June 19, 2025 • 34 mins
One in three Australian investors now have crypto, and that includes an estimated $1 billion inside the SMSF sector alone.Bitcoin is up more than 40 per cent over the last year...it's time to reconsider 'digital gold'.
Author and family office director Jacqui Clarke joins Associate Editor-Wealth, James Kirby in this episode.
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In today''s show, we cover
- Why has crypto jumped again?
- The big end of town gets involved
- How it still fails the 'intrinsic value' test
- Beyond betting...the post-Trump scenario
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:09):
Hello, and welcome to The Australian's Money Positive podcast. I'm
James Kirkby. Welcome afore everybody. My guest today is Jackie Clark.
She's a Charge of Accountant, a Family Office board member
and author of a very successful book, Stop Worrying About Money,
which she has reminded me to remind you, has now
won several awards since she was on the show the
(00:31):
last time. But she's also particularly good on investment markets
and I've wanted to talk to her particularly, and I've
wanted to talk to you particularly about crypto. Now. I
know we've had people on about crypto regularly and bitcoin,
and to some extent it's been what we say. Some
(00:53):
listeners have thought I've been a bit dismissive of crypto.
I haven't. I've been terribly skeptical about crypto to a
point I have to say not anymore. By that, I
mean there are things happening, particularly at the top end
of the market, particularly the world that Jackie Clark operates in,
that I think will really make you reconsider the whole
(01:15):
area if you haven't already about deeply.
Speaker 2 (01:18):
How are you, Jackie, I'm great James on this brisk
morning brisk.
Speaker 1 (01:23):
Morning, indeed brisk morning and Melbourne as well, I can
tell you that. But you know, I've been thinking something
cut my arm. I mean a few months ago. I
think the outstanding thing that I noticed was amp unlikely
perhaps of all the big institutional managers, was, as I understand,
the first fund manager to formerly buy a crypto. They
(01:44):
bought bitcoin. And then I saw a fascinating piece a
couple of days ago where Amazon and Walmart are talking
about issuing their own crypto coins stable coins, that is
the come convertibook two dollars. And then this morning, just
so happens, this morning, JP Morgan is launching They're all
(02:08):
crypto coin, and I think something really is starting to
happen inside financial markets. What tell us your review as
a conservative investor, I expect tell us your view.
Speaker 2 (02:22):
Bitcoin. I don't invest in it, I don't have clients
who invest in it. I have friends, though, who chat
about it, and some who play with it. I guess
the big question with bitcoin is it's some type of
economic bubble? Is it? And people often talk about it
as the online goal, but perhaps the bit that's the
(02:44):
difficulty I find with it. And you know, one of
the things I talk a lot about when we discuss
things like financial literacy. My caution to people always is
doing your due diligence on the investments. So don't invest
in something you don't understand. And it is very difficult
to get to the bottom of what the bitcoin actually represents.
(03:05):
And so sure conscious that AMP and others, including super
funds in Australia have started to contemplate bitcoin or actually
add bitcoin to their portfolios. And is that perhaps just
a why is it a way of diversifying risk? I
don't know the answer to that, but perhaps the bigger
question is what does it really represent? And there is
(03:28):
some contemplation that it's considered a treasury asset, but it's
not cash and if the bitcoin price drops, your cash
has gone. Now that's not a treasury asset as far
as myself is a chartered accountant would consider. So it
represents lots of conflicts in it. Yes there is, yeah,
I know, including with the energy usage and everything else.
Speaker 1 (03:51):
Sure super funds I read now have there's a billion
dollars Australia inside look self managed super funds. It our
so many people are taking I think they're just taking
a bet that the fear of missing out. That's my
gut feeling. But just looking at it a little bit
deeper as to why it may become more important because
(04:14):
it's becoming embedded in the financial system and the way
perhaps we might ever have imagined. I mean, first of all,
you have Trump talking about going into the strategic Reserve
in the US, which is extraordinary. He's totally pro crypto.
But more than that, when you see the majors and
when you see JP Morgan entering the market, it tells
(04:36):
you there's more going on than simple bitcoin betting.
Speaker 2 (04:41):
Yes, perhaps it has stood the test of time. You
could argue perhaps since its introduction, it has generally increased.
Since its introduction, there is a limit apparent limit to
the supply when the system was established, which I kind
I've find fascinating as well, because with the bermin Ai,
(05:04):
I would expect that bitcoin per se would actually grow.
So with this limited market, I think it's one hundred
and twenty one million, so to speak, and I think
we're only at not even at twenty percent penetration yet,
is that right? We're under twenty million, I think, So
we've got a long way to go in this market
of picking up this coin for one of a better word.
(05:27):
So I guess there's potentially it, but it does feel
like it does feel like a bet. And if you
were looking at a portfolio spread, this would be The
people I work with won't go near it.
Speaker 1 (05:37):
They will go neared state.
Speaker 2 (05:38):
It isn't a case correct. Yes, So the advisors, certainly
in say Sydney Melbourne markets who look after wealth, are
not going near bitcoin. They may on request if you
say that's what I want to hold because I think
there's something in it. It's very speculative in the context
of traditional investment. You know, it's not not bricks and water.
Speaker 1 (06:00):
There exceptions in the family officer, high networth.
Speaker 2 (06:03):
No, only in terms of attitude, which is what it
comes down to you, doesn't it. So if you're a
betting person, if you're if you've got horses, for example,
bitcoin might be just adjacent to the racetrack.
Speaker 1 (06:15):
That is. That's the skeptical view. Really, yeah, but I'm
just looking at a little bit, just taking it a
little bit more central and economic and saying, well if Amazon,
Walmart and JP Morgan in the last couple of weeks
have announced their plans to issue their version of stable coins,
(06:36):
which are convertible to dollars, right, So it hasn't got
that wildness to it, right, So it's pegged. And then
if they can find economies of scale or productivity gains
from that, then it is a different story, isn't it
to some expect And maybe bitcoin is just a proxy
for all this activity. But even if it is, then
(06:58):
it's then it becomes a different piece. Truly.
Speaker 2 (07:01):
Yeah, it's still going to be very difficult. And I
made I guess I made that almost joke about horses
and horse racing. But at least with the horse racing,
you've got a horse. I'm still unclear with bitcoin what
you've really got and what does that mean to you
in terms of value compared to me. But again, whilst
the predictions are that it will rise, the question remains
(07:23):
what kind of treasury or monetary asset is it? And
the worst thing about it for US individuals, us mere
individual investors is if we lose the data, if we
lose the bitcoin, it's gone. It's not like we have
a deposit in the bank and there's a balance that
says you've got one hundred dollars, it's gone. You've basically
(07:44):
lost it. So if you lose if you store your
data off site somewhere your bitcoin and you lose the
password or you lose the device. Yep, if you lose that,
it's gone done. So there's some perhaps risks like that
with it that people may not be considering. And someone
like Buffett is obviously famously said he's never going near bitcoin,
(08:05):
and he continues to support that view and look at
you can't. Not everyone agrees with him, but that's a
particular point. And I think in the context of someone
like Trump, the federal reserves in a pretty tough spot.
I think we all know, and perhaps like most things
with Trump, it's a bit of distraction.
Speaker 1 (08:23):
Right you think it's a decoy from the broader issue
of US deaths, US dollars. We won't go there because
I want to take a short break. And what I
wanted to come back to is that the access to
bitcoin and crypto is changing so rapidly, and we can
go in now through ETFs and to some extent that's
commoditized collateralized. We don't have to worry really if someone
(08:46):
loses the key to their particular crypto holding. That's one thing.
And also when we just look at at the opportunities
across the board. We're seeing more and more people coming
in from all angles on this and we just want
to pick up on what is it? Is it gold,
is it correlated? Is it just another ascid that generally rises,
(09:06):
or is it non correlated? Which was the original proposal.
If you like that, you could take bitcoin and it
would serve you when traditional assets go awry. But I
wonder about that. Let's talk about that in the moment. Hello,
(09:28):
welcome back to The Australian's Money Puzzle podcast. James Kirby
here talking to Jackie Clark. Now, Jackie, let's just look
at the other part of this that. First of all,
you were talking about advisors don't like it, but advisors
love ETFs, and money has been pouring into crypto ETFs
and all the major ETF houses have crypto and this
gives everyone a sort of an easy way in. So
(09:51):
the advisor will say, look, I don't know anything about
bitcoin or those exchanges, but there is an ETF you
can use. And of course, in saying so, the ETF
takes all the boxes from a regulatory point of view.
So the advisors okay with that. The client says, well,
that's an easy way in, just like ETFs or an
easy way into everything. It's a commoditized liquid, conventional asset,
(10:14):
which is actually packaging and nonconventional asset. But it has changed,
hasn't it. It's taken the bitcoin and crypto play from
the margins into the very center, which brings us back
to what we said at the start of the show.
A billion dollar in SMSs, a billion dollars in crypto
in SMSFS now and key funds like AMP a sort
(10:37):
of an icon for all its feelings of major institutional
money in Australia. So does that change things?
Speaker 2 (10:47):
Well, it doesn't change it for me. But perhaps if
there was an asset class that you didn't represent, and
perhaps that's the question that these organizations have asked themselves,
which is this an asset class that we should hold?
And there's no doubt a lot of demand for it,
and in terms of perhaps the nature of assets going forward,
this could be representative of more of the types of
(11:08):
assets we might have access to in the future.
Speaker 1 (11:11):
What are you thinking there? What are you think of that?
Speaker 2 (11:14):
Just the context for me is really about information and
how powerful access to information or data is, and it
always has been getting access to data information, so perhaps
there's something more in the marketability of that down the track.
And so this is also something that's a little bit mysterious,
is it not. And given it's had such a good
(11:35):
track record, I think that it will demonstrate appeal to
people because of the quick gain. I guess, you know,
I'm saying, I guess because it's difficult for me to
get on board with it because I'm having trouble. Maybe
I'm materialistic and I'd like to see something from my
money other than again exactly. So yeah, still is it's
(11:58):
not regulated, right, so it still is pretty rough.
Speaker 1 (12:01):
It's increasingly regulated, though, particularly in the world's most important
money market, which is the US. And there's two things
I'm thinking of. One is that it seemed to me
for a long time there was two types and I'm
going to generalize here dangerously. I'm sure that there was
two types of investor that were very interested in crypto
and bitcoin. There were people who actually didn't engage in
(12:26):
conventional markets anyway, and they saw this as a new thing,
basically a new thing that they could get an edge
in this, and they didn't actually have shares properly, but
they had bitcoin, and there was often this market were
much younger. They were online Sammy et cetera, et cetera.
But then there was another market which were very sophisticated investors,
(12:47):
the very top of the tree, and they wanted to
know everything about it. And they see it, they see
looting to use single names. But there are prominent investors
in our own market. There's very many problems to best
result this indus. Mark Carnegie obviously been standing I suppose
an earlier and people will say, well, look, Mark Carnegie
has got right so many times, he must know something
(13:10):
I don't know. So so I think this, first of all,
there's that dichotomy between who who is prepared to back
it and get involved and learn it. But what I
want to ask you is whether this idea of the
general idea that it's an alternative and so that it's
so you mentioned that the very stars the idea of
digital gold. How do you view that proposal.
Speaker 2 (13:32):
Yeah, I mean I think there's it's got some lenks
to it in the context of it being this online asset. Yeah,
and look, maybe if you're proactive with it, I mean,
it's recognized as a currency that you can trade for things.
And perhaps if you were able to do that, and
that could be used in your own business model somehow
(13:54):
that might also have some additional value to you. But
again I think it requires then to understand that market
really well and recognize where you can trade the bigcoin
and what for? And does that is that all value
to you? Because quite? I mean if you can have
a product or an asset that growsing value quickly and
you can offload it quickly for something else, then I
(14:16):
see some benefit in that, which perhaps is where someone
like Mark can tubby.
Speaker 1 (14:21):
Do you see it as a correlated asset? And folks,
I'm sure just to make that clear, what we're saying
is the jury is still out. It seems above bitcoin.
I mean, it's established now, it's an acid class. I
don't think it's going to go. I think we assume
that it's got for our lifetime. It's going to be here.
It's been severely tested in many ways. It survived all
those tests. So let's take that on put that on
(14:42):
the table. But then the issue is whether it's digital goal.
And if it is, that would mean that basically, if
markets crumbled, if currencies in the US dollar classic case,
that the US dollar in ten years time is a
sad reflection of what it is was ten years ago
to say or and in that context, then the proposal
(15:06):
is that bitcom will stand alone, basically that it will
be like gold, it will be they will win. That's one.
That's the non correlated asset argument. And then the outariasive
argument is it's just becoming. It's just another asset. And
if the markets are good, it's good. The markets are bad,
it's bad. We haven't got a sufficient track record have
(15:26):
we really to test that? So it's simply live debate.
Where are you on that one, Jackie?
Speaker 2 (15:34):
I guess only a bit what's been fifteen years, It's
been around four now, so there's not a lot of
evidence that it's very short periods.
Speaker 1 (15:42):
But it's part sufficient volume and interest to we even
stand as some sort of proxy with gold.
Speaker 2 (15:50):
Yeah, and look, I find it fascinating with the market
to how some things don't always hold value like they should,
even when they've got brilliant balance sheets. It's just that
can humor sentiment where people are at and it might
be the same with bitcoin. But there's still I guess
a lot of growth potential in bitcoin. And if in
fifteen years we're at under twenty percent takeup of what's
(16:13):
available there. It's got a long way to go from
growth potential in terms of accessibility, and so perhaps it
will become more normal and I think, as you say,
with the likes of amp, Walmart and Superinneation, fun State
starting to pick it up or recognize it as an asset,
that maybe helps normalize the mystery a little bit.
Speaker 1 (16:33):
But I'm not.
Speaker 2 (16:34):
Any clearer that the mystery has shifted, and so does
it move with the markets. I don't know. There's a
whole lot of evidence that it has at the moment.
Speaker 1 (16:45):
There's a lot of you're seeing there's lack of evidence
that it's correlated. Correct, So you're suggesting this non correlated
well implication.
Speaker 2 (16:54):
It's yes, that's how I would see it.
Speaker 1 (16:56):
Okay, that's interesting, right, Okay, So since we're talking about
that and the markets, it seems to me obviously here
we are at the end of just to switch gears
for a moment and bring us back into a conventional,
traditional space where we are more sure. Yes, well, value,
(17:17):
that's what you're looking for, isn't this. You don't like
the fact that there's no intrinsic value there isn't it
really for me?
Speaker 2 (17:23):
That's right? Yeah, absolutely, yeah. It's very hard to be
a nausey and say any other way.
Speaker 1 (17:30):
Actually, well gold, I mean, what's the intrinsic value of gold?
Speaker 2 (17:34):
Yeah, well, I mean that's a genuine mineral, isn't it gold?
Speaker 1 (17:38):
Okay, but it gets it gets a down high price
for a genuine mineral.
Speaker 2 (17:42):
Doesn't Yes, yeah it does. It's done really well. But
I probably won't be going there either.
Speaker 1 (17:48):
Okay, very good. So just on the market. It's what
I have you because you have a finger of so
many pies, fingers, so many pies. I'd like to just
see where you're coming from in that. Our market here
we are right coming to the end of the financial year,
shares a up eleven percent, the average balanced super funders
out thereat point five percent. How on earth this wasn't
(18:10):
supposed to happen with the market? Is our market is
now a point where the most positive forecast at the
start of the year said it might reach by December.
What's your view on the share markets?
Speaker 2 (18:25):
Yeah, it's a good time. It's a really good time
to have this conversation. It's there's a broadly positive view
of the market now we are in an unusual spot.
The tariffs aren't settled and our bow needs to get
his meeting.
Speaker 1 (18:39):
At some point.
Speaker 2 (18:41):
But perhaps we're a little fish in a big.
Speaker 1 (18:43):
Sea enough priority.
Speaker 2 (18:45):
Yes, so there's definitely some positives that we have and
perhaps the Reserve Bank has certainly now got some genuine
sort of firepower. The RBA is in a good spot,
and I think with the disruption, if you like, between
the US and China, Australia generally will benefit from that
tariff war, if you like, because people will start will
(19:07):
be the beneficiary of that.
Speaker 1 (19:09):
Tell us a bit bit more as to how.
Speaker 2 (19:11):
Just in terms of the way trade will work, we
will be saying as probably easy pickings as a partner
in that respect. Yeah, and perhaps, like I say, it's
a bit of a distraction, we're a bit easier to
deal with in the context of those tariffs, so we
simply should benefit and that would come down to what
items we're trading with each party. But I think we
(19:31):
benefit from that, right, Yeah.
Speaker 1 (19:34):
Do you think that to some extent that depends the
buoyancy in the ESX.
Speaker 2 (19:38):
I think that's definitely out there. But perhaps the other
option is that if money leaves the US, it might come,
it might find its way here. Now there's two reasons
why you invest in Australia. We have a fairly narrow band,
which is really banking and resources. But that's a good
reason perhaps to have your money leaves, for example, the
(20:02):
US and come to Australia. So that could be an
upside benefit of.
Speaker 1 (20:05):
With the US institutions are buying come bank at a
one hundred eighty.
Speaker 2 (20:10):
Dollars would be one of the reasons. Yeah, So that's
something that I think would be appealing for people to
come to Australia. But typically when I think about sort
of revenue sources, most Aussie companies have a lot of
domestic revenue as well less overseas revenue. So perhaps we're isolated.
(20:30):
So we have it's so like the pros and the
cons of being isolated this.
Speaker 1 (20:34):
Time or this sort of til it's.
Speaker 2 (20:36):
Almost independence in its own way.
Speaker 1 (20:39):
The banks are domestic, aren't there.
Speaker 2 (20:41):
They are.
Speaker 1 (20:43):
Domestic focus.
Speaker 2 (20:44):
Yeah, So if you were looking that's right and narrow
your investment focused or isolate impact of particular things such
as US China tariff arrangements, then that's something you can
do through an Australian asset so, so there could be
some upside from that for Australia. But we're in a
pretty good spot right now with the RBA, and I
believe that the China and the US wherever that conversation goes,
(21:08):
I'm sure it's going somewhere that neither you know, China
won't be happy with. Then they'll respond accordingly, but might
have a slightly deflationary impact as well, which again is
good for US. So I think that strengthens the RBA's
position as well. So yeah, so, I mean it's all
it seems generally good, and that's in the absence of
anything more serious happening on the world front.
Speaker 1 (21:31):
I know it's a tough question, but it doesn't five
founded or so markets up eleven percent over twelve months,
it's up four percent for the year, and we get
four and a half. It's up four and a half
for six months. I should say, you know for the year.
The calendar of today's checking your four percent evidence, les's
three eight percent already. If you stopped right now, selling
(21:53):
mayn't go away. I know it's tuning, but do you
think this is as good as it gets? Is the
room for for are?
Speaker 2 (22:01):
You know there's no crystal ball that can respond right now.
There's too many sort of geopolitical matters occurring that could
have any number of impacts. So it's just very hard
I think for anybody like it always is.
Speaker 1 (22:15):
Really it sounds like you're not you're certainly not saying
this market is this market's want too fast or anything
like that.
Speaker 2 (22:22):
No, No, because there's evidence that there's wind in it
or puff in it, wan, a bit of puff in it.
Speaker 1 (22:28):
Actually the wind is behind it. Perhaps, is that perhaps
where we're coming from as.
Speaker 2 (22:35):
Opposed to we will it's not a wet sile put
it that way.
Speaker 1 (22:42):
Okay, very interesting. I've got really good questions this week, folks.
I've selected some absolute corkers, I think, and I want
to have Jackie on board when I'm dealing with them,
and we will be back in the board. Hello, Welcome
back to The Australian's Money Pustle podcast, James Kirky with
(23:03):
Jackie Clark. Who is, may I say, a chartered accountant,
she's a tax advisor. She's a member of the Institute
of Company Director, she's an author. She's a board member
on some very interesting private family office boets. Hence the
sophisticated view on the market. Okay, quickly, Ryan, who actually, Ryan,
(23:26):
We're not dealing in any great detail with your question,
but you actually kicked off the whole concept of today's
show about bitcoin. Ryan had originally asked he had basically
met the point that the price some of the crypto
related investments were going so well. He told that he
couldn't believe that the money puzzle hadn't covered it yet.
(23:47):
So hopefully we've met a start Ryan, on that of
what I would call the post Trump crypto reality, which
is quite different I think than the pre Trump crypto scene. Okay,
and asks your article in the Australian, which was by
the way, the seventh of June says industry funds pulled money,
but all investors taxed in the same way. This was
(24:09):
my piece where I was just saying that the nature
of industry funds and how they are, how it all works,
is that the tax is polled. Consequently, folks on the
new supertax, that polling of requirements, tax requirements. I mean,
(24:30):
some people are going to be better off in big
industry funds simply the older ones with lots of money
will in some way cross subsidized the younger ones who
are in the same fund. This is a particular issue
for funds where there is a lot of older, wealthier members,
and we actually had a list of the top ten
(24:52):
funds with the most exposure. My broader point on all
that is that no one escapes this fund. No one
escapes this tax Division two ninety six because it's a
new At face value, it's a simple fifteen percent tax
that's a new one on top of the original taxes
and super it only affects people with more than three million. However,
(25:14):
in reality it's going to infect a help a lot
more people than that because it's on realized games, which
is just completely daft I think as a way to
tax people as personally and Treasure shows no sign of
changing on that, and more importantly, is not prepared to
index it, and that means a lot of people are
(25:35):
going to get caught in it very quickly as the
years go by and people say, oh, you are scare mongering.
These always get indexed, No, they don't. The sophisticated investor,
for instance, requirements are unchanged for twenty years. Division two
ninety three tax, which is another super tax on high
salary earners is unchanged. I think it's for twelve years.
(25:58):
There's no rules about this. I just wanted to that
also stem there jacking. Is there anything else anything you
want to add to that?
Speaker 2 (26:05):
No, probably just to answer question. I know that just
in terms of calculating it and understanding how to work
through it yourself, to get your head around it and
how members in big funds might be impacted. The Association
of Superannuation Funds of Australia has given quite a bit
of guidance on the impact of Section two ninety six
and I've had look at the different calculations they're provided.
(26:26):
They're quite helpful instead of explaining this, but I think
you hit the nail on the head with your article actually,
you know, indicating how assets are pulled for the benefit
of all members. But actually even the administration of this,
all the costs of this will actually fall on the
weight of all members of super funds to some extent
to the end of the day additional compliance any organization has,
(26:48):
somebody has to pay for that.
Speaker 1 (26:50):
So when i's to be for it exactly, and I
think you know, I hope you know you know. And
one of the things you did mention was that you
know is had nothing to do with with two net
six most but in fact it permeates it. It does
perculate right through the system. I hope I've met that
clear and as sincerely mean it.
Speaker 2 (27:09):
That's the other thing just add to that giant is
I think I've determined what something like half a million
salaried employers around Australia are actually impacted by.
Speaker 1 (27:17):
The super immediately.
Speaker 2 (27:19):
It's quite substantial. Yeah, immediately, and I will baying big
fans I were all being self managed fans by a
long shot.
Speaker 1 (27:25):
Yeah, but this is a key point I was making
that it was aimed at self managed superinvestors without a doubt.
But it is the nature of it, this construction of
onrealized gains and then the nature of how big super
funds work mean they are pulled into it. They are
complaining much, but I better complaining behind the scenes. Okay, Andrew.
(27:47):
Interesting question from Andrew. Great question Andrew. He says it
would be good to talk about the virgin IPO later
this month and so detail and to compare it with
other recent large years, and to discuss the impact on Quantus,
which has touched eleven dollars and it's paying dividends for
the first time in years. Okay, Marvel's question so interesting
(28:08):
the virgin ipo. This is what I think about the
virgin ipeo in three numbers. It's listed at two fifty
the first time, and when it was taken off the
boards it was nine cents. It's coming back at two
ninety three after that. It's a question of this. I
have no idea what you think of it watching.
Speaker 2 (28:27):
My Headshine, which the listeners, well, well, I think the
first thing pats for Andrew is I don't think it
was a retailer. For it all only to holdstyle investors.
So it's it's all being taken up for starters.
Speaker 1 (28:41):
It's a tiny it's a tiny amount, which is right.
I won't say a trick, but the mathematics of when
you float a tiny amount of stock, it's not to
waye about it. The price gets supported easier, let's be
yea yeah.
Speaker 2 (28:53):
So Baying came in with evaluation two dollars ninety and
morning Star came in with evaluation at two dollars sixty.
So perhaps that's an indication of where things might head.
But you know, the question is it is a they've
taken advantage perhaps at the time, so it is relatively buoyant.
If you look at the trends coming out of the
COVID era and you look at all the statistics on
(29:15):
Australian travelers, there's definitely been a rise. I think we've
pretty much met, if not exceeded, there's sort of pre
pandemic times of travel. So it is the right time,
is it opportunistic? So have they taken advantage of that?
I'd be interested to see, mind you, if the implications
of Israel, Iran, Ukraine and so on may start to
(29:37):
have the reverse impact on the airline world as well
all people, perhaps because I'm feeling less inclined to travel
as a result of what's going on, because it's pretty
hard to avoid the Middle East when you fly out
of Australia. Yes, exactly.
Speaker 1 (29:51):
They have to go around to Ukraine. They have to.
Speaker 2 (29:53):
Yeah, so look, and that may be a small thing
in the scheme of just having to get around the world.
We've all got family to visit, paper all things.
Speaker 1 (30:01):
Happen, I mean, yeah, I mean more pointedly, the history
of the Second Airline in Australia is woeful. And I'm
sure these are great people. I'm sure they've got it
in a great shape. I don't doubt for a moment
they've optimized their moment and their numbers for the float
goes without saying, here's the thing. Answer collapsed, Virgin Mark
one collapsed. Brokers not brokers. To be fair, researchers Morning
(30:23):
Star are already saying this, this float is too high.
Speaker 2 (30:26):
Yeah. I would agree with that, and we've got to
meet a bit careful. Yeah, well I can't. Sorry, I
can't see how you can because it may may have
been at its peak.
Speaker 1 (30:37):
Okay, very good, we will leave it right there, Andrew,
I think the answer is very clear. None of this
is investment advice ever. It's information only, and I'm sure
you all know that. Okay, final question, fam Sam, as
I said in really good questions today, I was hoping
you can explain to me how I can deal with
the suspended trading stock in my portfolio.
Speaker 2 (30:59):
It's actually a great question to have. If he mentioned this.
Speaker 1 (31:02):
One, there's no point actually naming it because there's plenty
of them out there. There's a whole part of zombie stocks.
And he says it's been suspended for years. My money,
you're stuck in this. I can't sell it. What are
my options.
Speaker 2 (31:12):
This is really frustrating if you've ever been this position
with suspended training stock, because you can't take crystallize the
capital loss from a tax perspective until it's actually liquidated.
And so there is a small little opportunity. There's a
these be a company which I think still exists called
the listed dot com dot au. You can go on
(31:33):
to that website and see getting up to date read
on what's happening with the company. You might be able
to take that information to your accountant to determine whether
it's realistic that you can actually take that crystalize. You
can crystallize that capital loss from a tax perspective, so
that might be the thing to do. Obviously you need
to continually review it. But it's very frustrating. It does
(31:54):
happen often.
Speaker 1 (31:56):
How does it work. Does it run to zero obesity
or a zero point one center or something?
Speaker 2 (32:01):
Oh sorry, when they're suspended your main yeah?
Speaker 1 (32:03):
Or is it valued at the amount that was suspended.
Speaker 2 (32:07):
That's a good question. I wouldn't know that. I'd have
to look at each individual case actually to work that out,
and you can obviously the conservative approach is whatever they
close that you could take a loss to that level
and then do a subsequent loss, you know, take a
reasonably arguable position, which is what the Australian tax officers
would be looking for in the situation. But technically, until
it's actually in liquidation or formally wound up, you actually
(32:30):
can't do anything. It's very annoying so here, but you
could at least do some research.
Speaker 1 (32:36):
You have value and possibly possible in there, especially if
it was the nineteenth of June and you had two
weeks to go try and find so and I hear
that the markets up eleven percent.
Speaker 2 (32:49):
People may be doing to find.
Speaker 1 (32:50):
As usual one maybe, yeah, especially with our market. Yes, yeah, yeah,
Well it's a good time so we're able to say
that terrific. Hey, look, thank you very much, Jackie. Great
have you on the show again.
Speaker 2 (33:01):
Good to be here, James, thank you.
Speaker 1 (33:02):
And the book Stop worrying about money, which you somehow
manage time to rise on top of everything else. You've
won a couple of awards for it, a.
Speaker 2 (33:11):
Few international awards. It's been incredible. Actually. The last one
was the Money Awareness and Inclusion Award Program, which is
a global awards program, so forty five countries participating. They
announced it out of Singapore about a month ago, which
is wonderful.
Speaker 1 (33:26):
Are you shipping vast quantities out around the world now?
Speaker 2 (33:30):
Of course maybe Amazon is, I'm not.
Speaker 1 (33:36):
It is the royalty checks from financial books. We've had
some fun with those on the show before. Let's see
that you couldn't live on. Not worth the conversation, barely
relevant in your tax returns. All right, very good. Thanks
for a lot, Jackie Clark. Great to have you on
the show. We're talking again soon. Thanks James, and thank
you everybody. And great question today. Keep them rolling the
(33:57):
money puzzle at the Australian dot com dot a talk
to yourself Sam the Room sub
Hello, and welcome to The Australian's Money Positive podcast. I'm
James Kirkby. Welcome afore everybody. My guest today is Jackie Clark.
She's a Charge of Accountant, a Family Office board member
and author of a very successful book, Stop Worrying About Money,
which she has reminded me to remind you, has now
won several awards since she was on the show the
(00:31):
last time. But she's also particularly good on investment markets
and I've wanted to talk to her particularly, and I've
wanted to talk to you particularly about crypto. Now. I
know we've had people on about crypto regularly and bitcoin,
and to some extent it's been what we say. Some
(00:53):
listeners have thought I've been a bit dismissive of crypto.
I haven't. I've been terribly skeptical about crypto to a
point I have to say not anymore. By that, I
mean there are things happening, particularly at the top end
of the market, particularly the world that Jackie Clark operates in,
that I think will really make you reconsider the whole
(01:15):
area if you haven't already about deeply.
Speaker 2 (01:18):
How are you, Jackie, I'm great James on this brisk
morning brisk.
Speaker 1 (01:23):
Morning, indeed brisk morning and Melbourne as well, I can
tell you that. But you know, I've been thinking something
cut my arm. I mean a few months ago. I
think the outstanding thing that I noticed was amp unlikely
perhaps of all the big institutional managers, was, as I understand,
the first fund manager to formerly buy a crypto. They
(01:44):
bought bitcoin. And then I saw a fascinating piece a
couple of days ago where Amazon and Walmart are talking
about issuing their own crypto coins stable coins, that is
the come convertibook two dollars. And then this morning, just
so happens, this morning, JP Morgan is launching They're all
(02:08):
crypto coin, and I think something really is starting to
happen inside financial markets. What tell us your review as
a conservative investor, I expect tell us your view.
Speaker 2 (02:22):
Bitcoin. I don't invest in it, I don't have clients
who invest in it. I have friends, though, who chat
about it, and some who play with it. I guess
the big question with bitcoin is it's some type of
economic bubble? Is it? And people often talk about it
as the online goal, but perhaps the bit that's the
(02:44):
difficulty I find with it. And you know, one of
the things I talk a lot about when we discuss
things like financial literacy. My caution to people always is
doing your due diligence on the investments. So don't invest
in something you don't understand. And it is very difficult
to get to the bottom of what the bitcoin actually represents.
(03:05):
And so sure conscious that AMP and others, including super
funds in Australia have started to contemplate bitcoin or actually
add bitcoin to their portfolios. And is that perhaps just
a why is it a way of diversifying risk? I
don't know the answer to that, but perhaps the bigger
question is what does it really represent? And there is
(03:28):
some contemplation that it's considered a treasury asset, but it's
not cash and if the bitcoin price drops, your cash
has gone. Now that's not a treasury asset as far
as myself is a chartered accountant would consider. So it
represents lots of conflicts in it. Yes there is, yeah,
I know, including with the energy usage and everything else.
Speaker 1 (03:51):
Sure super funds I read now have there's a billion
dollars Australia inside look self managed super funds. It our
so many people are taking I think they're just taking
a bet that the fear of missing out. That's my
gut feeling. But just looking at it a little bit
deeper as to why it may become more important because
(04:14):
it's becoming embedded in the financial system and the way
perhaps we might ever have imagined. I mean, first of all,
you have Trump talking about going into the strategic Reserve
in the US, which is extraordinary. He's totally pro crypto.
But more than that, when you see the majors and
when you see JP Morgan entering the market, it tells
(04:36):
you there's more going on than simple bitcoin betting.
Speaker 2 (04:41):
Yes, perhaps it has stood the test of time. You
could argue perhaps since its introduction, it has generally increased.
Since its introduction, there is a limit apparent limit to
the supply when the system was established, which I kind
I've find fascinating as well, because with the bermin Ai,
(05:04):
I would expect that bitcoin per se would actually grow.
So with this limited market, I think it's one hundred
and twenty one million, so to speak, and I think
we're only at not even at twenty percent penetration yet,
is that right? We're under twenty million, I think, So
we've got a long way to go in this market
of picking up this coin for one of a better word.
(05:27):
So I guess there's potentially it, but it does feel
like it does feel like a bet. And if you
were looking at a portfolio spread, this would be The
people I work with won't go near it.
Speaker 1 (05:37):
They will go neared state.
Speaker 2 (05:38):
It isn't a case correct. Yes, So the advisors, certainly
in say Sydney Melbourne markets who look after wealth, are
not going near bitcoin. They may on request if you
say that's what I want to hold because I think
there's something in it. It's very speculative in the context
of traditional investment. You know, it's not not bricks and water.
Speaker 1 (06:00):
There exceptions in the family officer, high networth.
Speaker 2 (06:03):
No, only in terms of attitude, which is what it
comes down to you, doesn't it. So if you're a
betting person, if you're if you've got horses, for example,
bitcoin might be just adjacent to the racetrack.
Speaker 1 (06:15):
That is. That's the skeptical view. Really, yeah, but I'm
just looking at a little bit, just taking it a
little bit more central and economic and saying, well if Amazon,
Walmart and JP Morgan in the last couple of weeks
have announced their plans to issue their version of stable coins,
(06:36):
which are convertible to dollars, right, So it hasn't got
that wildness to it, right, So it's pegged. And then
if they can find economies of scale or productivity gains
from that, then it is a different story, isn't it
to some expect And maybe bitcoin is just a proxy
for all this activity. But even if it is, then
(06:58):
it's then it becomes a different piece. Truly.
Speaker 2 (07:01):
Yeah, it's still going to be very difficult. And I
made I guess I made that almost joke about horses
and horse racing. But at least with the horse racing,
you've got a horse. I'm still unclear with bitcoin what
you've really got and what does that mean to you
in terms of value compared to me. But again, whilst
the predictions are that it will rise, the question remains
(07:23):
what kind of treasury or monetary asset is it? And
the worst thing about it for US individuals, us mere
individual investors is if we lose the data, if we
lose the bitcoin, it's gone. It's not like we have
a deposit in the bank and there's a balance that
says you've got one hundred dollars, it's gone. You've basically
(07:44):
lost it. So if you lose if you store your
data off site somewhere your bitcoin and you lose the
password or you lose the device. Yep, if you lose that,
it's gone done. So there's some perhaps risks like that
with it that people may not be considering. And someone
like Buffett is obviously famously said he's never going near bitcoin,
(08:05):
and he continues to support that view and look at
you can't. Not everyone agrees with him, but that's a
particular point. And I think in the context of someone
like Trump, the federal reserves in a pretty tough spot.
I think we all know, and perhaps like most things
with Trump, it's a bit of distraction.
Speaker 1 (08:23):
Right you think it's a decoy from the broader issue
of US deaths, US dollars. We won't go there because
I want to take a short break. And what I
wanted to come back to is that the access to
bitcoin and crypto is changing so rapidly, and we can
go in now through ETFs and to some extent that's
commoditized collateralized. We don't have to worry really if someone
(08:46):
loses the key to their particular crypto holding. That's one thing.
And also when we just look at at the opportunities
across the board. We're seeing more and more people coming
in from all angles on this and we just want
to pick up on what is it? Is it gold,
is it correlated? Is it just another ascid that generally rises,
(09:06):
or is it non correlated? Which was the original proposal.
If you like that, you could take bitcoin and it
would serve you when traditional assets go awry. But I
wonder about that. Let's talk about that in the moment. Hello,
(09:28):
welcome back to The Australian's Money Puzzle podcast. James Kirby
here talking to Jackie Clark. Now, Jackie, let's just look
at the other part of this that. First of all,
you were talking about advisors don't like it, but advisors
love ETFs, and money has been pouring into crypto ETFs
and all the major ETF houses have crypto and this
gives everyone a sort of an easy way in. So
(09:51):
the advisor will say, look, I don't know anything about
bitcoin or those exchanges, but there is an ETF you
can use. And of course, in saying so, the ETF
takes all the boxes from a regulatory point of view.
So the advisors okay with that. The client says, well,
that's an easy way in, just like ETFs or an
easy way into everything. It's a commoditized liquid, conventional asset,
(10:14):
which is actually packaging and nonconventional asset. But it has changed,
hasn't it. It's taken the bitcoin and crypto play from
the margins into the very center, which brings us back
to what we said at the start of the show.
A billion dollar in SMSs, a billion dollars in crypto
in SMSFS now and key funds like AMP a sort
(10:37):
of an icon for all its feelings of major institutional
money in Australia. So does that change things?
Speaker 2 (10:47):
Well, it doesn't change it for me. But perhaps if
there was an asset class that you didn't represent, and
perhaps that's the question that these organizations have asked themselves,
which is this an asset class that we should hold?
And there's no doubt a lot of demand for it,
and in terms of perhaps the nature of assets going forward,
this could be representative of more of the types of
(11:08):
assets we might have access to in the future.
Speaker 1 (11:11):
What are you thinking there? What are you think of that?
Speaker 2 (11:14):
Just the context for me is really about information and
how powerful access to information or data is, and it
always has been getting access to data information, so perhaps
there's something more in the marketability of that down the track.
And so this is also something that's a little bit mysterious,
is it not. And given it's had such a good
(11:35):
track record, I think that it will demonstrate appeal to
people because of the quick gain. I guess, you know,
I'm saying, I guess because it's difficult for me to
get on board with it because I'm having trouble. Maybe
I'm materialistic and I'd like to see something from my
money other than again exactly. So yeah, still is it's
(11:58):
not regulated, right, so it still is pretty rough.
Speaker 1 (12:01):
It's increasingly regulated, though, particularly in the world's most important
money market, which is the US. And there's two things
I'm thinking of. One is that it seemed to me
for a long time there was two types and I'm
going to generalize here dangerously. I'm sure that there was
two types of investor that were very interested in crypto
and bitcoin. There were people who actually didn't engage in
(12:26):
conventional markets anyway, and they saw this as a new thing,
basically a new thing that they could get an edge
in this, and they didn't actually have shares properly, but
they had bitcoin, and there was often this market were
much younger. They were online Sammy et cetera, et cetera.
But then there was another market which were very sophisticated investors,
(12:47):
the very top of the tree, and they wanted to
know everything about it. And they see it, they see
looting to use single names. But there are prominent investors
in our own market. There's very many problems to best
result this indus. Mark Carnegie obviously been standing I suppose
an earlier and people will say, well, look, Mark Carnegie
has got right so many times, he must know something
(13:10):
I don't know. So so I think this, first of all,
there's that dichotomy between who who is prepared to back
it and get involved and learn it. But what I
want to ask you is whether this idea of the
general idea that it's an alternative and so that it's
so you mentioned that the very stars the idea of
digital gold. How do you view that proposal.
Speaker 2 (13:32):
Yeah, I mean I think there's it's got some lenks
to it in the context of it being this online asset. Yeah,
and look, maybe if you're proactive with it, I mean,
it's recognized as a currency that you can trade for things.
And perhaps if you were able to do that, and
that could be used in your own business model somehow
(13:54):
that might also have some additional value to you. But
again I think it requires then to understand that market
really well and recognize where you can trade the bigcoin
and what for? And does that is that all value
to you? Because quite? I mean if you can have
a product or an asset that growsing value quickly and
you can offload it quickly for something else, then I
(14:16):
see some benefit in that, which perhaps is where someone
like Mark can tubby.
Speaker 1 (14:21):
Do you see it as a correlated asset? And folks,
I'm sure just to make that clear, what we're saying
is the jury is still out. It seems above bitcoin.
I mean, it's established now, it's an acid class. I
don't think it's going to go. I think we assume
that it's got for our lifetime. It's going to be here.
It's been severely tested in many ways. It survived all
those tests. So let's take that on put that on
(14:42):
the table. But then the issue is whether it's digital goal.
And if it is, that would mean that basically, if
markets crumbled, if currencies in the US dollar classic case,
that the US dollar in ten years time is a
sad reflection of what it is was ten years ago
to say or and in that context, then the proposal
(15:06):
is that bitcom will stand alone, basically that it will
be like gold, it will be they will win. That's one.
That's the non correlated asset argument. And then the outariasive
argument is it's just becoming. It's just another asset. And
if the markets are good, it's good. The markets are bad,
it's bad. We haven't got a sufficient track record have
(15:26):
we really to test that? So it's simply live debate.
Where are you on that one, Jackie?
Speaker 2 (15:34):
I guess only a bit what's been fifteen years, It's
been around four now, so there's not a lot of
evidence that it's very short periods.
Speaker 1 (15:42):
But it's part sufficient volume and interest to we even
stand as some sort of proxy with gold.
Speaker 2 (15:50):
Yeah, and look, I find it fascinating with the market
to how some things don't always hold value like they should,
even when they've got brilliant balance sheets. It's just that
can humor sentiment where people are at and it might
be the same with bitcoin. But there's still I guess
a lot of growth potential in bitcoin. And if in
fifteen years we're at under twenty percent takeup of what's
(16:13):
available there. It's got a long way to go from
growth potential in terms of accessibility, and so perhaps it
will become more normal and I think, as you say,
with the likes of amp, Walmart and Superinneation, fun State
starting to pick it up or recognize it as an asset,
that maybe helps normalize the mystery a little bit.
Speaker 1 (16:33):
But I'm not.
Speaker 2 (16:34):
Any clearer that the mystery has shifted, and so does
it move with the markets. I don't know. There's a
whole lot of evidence that it has at the moment.
Speaker 1 (16:45):
There's a lot of you're seeing there's lack of evidence
that it's correlated. Correct, So you're suggesting this non correlated
well implication.
Speaker 2 (16:54):
It's yes, that's how I would see it.
Speaker 1 (16:56):
Okay, that's interesting, right, Okay, So since we're talking about
that and the markets, it seems to me obviously here
we are at the end of just to switch gears
for a moment and bring us back into a conventional,
traditional space where we are more sure. Yes, well, value,
(17:17):
that's what you're looking for, isn't this. You don't like
the fact that there's no intrinsic value there isn't it
really for me?
Speaker 2 (17:23):
That's right? Yeah, absolutely, yeah. It's very hard to be
a nausey and say any other way.
Speaker 1 (17:30):
Actually, well gold, I mean, what's the intrinsic value of gold?
Speaker 2 (17:34):
Yeah, well, I mean that's a genuine mineral, isn't it gold?
Speaker 1 (17:38):
Okay, but it gets it gets a down high price
for a genuine mineral.
Speaker 2 (17:42):
Doesn't Yes, yeah it does. It's done really well. But
I probably won't be going there either.
Speaker 1 (17:48):
Okay, very good. So just on the market. It's what
I have you because you have a finger of so
many pies, fingers, so many pies. I'd like to just
see where you're coming from in that. Our market here
we are right coming to the end of the financial year,
shares a up eleven percent, the average balanced super funders
out thereat point five percent. How on earth this wasn't
(18:10):
supposed to happen with the market? Is our market is
now a point where the most positive forecast at the
start of the year said it might reach by December.
What's your view on the share markets?
Speaker 2 (18:25):
Yeah, it's a good time. It's a really good time
to have this conversation. It's there's a broadly positive view
of the market now we are in an unusual spot.
The tariffs aren't settled and our bow needs to get
his meeting.
Speaker 1 (18:39):
At some point.
Speaker 2 (18:41):
But perhaps we're a little fish in a big.
Speaker 1 (18:43):
Sea enough priority.
Speaker 2 (18:45):
Yes, so there's definitely some positives that we have and
perhaps the Reserve Bank has certainly now got some genuine
sort of firepower. The RBA is in a good spot,
and I think with the disruption, if you like, between
the US and China, Australia generally will benefit from that
tariff war, if you like, because people will start will
(19:07):
be the beneficiary of that.
Speaker 1 (19:09):
Tell us a bit bit more as to how.
Speaker 2 (19:11):
Just in terms of the way trade will work, we
will be saying as probably easy pickings as a partner
in that respect. Yeah, and perhaps, like I say, it's
a bit of a distraction, we're a bit easier to
deal with in the context of those tariffs, so we
simply should benefit and that would come down to what
items we're trading with each party. But I think we
(19:31):
benefit from that, right, Yeah.
Speaker 1 (19:34):
Do you think that to some extent that depends the
buoyancy in the ESX.
Speaker 2 (19:38):
I think that's definitely out there. But perhaps the other
option is that if money leaves the US, it might come,
it might find its way here. Now there's two reasons
why you invest in Australia. We have a fairly narrow band,
which is really banking and resources. But that's a good
reason perhaps to have your money leaves, for example, the
(20:02):
US and come to Australia. So that could be an
upside benefit of.
Speaker 1 (20:05):
With the US institutions are buying come bank at a
one hundred eighty.
Speaker 2 (20:10):
Dollars would be one of the reasons. Yeah, So that's
something that I think would be appealing for people to
come to Australia. But typically when I think about sort
of revenue sources, most Aussie companies have a lot of
domestic revenue as well less overseas revenue. So perhaps we're isolated.
(20:30):
So we have it's so like the pros and the
cons of being isolated this.
Speaker 1 (20:34):
Time or this sort of til it's.
Speaker 2 (20:36):
Almost independence in its own way.
Speaker 1 (20:39):
The banks are domestic, aren't there.
Speaker 2 (20:41):
They are.
Speaker 1 (20:43):
Domestic focus.
Speaker 2 (20:44):
Yeah, So if you were looking that's right and narrow
your investment focused or isolate impact of particular things such
as US China tariff arrangements, then that's something you can
do through an Australian asset so, so there could be
some upside from that for Australia. But we're in a
pretty good spot right now with the RBA, and I
believe that the China and the US wherever that conversation goes,
(21:08):
I'm sure it's going somewhere that neither you know, China
won't be happy with. Then they'll respond accordingly, but might
have a slightly deflationary impact as well, which again is
good for US. So I think that strengthens the RBA's
position as well. So yeah, so, I mean it's all
it seems generally good, and that's in the absence of
anything more serious happening on the world front.
Speaker 1 (21:31):
I know it's a tough question, but it doesn't five
founded or so markets up eleven percent over twelve months,
it's up four percent for the year, and we get
four and a half. It's up four and a half
for six months. I should say, you know for the year.
The calendar of today's checking your four percent evidence, les's
three eight percent already. If you stopped right now, selling
(21:53):
mayn't go away. I know it's tuning, but do you
think this is as good as it gets? Is the
room for for are?
Speaker 2 (22:01):
You know there's no crystal ball that can respond right now.
There's too many sort of geopolitical matters occurring that could
have any number of impacts. So it's just very hard
I think for anybody like it always is.
Speaker 1 (22:15):
Really it sounds like you're not you're certainly not saying
this market is this market's want too fast or anything
like that.
Speaker 2 (22:22):
No, No, because there's evidence that there's wind in it
or puff in it, wan, a bit of puff in it.
Speaker 1 (22:28):
Actually the wind is behind it. Perhaps, is that perhaps
where we're coming from as.
Speaker 2 (22:35):
Opposed to we will it's not a wet sile put
it that way.
Speaker 1 (22:42):
Okay, very interesting. I've got really good questions this week, folks.
I've selected some absolute corkers, I think, and I want
to have Jackie on board when I'm dealing with them,
and we will be back in the board. Hello, Welcome
back to The Australian's Money Pustle podcast, James Kirky with
(23:03):
Jackie Clark. Who is, may I say, a chartered accountant,
she's a tax advisor. She's a member of the Institute
of Company Director, she's an author. She's a board member
on some very interesting private family office boets. Hence the
sophisticated view on the market. Okay, quickly, Ryan, who actually, Ryan,
(23:26):
We're not dealing in any great detail with your question,
but you actually kicked off the whole concept of today's
show about bitcoin. Ryan had originally asked he had basically
met the point that the price some of the crypto
related investments were going so well. He told that he
couldn't believe that the money puzzle hadn't covered it yet.
(23:47):
So hopefully we've met a start Ryan, on that of
what I would call the post Trump crypto reality, which
is quite different I think than the pre Trump crypto scene. Okay,
and asks your article in the Australian, which was by
the way, the seventh of June says industry funds pulled money,
but all investors taxed in the same way. This was
(24:09):
my piece where I was just saying that the nature
of industry funds and how they are, how it all works,
is that the tax is polled. Consequently, folks on the
new supertax, that polling of requirements, tax requirements. I mean,
(24:30):
some people are going to be better off in big
industry funds simply the older ones with lots of money
will in some way cross subsidized the younger ones who
are in the same fund. This is a particular issue
for funds where there is a lot of older, wealthier members,
and we actually had a list of the top ten
(24:52):
funds with the most exposure. My broader point on all
that is that no one escapes this fund. No one
escapes this tax Division two ninety six because it's a
new At face value, it's a simple fifteen percent tax
that's a new one on top of the original taxes
and super it only affects people with more than three million. However,
(25:14):
in reality it's going to infect a help a lot
more people than that because it's on realized games, which
is just completely daft I think as a way to
tax people as personally and Treasure shows no sign of
changing on that, and more importantly, is not prepared to
index it, and that means a lot of people are
(25:35):
going to get caught in it very quickly as the
years go by and people say, oh, you are scare mongering.
These always get indexed, No, they don't. The sophisticated investor,
for instance, requirements are unchanged for twenty years. Division two
ninety three tax, which is another super tax on high
salary earners is unchanged. I think it's for twelve years.
(25:58):
There's no rules about this. I just wanted to that
also stem there jacking. Is there anything else anything you
want to add to that?
Speaker 2 (26:05):
No, probably just to answer question. I know that just
in terms of calculating it and understanding how to work
through it yourself, to get your head around it and
how members in big funds might be impacted. The Association
of Superannuation Funds of Australia has given quite a bit
of guidance on the impact of Section two ninety six
and I've had look at the different calculations they're provided.
(26:26):
They're quite helpful instead of explaining this, but I think
you hit the nail on the head with your article actually,
you know, indicating how assets are pulled for the benefit
of all members. But actually even the administration of this,
all the costs of this will actually fall on the
weight of all members of super funds to some extent
to the end of the day additional compliance any organization has,
(26:48):
somebody has to pay for that.
Speaker 1 (26:50):
So when i's to be for it exactly, and I
think you know, I hope you know you know. And
one of the things you did mention was that you
know is had nothing to do with with two net
six most but in fact it permeates it. It does
perculate right through the system. I hope I've met that
clear and as sincerely mean it.
Speaker 2 (27:09):
That's the other thing just add to that giant is
I think I've determined what something like half a million
salaried employers around Australia are actually impacted by.
Speaker 1 (27:17):
The super immediately.
Speaker 2 (27:19):
It's quite substantial. Yeah, immediately, and I will baying big
fans I were all being self managed fans by a
long shot.
Speaker 1 (27:25):
Yeah, but this is a key point I was making
that it was aimed at self managed superinvestors without a doubt.
But it is the nature of it, this construction of
onrealized gains and then the nature of how big super
funds work mean they are pulled into it. They are
complaining much, but I better complaining behind the scenes. Okay, Andrew.
(27:47):
Interesting question from Andrew. Great question Andrew. He says it
would be good to talk about the virgin IPO later
this month and so detail and to compare it with
other recent large years, and to discuss the impact on Quantus,
which has touched eleven dollars and it's paying dividends for
the first time in years. Okay, Marvel's question so interesting
(28:08):
the virgin ipo. This is what I think about the
virgin ipeo in three numbers. It's listed at two fifty
the first time, and when it was taken off the
boards it was nine cents. It's coming back at two
ninety three after that. It's a question of this. I
have no idea what you think of it watching.
Speaker 2 (28:27):
My Headshine, which the listeners, well, well, I think the
first thing pats for Andrew is I don't think it
was a retailer. For it all only to holdstyle investors.
So it's it's all being taken up for starters.
Speaker 1 (28:41):
It's a tiny it's a tiny amount, which is right.
I won't say a trick, but the mathematics of when
you float a tiny amount of stock, it's not to
waye about it. The price gets supported easier, let's be
yea yeah.
Speaker 2 (28:53):
So Baying came in with evaluation two dollars ninety and
morning Star came in with evaluation at two dollars sixty.
So perhaps that's an indication of where things might head.
But you know, the question is it is a they've
taken advantage perhaps at the time, so it is relatively buoyant.
If you look at the trends coming out of the
COVID era and you look at all the statistics on
(29:15):
Australian travelers, there's definitely been a rise. I think we've
pretty much met, if not exceeded, there's sort of pre
pandemic times of travel. So it is the right time,
is it opportunistic? So have they taken advantage of that?
I'd be interested to see, mind you, if the implications
of Israel, Iran, Ukraine and so on may start to
(29:37):
have the reverse impact on the airline world as well
all people, perhaps because I'm feeling less inclined to travel
as a result of what's going on, because it's pretty
hard to avoid the Middle East when you fly out
of Australia. Yes, exactly.
Speaker 1 (29:51):
They have to go around to Ukraine. They have to.
Speaker 2 (29:53):
Yeah, so look, and that may be a small thing
in the scheme of just having to get around the world.
We've all got family to visit, paper all things.
Speaker 1 (30:01):
Happen, I mean, yeah, I mean more pointedly, the history
of the Second Airline in Australia is woeful. And I'm
sure these are great people. I'm sure they've got it
in a great shape. I don't doubt for a moment
they've optimized their moment and their numbers for the float
goes without saying, here's the thing. Answer collapsed, Virgin Mark
one collapsed. Brokers not brokers. To be fair, researchers Morning
(30:23):
Star are already saying this, this float is too high.
Speaker 2 (30:26):
Yeah. I would agree with that, and we've got to
meet a bit careful. Yeah, well I can't. Sorry, I
can't see how you can because it may may have
been at its peak.
Speaker 1 (30:37):
Okay, very good, we will leave it right there, Andrew,
I think the answer is very clear. None of this
is investment advice ever. It's information only, and I'm sure
you all know that. Okay, final question, fam Sam, as
I said in really good questions today, I was hoping
you can explain to me how I can deal with
the suspended trading stock in my portfolio.
Speaker 2 (30:59):
It's actually a great question to have. If he mentioned this.
Speaker 1 (31:02):
One, there's no point actually naming it because there's plenty
of them out there. There's a whole part of zombie stocks.
And he says it's been suspended for years. My money,
you're stuck in this. I can't sell it. What are
my options.
Speaker 2 (31:12):
This is really frustrating if you've ever been this position
with suspended training stock, because you can't take crystallize the
capital loss from a tax perspective until it's actually liquidated.
And so there is a small little opportunity. There's a
these be a company which I think still exists called
the listed dot com dot au. You can go on
(31:33):
to that website and see getting up to date read
on what's happening with the company. You might be able
to take that information to your accountant to determine whether
it's realistic that you can actually take that crystalize. You
can crystallize that capital loss from a tax perspective, so
that might be the thing to do. Obviously you need
to continually review it. But it's very frustrating. It does
(31:54):
happen often.
Speaker 1 (31:56):
How does it work. Does it run to zero obesity
or a zero point one center or something?
Speaker 2 (32:01):
Oh sorry, when they're suspended your main yeah?
Speaker 1 (32:03):
Or is it valued at the amount that was suspended.
Speaker 2 (32:07):
That's a good question. I wouldn't know that. I'd have
to look at each individual case actually to work that out,
and you can obviously the conservative approach is whatever they
close that you could take a loss to that level
and then do a subsequent loss, you know, take a
reasonably arguable position, which is what the Australian tax officers
would be looking for in the situation. But technically, until
it's actually in liquidation or formally wound up, you actually
(32:30):
can't do anything. It's very annoying so here, but you
could at least do some research.
Speaker 1 (32:36):
You have value and possibly possible in there, especially if
it was the nineteenth of June and you had two
weeks to go try and find so and I hear
that the markets up eleven percent.
Speaker 2 (32:49):
People may be doing to find.
Speaker 1 (32:50):
As usual one maybe, yeah, especially with our market. Yes, yeah, yeah,
Well it's a good time so we're able to say
that terrific. Hey, look, thank you very much, Jackie. Great
have you on the show again.
Speaker 2 (33:01):
Good to be here, James, thank you.
Speaker 1 (33:02):
And the book Stop worrying about money, which you somehow
manage time to rise on top of everything else. You've
won a couple of awards for it, a.
Speaker 2 (33:11):
Few international awards. It's been incredible. Actually. The last one
was the Money Awareness and Inclusion Award Program, which is
a global awards program, so forty five countries participating. They
announced it out of Singapore about a month ago, which
is wonderful.
Speaker 1 (33:26):
Are you shipping vast quantities out around the world now?
Speaker 2 (33:30):
Of course maybe Amazon is, I'm not.
Speaker 1 (33:36):
It is the royalty checks from financial books. We've had
some fun with those on the show before. Let's see
that you couldn't live on. Not worth the conversation, barely
relevant in your tax returns. All right, very good. Thanks
for a lot, Jackie Clark. Great to have you on
the show. We're talking again soon. Thanks James, and thank
you everybody. And great question today. Keep them rolling the
(33:57):
money puzzle at the Australian dot com dot a talk
to yourself Sam the Room sub
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