This is what the flux.
I'm justin and I'm harsh Deep and it's Wednesday, the fifteenth of May.
HD. It is great to have you back on the pod. Looking forward to you dominating in the hot seat over the next couple of weeks.
So excited to be back. It's going to be a fun few weeks.
Now. It seems like me Maynia at the moment. Maybe back because the US gaming company game Stop has jumped over seventy four percent.
It's great to be back, and what a day to be back, especially after last night's budget. And while we'll be touching on it on the pod today, we'll have a deep dive on all the federal government's key initiatives in the.
FLUSAT three Educational stories today. HD, let's get into it for our first. The Labor government has dropped this year's federal budget with more than nine billion dollars in surplus. And this year the budget is all about cost of living.
Second successive surplus. It must be high fives all around Parliament House. What's the story here?
Does well? HD? Every year, the federal government delivers its budget, which tells us how much money government is collecting and where it's spending it and.
Most importantly, how it'll impact us in our daily lives.
Now. One of the big focuses in this year's budget was to address the cost of living but.
At the same time not give away too much money to drive inflation.
So as part of this budget there are some modified Stage three.
Tax cuts which will mean higher tax savings for low and middle income earners.
There's three billion dollars of hex debt relief coming from three million Australians.
Eleven billion dollars allocated towards building one point two million new homes by twenty thirty and.
The healthcare sector which will be getting eight and a half billion dollars over the next four years.
But Jazz, despite this spending, the government's budget is in surplus of nine point three billion dollars.
RICHI what is the key learning here?
A budget surplus may be good news, but it doesn't paint a full financial picture.
You see, when a government delivers its budgets, one of the biggest things it needs to consider is how the budget will impact government debt.
At the moment, Jazz Australia has close to one trillion dollars in government debt, a lot of which was racked up during the pandemic.
That debt could buy about twenty thousand. Now.
While that sounds like a gigantic number, Australia's debt levels are pretty stable compared to other countries.
In fact, Australia's debt levels are sitting below fifty percent of out GDP.
Compare that to the US, which is almost thirty four trillion US dollars in debt, which is around one hundred and twenty one percent of their GDP.
All about Japan, which has a whopping two hundred and fifty five percent of their GDP in national debt.
But even though Australia's debt levels are stable, they're not cheap.
This the government currently spends sixty million bucks a day on the interest repayments on its debt.
In fact, interest repayments are among the top five things the government spends.
On, and that's money they can't go to other initiatives like healthcare or infrastructure.
And while the budget isn't so plus this year, it's expected to be in deficit next year and beyond.
Which likely means even more debt and more interest repayments in the future.
For our second story, open AI has released the most advanced version yet of its chatbot, chat GPT that can see here and talk look like a real person.
Starting to feel like we're properly in the movie Heir HD. It's kind of creepy, so tell me more so, Jazz.
We know. Open Ai first launched chatjubt publicly in November twenty twenty three.
It's fair to say the world has not been the same ever since.
You want to make a recipe with only the remaining ingredients in your fridge, asks chatty g.
You want to give feedback to your friend without making it sound too harsh yep, CHATJBT.
Since then, it released chatjubt four, and now it's launched the latest iteration called chatjebt four.
Oh, the O stands for omni. In other words, chat jiput can now hold conversations across different formats of texts, of audio, and video in the same conversation, and it will literally respond in milliseconds.
Wow, that makes Siri look like she's stuck in the stone age.
Interesting to say that, HG. Because Apple is actually in talks with open Ai about rolling out chat jipt as a replacement for the untrusty old SII.
So I'm wondering, Jazz, what is the key learning move Ever hardware.
The phones of the future will appeal to customers based on their software.
We know that each year, Apple, Samsung, Google roll out new phones.
And each year they are for slightly better cameras or slightly more powerful computer.
Chips, and maybe they're a bit thinner if you're.
Lucky, but HG. These mini upgrades have left many consumers with little incentive to actually upgrade.
In fact, smartphone sales contracted for twenty seven months in a row until late twenty twenty three.
And now the most exciting upgrades aren't happening in the physical space, They're happening with the software.
Now, Samsung has already bought Google's Gemini into its newest devices.
Google's obviously also got Gemini in its new smartphones as well, which leaves Apple who first launched Serea in twenty eleven and hasn't changed much since.
So it's only a matter of time before Siri gets rebranded or fully replaced.
For our third and final story, Crocs has stomped on their quarterly growth expectations after selling thirty two million ugly shoes in just three months.
You'd think the ugly shoe craze would die down, but not for the big sea tell me more.
Okay, So CrOx is the footwear equivalent of a mullet, not particularly attractive, but extremely populars that's.
The comfort element which has seen it regrow its cult following, especially since the pandemic.
Yeah, CrOx was down and out until it started investing in collabse, which turned its fate around.
And now Jazz. CROs has beat its quarterly growth expectations with its sales jumping fifteen percent. But Jazz, there is one part of the business that is dragging its feet.
Big timet me through it.
Crocs acquired another brand called Hey Dude for two point five billion USD in twenty twenty two, and.
I'm going to put it out there as she I reckon they're uglier than Crocs themselves.
And it seems like people agree with you, because Hey Dude's sales fell seventeen percent last quarter and.
CROs is expecting Hey Dude's revenue to decline a further ten percent this year.
So it seems like not all ugly comfy shoes can perform the same way as Crocs.
And this diversification strategy hasn't quite worked out to plan.
So tell me Jazz, what's the key learning.
Diversification is a common strategy for companies looking to expand their market presence and reduce dependency on a single product line.
CROs knows all too well what can happen when your on trend brand isn't popular anymore.
They suffered the fate in twenty sixteen before rising from the ashes.
Which is part of the reason why Crocs acquired Hey Dude.
It was a move to diversify their brand portfolio.
But diversification comes with risk.
Yeah. Well, functional footwear like Hey Dude was booming during the pandemic. Not all of these brands have continued to see success.
Yep. Think about All Birds, another comfy shoe that was less ugly, which has seen its market cap drop from four billion USD to just one hundred million USD.
So now it's g Crocs will have to work extra hard to bring Haydude back to its former glory. Flux s'am, if you want to know about the federal budget that you can't be bothered reading all about it through the newspapers. We have you covered in the Flux app. HD's delivered a whole range of under sixty second videos on everything in the budget and how it might impact you. Make sure to download the Flux app and check it all out.
Thanks for listening, and we'll see you on Friday.