Target. Walmart, yeah. Yes. And they now account for 13 percent of. It was up from four percent in twenty eighteen. Yeah, so they're getting they're chasing that money, too. This is a demand story. [00:29:13][12.7]

Adam: [00:29:14] So all the mainstream stuff will be on their like, you know, and can you get Lady Gaga on vinyl? I guess you can [00:29:21][6.9]

Speaker 1: [00:29:21] actually get the Wiggles [00:29:22][0.6]

Adam: [00:29:24] cough medicine the way it was before the show. If you can get a AVADO limited release vinyl pressing of big red car [00:29:31][7.3]

Speaker 1: [00:29:33] so [00:29:33][0.0]

Thomas: [00:29:34] that I mean, my kids love, we've got a record player and I love it because it's like it moves. It's got moving parts. You going to move the needle on it makes a huge noise if you bump it. [00:29:44][10.1]

Adam: [00:29:46] Oh, I would let my kids anywhere near my record player if I were my youngest. Anyway, she's going to say, yes, I do. She loves that. She's got all these old C.D. lying around. She's kind of discovering music through this this little Siri player that she's because, yes, she can just grab him out playing and she doesn't need Internet access, would have to worry about straying onto YouTube and watching some some weird Atami from God knows what is and always ends up there. Yeah, well well, you know, we must get a question probably every week. Thomas on the email. Savea at Equity Mates dot com. When can I get the Comedian versus Economist podcast on vinyl and. Bad news, you have to wait until at least 2022, unfortunately, but we will keep trying. So in the meantime, we hope you'll keep tuning in to the podcast wherever you might be listening to it. And that kind of I think that brings us to the end of the show, Thomas. [00:30:44][58.7]

Thomas: [00:30:45] Hmm. Sounds good. Yeah. [00:30:46][1.2]

Adam: [00:30:46] And that's why we do really appreciate you tuning in. Check us out podcast on Instagram and Facebook, CVA at Equity Mates, dot com or on the website, Equity Mates. Dot com forward slash. KVIA loved bringing you the show this week. We look forward to you tuning in again next week. We'll see you then. [00:30:46][0.0]

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