Here’s what you need to know today

• Anthony Albanese’s first address to the United Nations has seen the Australian Prime Minister make the case that “moderate, progressive middle powers” like Australia have a roll to band together and maintain world order. (AFR)
  
  

• Anthony Albanese was also touting Australia’s world-first social media ban for children under 16. Speaking alongside Albanese, the European Commission President Ursula von der Leyen said she would look into implementing something similar in Europe. (Capital Brief)
  
  

• The Australian government has released its draft digital assets legislation, intended to give certainty to Australia’s crypto industry. It has proposed defining crypto exchanges and token custody providers as financial products, meaning they would require Australian Financial Services Licences to operate in Australia. (Capital Brief)
  
  

• Macquarie has agreed to pay $321 million to Super fund members who were invested in the collapsed Shield Master Fund through its wrap platform. This will see 3,000 investors get their full investment returned. (Capital Brief)
  
  

• The copper price neared an all-time high after a devastating mudslide saw two workers die at the world’s second largest copper mine in Indonesia. Australia’s copper miners were up, with BHP and Rio Tinto both up 4%, while Sandfire Resources was up 8% and Capstone Copper up 11%. (Reuters)
  
  

• China has proposed cutting emissions 7-10% from 2020 levels by 2035. China remains the world’s largest polluter, but an accelerating renewable energy rollout has broken records each of the past two years. (BBC)
  
  

• Giant, the world’s largest bicycle manufacturer, was accused of using forced labour by America’s customs agency. The Taiwanese firm has one factory in Taiwan and 5 in China, and is yet to respond to America’s claims. (NY Times)
  
  

• British bank HSBC claimed it achieved a “Sputnik moment” for quantum computing. It claimed a trial of a quantum processor built by IBM yielded a 34% improvement in calculating how likely it is a bond would trade at a given price. Given the way Russia’s Sputnik shocked the world, we’re not sure HSBC quite nailed the analogy. (Bloomberg)

What the…?

Emirates has revealed the airline’s most caviar-eating routes. And surprisingly, Australia makes the list.

The airline said it has seen a 30% year-on-year increase in caviar consumption across all routes, with the top 3 routes for the delicacy being: Dubai-London, Dubai-Paris and then Dubai-Sydney. (SMH)

Investing is a lifelong journey

Here’s what you can learn today

The power of online listing businesses

This is an excerpt from an episode of Equity Mates Investing with Nick Cregan, founder of Fairlight Asset Management. (Apple | Spotify | YouTube)

Question: So what are some of your observations about these real estate portals globally? What characteristics make them so attractive?

Nick: Yeah, that's a really good question. The first observation here is that in the developed world, we can only find two examples where the number one property portal has ever been supplanted by the number two. So the equivalent of Domain overtaking REA on traffic and inventory numbers and becoming the number one property portal.

The only two places where we've sort of seen that is in Russia, and I think we can put a swift line through Russia and the other spot is regional France, where there's a sort of horizontal marketplace that came in, but not in the major city.

So these are widely considered, and I think quite rightly considered, to be almost like the old newspaper classifieds model. The classified pages in a newspaper were effectively a regional monopoly. These businesses have really stripped out the property section of the newspaper. So that would be the first observation about the market generally, it's a very attractive one around the world.

Question: How do you explain the phenomenon that in many markets these businesses become duopolies [like REA and Domain in Australia] where one is far larger than the other. Is it just really strong network effects for the dominant platform?

Nick: Yeah, one hundred percent. You can think of the consumer behaviour here where for 99% of people, your house is going to be your most valuable asset. If you go down to your local real estate agent and say, look, I'm looking to sell my house. And he says to you, well, we're not going to use realestate.com. And you say, well, you are fired.

When selling your house you wouldn't use an agent who doesn't list on the main portal, as that's where all the buyers are. This creates a powerful virtual circle: more inventory attracts more eyeballs, which compounds over time. Nothing too revolutionary in that statement, but just a reminder of how powerful these network effects can be.

Want to watch our full conversation with Nick? Check it out on the Equity Mates YouTube channel (conversation with Nick starts at 14:34):

A message from Schroders

Want more Equity Mates?