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July 15, 2025 • 10 mins

The RBA has recommended a ban on surcharges for debit and credit card payments in Australia in a plan to save shoppers $1.2 billion.

Kraft Heinz is weighing up a corporate break-up… only 10 years after Kraft and Heinz got together.

SpaceX is reportedly investing $2 billion USD into xAI… because when Elon borrows money, he borrows it from himself.

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Episode Transcript

Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:05):
This is what the Flux. I'm Brett and Justin and
it's Wednesday, the sixteenth of July. Josey Boyd.

Speaker 2 (00:10):
Does the number eighty six hundred and thirty mean anything
to you?

Speaker 1 (00:13):
Anything at all?

Speaker 2 (00:14):
It does well, it means a lot to the ASX
because the ASX two hundred just closed at a fresh
record yesterday afternoon. Seems like investors aren't too concerned about
Trump's latest tariffs or a decline in the Chinese economy.
It's all up, up and up, particularly in tech and healthcare.

Speaker 1 (00:31):
Interesting man, speaking of the ASEX two hundredth did you
know what gained ten point two percent in the last
financial year. It was a very big year, and we
cover off in the Flux app the top five best
performing shares from the ASEX two hundred last financial year.
There are some juicy companies in there that I personally
did not expect at all the flux am. If you're
keen to learn what the top five performers on the
ASEX two hundred was the last financial year, make sure

(00:52):
to check it out in the Flux app.

Speaker 2 (00:54):
Three non personalized advice stories today, Jazzy Boyd, let's do
it for our first the RBA has read commended a
ban on search charges for debit and credit card payments
in Australia in a plan to save shoppers over one
billion dollars.

Speaker 1 (01:08):
Australia's payment system finally entering a new era. So tell
me what is going on here?

Speaker 2 (01:12):
So you know that little fee that gets added on
top of your coffee when you pay with card, juzzy boy,
as if.

Speaker 1 (01:17):
The coffee wasn't expensive enough, b Man by six dollar
coffee ends up being six dollars and twenty one cents.

Speaker 2 (01:22):
That is a surcharge and it's meant to help businesses
cover the costs that they are charged by payment facilitators
like Visa or MasterCard.

Speaker 1 (01:29):
But b Man, Australia's payment landscape has changed a lot
since the early two thousands.

Speaker 2 (01:33):
That is right, cash is out, card is the new king.

Speaker 1 (01:36):
And now the RBA is recommending three key changes to
Australia's payment system.

Speaker 2 (01:40):
All right, Numero Uno is banned surch charges on all
debit and credit transaction and.

Speaker 1 (01:45):
That's supposed to save shoppers at one point two billion
dollars per year, or sixty dollars a year for each
card using adult.

Speaker 2 (01:51):
Next, they want banks to spill the beans on their
hidden fees.

Speaker 1 (01:56):
And finally, the RBA want Australia's major banks to reduce
their inter change fees.

Speaker 2 (02:01):
That's the fees charged to businesses by payment facilitators for
using cars.

Speaker 1 (02:05):
But be man at these changes, although exciting and not
locked in yet.

Speaker 2 (02:08):
For the next six weeks, the RBA will continue consulting
on these recommendations.

Speaker 1 (02:12):
So what is the key learning here?

Speaker 2 (02:13):
As ossies have traded in cash payments for cards, the
payment system has not kept up.

Speaker 1 (02:18):
You get this. A national RBA survey showed that usage
of cash dropped by more than half in twenty twenty two.

Speaker 2 (02:23):
Down to just thirteen percent of total payments in Australia.

Speaker 1 (02:26):
Yet be Man, we're still getting pinged fees like it's
two thousand and three.

Speaker 2 (02:31):
Aussie retailers are still being hit with a fee which
is then passed on to shoppers when using a car.

Speaker 1 (02:35):
But the question is if shoppers aren't paying the surcharge
anymore in the future, someone else will be.

Speaker 2 (02:40):
And that someone else could be businesses.

Speaker 1 (02:42):
Which puts a lot of pressure on small business margins.

Speaker 2 (02:45):
So unless the RBA also forces payment giants to lower
their fees, this policy might just shift the pain instead
of actually fixing it.

Speaker 1 (02:54):
Fox Am. Before we jump into our second story today,
you'll all know that this month in the Flex Academy
we're talking all about Lender's Mortgage Insurance in partnership with Helia.
So today we're very excited to have Sharona join us
in the pod, who successfully used Elmai to get on
the property ladder. Sharona, welcome to What the Fox.

Speaker 3 (03:10):
Thank you. It's great to be here.

Speaker 1 (03:11):
You are a property owner, congratulations on that.

Speaker 3 (03:14):
Thank you.

Speaker 1 (03:14):
When you're going into buying a property. What we were
original property goals and did they shift it all once
you looked at what was achievable in the Sydney market.

Speaker 3 (03:21):
Yeah, absolutely, I mean the Sydney market's always been really crazy.
We've always wanted to live in the Hills district in
Sydney and you know, it's unreasonable for us to do
that at this stage, so we just thought an investment
property was just a really good way to get our
foot in the door.

Speaker 1 (03:37):
And Sharona, did you know much about the concept of
rent vesting before you went down this path?

Speaker 3 (03:41):
Yes and no, we had heard about it and we
had an idea, but since then we've definitely learned more.
I mean, like you know, there's great tax benefits, then
there is also some cons there's not really stability and
you are moving home to home a bit. But I
think now the concepts much more talked about in the
media and there's definitely more educational resources of it. Then
when we first started looking.

Speaker 2 (04:02):
Definitely agree And how did you come to learn about
Lender's Mortgage Insurance?

Speaker 3 (04:06):
With Lender's Mortgage Insurance or LMI, our mortgage broker really
helped us understand and explain it to us. We had
an idea of what it is, but you know, he
really went through like the pros and cons then what
that's going to look like. And we didn't have the
required deposit, so was you know, from the very beginning,
we knew that we need to use LMI if we
want to go down this path.

Speaker 1 (04:25):
Johnnie, you mentioned you didn't have the required deposit, So
what difference did lm I make to what you thought
was possible compared to what was actually possible In the end.

Speaker 3 (04:33):
I mean, it absolutely opened the door for us to
a lot more opportunities with you know, an investment property
we weren't able to use like the government schemes. So
if we didn't have LMI, a house in the Sydney
market would have been out of the question for us.
We would have needed to settle for an apartment, which
isn't really what we're looking for, or you know, purchasing
someone like risbon on Perth, which is just a bit

(04:55):
more complicated. So the only reason we were able to
buy what we could was because we used Elmi.

Speaker 2 (05:01):
Did you and your partner have any worries about going
in with less than a twenty percent deposit?

Speaker 3 (05:06):
Absolutely, I mean you are taking a be here alone,
and there is also an additional cost involved were taking ELMI.
But ultimately, when we really looked at the numbers and
looked at the costs, we realize it's pretty insignificant. The
property growth and the equity that we've gotten from the
property has more than made up for it. And essentially
we just thought, you know, this is the only path

(05:26):
for us.

Speaker 1 (05:27):
So what advice would you give someone who's sitting on
a deposit right now that's almost enough for them to
buy a property but not quite twenty percent.

Speaker 3 (05:33):
I would say, absolutely, one thousand percent use LAMAI. But
it's the only way that works. Otherwise other options is
just saving more and by the time you say it
almost feels like, you know, houses are out of budget
again because of just growing house prices. There is an
extra cost involved, of course, but for us it was
so worth it. We're now looking into buying a property
to live in and we're absolutely going to be using

(05:55):
Elmi again. I mean if we had waited for the
last two years and didn't have the property to begin
with and be benefiting from the property growth, so we
would have really missed out.

Speaker 1 (06:03):
Awesome. Sounds like you've had a great experience with LMI. Schroiner,
and congrats for getting on the property ladder. Thank you,
thank you so much for our second story. Craft Hines
is weighing up a big corporate breakup only ten years
after Craft and Heines got together.

Speaker 2 (06:18):
Power couple know more what the Craft singles is going
on here?

Speaker 1 (06:22):
Okay? So, Kraft Heigns is a global food company. It
was created in twenty fifteen through a merger between Craft
Foods and Heines.

Speaker 2 (06:28):
Now Craft Foods being the maker of Craft Macaroni and Cheese,
Philadelphia Cream Cheese, as well as Oreo and Ritz.

Speaker 1 (06:35):
Heines is obviously the maker of the famous ketchup the
baked Beans as well as Golden Circle here in Australia.

Speaker 2 (06:40):
Now, this mega merger was backed by Man the Myth,
the legend, Warren Buffett and his firm Berkshire Hathaway, but
be Man.

Speaker 1 (06:46):
After a decade as a committed family unit, Kraft HNS
is reportedly planning to split itself into two.

Speaker 2 (06:51):
Who gets custody of the cheddar cheese Jesse Boy.

Speaker 1 (06:55):
In the one business they would have their high growth
condiments and sources.

Speaker 2 (06:58):
In the other business they would have grocery staples like
cheese and meats.

Speaker 1 (07:01):
What's the reason for this potential Slipbeaman.

Speaker 2 (07:03):
Well, there has been rising competition from private label brands
from supermarkets.

Speaker 1 (07:07):
And also a big shift towards healthy foods or no
food at all yep.

Speaker 2 (07:11):
Weight loss drugs like ozempic a squeezing big food brands globally.
So what's the key learning here? Is a time for
merging and a time for demerging, and a time to
acknowledge your cheesy dreams didn't quite pan out as expected.

Speaker 1 (07:23):
When Craft and Heines came together in twenty fifteen. The
goal was to build a global consumer goods.

Speaker 2 (07:28):
Powerhouse, one that could compete with Unileva and Neslite.

Speaker 1 (07:31):
Think he was bigger, equals better.

Speaker 2 (07:33):
But nearly a decade later, it turns out some parts
of the business have pulled their weight Hello Heines sources, while.

Speaker 1 (07:39):
Others like Oscarmeia Meats are lagging behind.

Speaker 2 (07:42):
In fact, by twenty nineteen, just four years after the
merger out Kraft Heines wrote down the value of some
of their brands by more than fifteen billion US dollars.

Speaker 1 (07:49):
On top of that, the share price has lost more
than sixty percent since the merger.

Speaker 2 (07:53):
So now, the idea is that by splitting up the business,
it could give each division the chance to shine on
its own. And it's the example of a split up
recently b Man, where we saw Kellogg's split up its
business into Kelenova, which owns snackety snacks like pringles and
pop tarts, while wh Keller co owns the US serial business.
So Juzzy Boy, Well, mergers can promise synergies. Sometimes the

(08:15):
cleaner story is two separate businesses.

Speaker 1 (08:18):
For our third and final story, SpaceX is reportedly investing
two billion US dollars into Xai because when Elon Musk
borrows money, he borrows it from himself.

Speaker 2 (08:28):
Forget bank loans. Musk's idea of fundraising is just asking
himself nicely, tell me more.

Speaker 1 (08:33):
Okay. So SpaceX is the aerospace company over four hundred
billion US dollars.

Speaker 2 (08:38):
It's got some pretty grand ambitions to establish a human
colony on Mars, just quietly and launch internet all over
the world via Starlink.

Speaker 1 (08:45):
Another one of Musk's companies is Xai.

Speaker 2 (08:48):
That's his answer to open Ai, which Musk did co found,
by the way, but then he rage quit open Ai.

Speaker 1 (08:54):
Yep, but b man controversy aside. Xai is planning to
raise another five billion US dollars.

Speaker 2 (08:59):
And surprise, nearly half the mulla is coming from Elon's
other business, SpaceX.

Speaker 1 (09:04):
Is all part of his strategy of cross pollinating his empire.

Speaker 2 (09:07):
And it's fair to say, juzzy boy Elon has become
the master of related party transaction.

Speaker 1 (09:11):
So true, So what is the key learning here?

Speaker 2 (09:13):
A related party transaction is when a company does business
with another business or party that is closely connected. It
might be a major shareholder, an executive, or in this case,
another company controlled by the same person. He's essentially using
one of his most successful companies, SpaceX, to bankroll one
of his most speculative companies, Xai.

Speaker 1 (09:30):
And Juzzy Boy.

Speaker 2 (09:30):
In public companies, these deals usually involve a full review
of the deal by directors and sometimes a bit of
a vote, but on the SpaceX and Xai deal, Musk
doesn't face these hurdles because they're both private. So this
investment between SpaceX and Xai will just be another way
to blur the lines between Elon Musk's ventures Fox. The
ASX two hundred.

Speaker 1 (09:51):
Index gained a open temporary two percent in FO twenty five.
We cover the top two performing companies that are both
from the same industry in the Flux app this month.
If you want to learn a little bit more about
the best performance of FY twenty five, make sure to
download the flexapp and check it out.

Speaker 2 (10:05):
Thanks for listening and we'll see you on Friday.
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