Chris Brycki
speaker
759 appearances
3 recordings
2 series
first heard Mar 2022
last heard 30 Jul
Chris Brycki’s voice in public audio — every appearance, attributed to the second.
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recordings per month · last 12 monthsRecordings per month over the last 12 months — 2 in all, peaking in Jul 2026 with 1.
Appearances
And it's one of the big problems with this structure that apparently was known as well back in pre-1999, but hasn't been addressed by the treasurer in this new proposal.
Well, it was already hard enough to be successful at it, but I mean, this just adds another barrier.
And one of my concerns that I've raised as well is it will cause a hollowing out of our share market because any industry where you're thinking there might be a few losers is no longer worth investing into.
So, you know, mining, biotech, you know, a lot of emerging industries.
And dividends are getting preferenced a lot more under this new structure because you still get the franking credits back.
So what is going to lead to is a lot of companies and boards upping their dividend payout ratios because that's what investors are going to demand because it's better from a tax perspective.
Investing less into R&D and innovation and into expanding their businesses and adding jobs.
And all of those industries that are doing innovation won't get supported financially because investors will be running towards the dividend payers like Telstra and Woolworths instead.
Well, yeah, it's a sad irony of all of this is we've created a tax structure that massively disincentivizes people to take productive risks, to back ideas, and really just encourages people to, you know, put money into those old incumbent businesses that have been around for 50 years.
And, you know, it's why I wrote that piece as well in The Australian around the idea of the Japanification of Australia, that really it's going to introduce a lot of the problems that caused, you know, the lost decades in Japan.
We have to buy it?
It's one of the interesting challenges when a float's so big is that sort of passive buying that has to happen.
And I think I mentioned earlier, it's about $14 billion that's been calculated.
Interestingly, the S&P 500 rejected adding it earlier.
If they had said yes as well, it would have been more like $25 billion worth of passive buying.
So really then it's about finding the right level.
Where are the sellers going to be shaken out to be happy to sell to these index buyers?
And it's not only index buyers, it's going to be active managers that don't want to diverge from the index.
It is one of the reasons why some of these rules were embedded into the indices originally to give it time and let things settle down first.
So it's going to be an interesting case study, I think, that we'll look back in the future on if you force all indices to buy a new entrant immediately, what does it do?
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