Here’s what you need to know today

• Australia’s unemployment rate held steady at 4.1% in October. This is the third consecutive month the unemployment rate has held steady. The strong labour market is one of the reasons the bond market has pushed expectations for Australia’s first interest rate cut out until September next year. (ABC | AFR)
  
  

• The Australian government has held the first public hearings outside Canberra as part of the Inquiry into Nuclear Energy. 90 local residents gathered in Biloela, Queensland for the hearing hosted by the House Select Committee on Nuclear Energy. (ABC)
  
  

• Mineral Resources has announced it will cease operations at Bald Hill, its lithium mine in Western Australia. This decision comes as lithium prices continue falling and will mean 300 jobs need to be relocated or lost. (AFR)
  
  

• ASIC is taking Cbus Super to court, alleging the superannuation giant delayed paying death and disability benefits to over 10,000 members. Of those 10,000, ASIC claim that more than 60% have been delayed by more than a year. (ABC)
  
  

• America’s annual inflation rate ticked up slightly in October, from 2.4% in September to 2.6%. This was in-line with economists’ expectations and the Federal Reserve is still expected to cut interest rates again at its next monetary policy meeting in December. (CBS)
  
  

• Amazon has launched its competitive platform to Temu and Shein, called Amazon Haul. The platform will feature clothes, electronics and other products from as little as $2 or $3. Nothing on Haul will cost more than $20. Unlike regular Amazon products that can get delivered in days, these products will be shipped direct from manufacturers and will take weeks to arrive. (Quartz)
  
  

• Chinese biotechnology firms are starting to build a reputation for themselves. In the past year, 5 Chinese biotech firms have been bought by Western peers. The latest, German BioNTech is paying US$950 million for Biotheus, a Chinese firm with an innovative cancer treatment that is said to have the potential to rival Keytruda, the world’s best-selling cancer drug. (Financial Times)
  
  

• Sweden’s Buy Now Pay Later giant Klarna has filed for an IPO in US. In 2021, during the BNPL boom, Klarna reached a $46 billion valuation. It was last valued at $15 billion. (Financial Times)

What the…?

If you’ve ever been to a restaurant and thought you got dudded on the portion size, have you ever thought you may have just witnessed securities fraud? That is what a group of investors in Chipotle are arguing: suing the company for serving up small portion sizes.

The lawsuit claims investors were mislead about portion sizes, which led to higher costs and a fall in the share price of the Mexican chain. (CNN)

Investing is a lifelong journey

Here’s what you can learn today.

John Hempton: Some thoughts on Brambles

John Hempton, founder and CIO of Bronte Capital, is a famous Australian investor primarily known for short-selling companies he believes are frauds. In this write up, he shares his thesis on a company he is investing in on the long side at the moment: Brambles (ASX: BXB).

For anyone who has worked in logistics or large-format retail, you’ve likely interacted with Brambles. They are the owner of Chep pallets, and they are a staple of global supply chains.

We would argue, Chep has one of the best moats in the world, perhaps the strongest example of a real-world network effect. (Network effects are where the platform gets more valuable with each additional users e.g. Facebook or a phone network.) The fact that all logistics players have Chep accounts means pallets can be transferred from company to company, as pallets pass from warehouse to truck to store, making the whole network far more valuable for all participants (and far harder for a new pallet supplier to break in).

However, the problem with Brambles has been an execution problem. Since listing in 2001, the stock is up 97%. That works out to be a compound annual growth rate of 2.9%. But if Brambles management can turn it around, John explains, it could be a great Australian success story taking on the world.

Today’s sponsor is Australian Property Scout

Join Sammy Gordon, regular Equity Mates property expert, in the studio with co-host Jimmy Ibrahim, APS Portfolio Strategist Luke Teeuwen, and Senior Buyers Agent Jason Titus for a deep dive into rentvesting and its impact on building an investment property portfolio.

They break down what rentvesting is, why they use it, and the key factors to consider before buying a primary place of residence. From improving borrowing power to accelerating your portfolio, this episode covers it all.

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