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Hello there, I'm Ticky Fullerton, every night bringing you a full hour of the very best in business coverage across the nation and internationally, especially where business and politics meet. Coming up - The British buyers of Arrium tour the Whyalla steel works - talking up the site's potential. Our interview with the Chief Investment Officer of GFG Alliance, Jay Hambro, ahead. The Aussie dollar hits two year highs - so will it cause trouble for the RBA and fund managers? We'll bring you analysis with Forager Funds. And Bellamy's says earnings are improving in the wake of its latest China woes. We'll take you to Beijing, for what's behind the broader crackdown. Here at home, Liberal President Nick Greiner reckons the divided party risks defeat at the next election. In the US, Wall Street's most famous banker, JP Morgan's Jamie Dimon says: "it's almost embarrassing being an American citizen and listening to the stupid sort we have to deal with in this country". But based on my last fortnight in Britain, Australia and Trumpland are sitting pretty when set against the political and policy chaos in which the Old Dart finds itself. Winter is coming. The British media has Theresa May pegged as a lame, if not dead duck after her disastrous election. And the ensuing mayhem in British politics has brought out every opportunist to make sure a great Brexit for Britian is Mission Impossible. Let's start with Labour leader Jeremy Corbyn, who is calling for Theresa May to stand down. A man who campaigned for Brexit, whose socialist mission promises free education and massive health spending, the darling of the Glastonbury festival, and particularly of young Brits saddled with uni debts. Sadly, equality Corbyn style is simply intergenerational theft from Glastonbury-goers in 2050. It was left to Jeremy Clarkson of Top Gear notoriety to call out in the Times that two elections on the trot had been messed up by Britain's young people who needed their bottoms smacked. "They couldn't be bothered to vote in the European Union referendum and we ended up with Brexit," he said. "And then, having realised the error of their ways, they decided they would vote for that ours Jeremy Corbyn in the general election, so now we've ended up with a hung parliament which won't be able to deal with the mess their bone-idleness created in the first place." Touche. Over in Europe, EU president Jean-Claude Junker wants to make Britain pay, literally, with a divorce bill - the numbers quoted have been up to £85 billion. Yet at a time when Britain should be united in getting the best deal, its negotiating power is being white-anted from within. On Friday, the May Government released its much anticipated Great Repeal Bill, the plan for how Britain would ditch EU laws and transition to its own system, to cries of an executive power grab from Westminster by everyone from both the Scottish Nats and the Welsh. Labor and a fair smattering of Tories are naysayers. And the negativity among journalists I spoke with was quite overwhelming: in short, re-regulation in Britain will be too costly, too complicated, impossible. And what about the grassroots, ordinary folk? Austerity is now anathema to most Brits. The word itself has a terrible stigma to it. Brits have been living with austerity for seven years and they are sick of it. And while we in Australia looked on appalled at the terrorist attacks on London Bridge and the Borough Markets, the catalyst for national fury has been not terror, but the horror of the Grenfell Towers fire. The scandal around the building casing makes our pink batts look like a minor misdemeanour, but the burnt-out shell in the otherwise well-heeled borough of Kensington is an open sore on social inequality, and again political opportunism has already undermined even the inquiry into the fire. Malcolm Turnbull flew back from Britain to carping over his Menzies speech. Would he swap places with his old Oxford contemporary Theresa May right now? The British businessman whose company has bought the Whyalla steelworks factory in South Australia has said "the sky's the limit" when it comes to the site's potential. Sanjeev Gupta hopes to expand the Arrium factory - to feed his other global operations and to generate power. For more And for more on GFG's plans for Arrium - I spoke with Chief Investment Officer Jay Hambro, who was at the Whyalla site. thank you for joining us, great news for workers at Arrium, what did you think you could turn the business around?Arrium is a very fortunate suite of businesses, you have an iron ore mine and integrated steelworks here in Whyalla. Normally the beautiful city of Whyalla, is raining right now. But Whyalla is fortunate, we have this integration, Australia as a country has iron ore and coal and steel works. And we are very keen to make the most of that vertical integration. And really try and capture the extra margin that you can do to making this deal. Most parts of the world they are mining iron ore, mining coal, sending it to somewhere like China, and then bring the steel back. I think we can make a great sense of the operation here by doing it all on the one site.It is well known that for some workers in the past, GFG has put them on say half pay to keep the business going, what are the prospects of the employees at Arrium?I think where we are today is a huge credit to the workforce here at Whyalla, and a huge credit to the broader family within Arrium. And it does take a huge amount of work to make a businesslike this harm, and where -- a business like this work, and we are fortunate as the new steward is for this business. We have been very fortunate in lot of the businesses we have acquired around the world in buying businesses that have great assets and those assets come from the actual industrial sites as well as the human resources, people talk about us as a business that focuses on distressed assets, the reality is we bought distressed businesses with fantastic assets. And we have made those work by working very hard ourselves, but benefiting from the hard work of people.I understand you are -- your short to medium-term plans see you investing over $1 billion here, just to confirm, that is likely to keep jobs secure? Sanjeev Gupta, the principal of our business, has been operating this suite of assets and businesses to 25 years. He prides himself on his ability to have that continuity, he has not sold any businesses, he has tried very hard to not make anyone redundant and we have a fantastic track record on upfront. I think the prospects for people in way are very strong.-- in Whyalla. The purchase was secured after negotiations stalled with the preferred bidder, the South Korean consortium, what was your understanding of why they pulled out?Technically they're not pull out, I think we put in a better offer, that was a better offer because we insured value for the creditors and we ensure that our offer was a firm offer, it wasn't conditional on any government support, we are working very actively with government and they have offered a significant amount of support to, but it was not conditional on that support.And you think you have approval from the foreign investment review board, do you think?We are in a very good place. I don't think the review board has come through, but I have heard some very positive reports so far, so I am thinking my -- keeping my fingers crossed, and Arthur Sinodinos was here this morning, and he spake very positively.What you said to be sceptics who said that a business that could not survive on it own Premat you can make a sustainable and viable in the long-term?To answer your question about EHB getting rid of it, we bought a lot of businesses from major groups, -- EHB. We bought a lot of businesses and we made this work. -- BHP. We focused on people and niche parts of the business, try to add value, in terms of the suggestion that this was a business that couldn't survive on its own, I think that comes back to my previous point, the assets are strong, the people are strong, what was wrong was the structure of the balance sheet. The previous management, one might argue, put too much debt on the balance sheet, and the assets could not service that debt. So that it fell into difficulty. But it was not to do with the natural overall profitability of the underlying assets themselves. Because the assets are great.So whether you see the asset -- widdies in a major market the product?We are fortunate to have a global of steel producers, and steal users, so we are, for example, in the UK, the largest steel producer. We are also one of the largest customers Baron steel. And that allows us to move steel around the world. -- arrow and steel. We just watch the flood coming out today, we can to one of other sites -- our own steel. At the moment the business only focuses on the Australian market, we would like to build an export market the product from Whyalla. And I think that would place this business, if we can get it to be done competitively, in a strong place. There was talk previously of Arrium supplying some infrastructure for the aDANI project up north, do you see that happening, if it goes to plan? -- Adani.It is difficult to meet a comment because there are negotiations ongoing, and we have not got the keys here yet, that happens in August. Any new customer would be keen to have Iraq from Whyalla, we would be very keen talk to them. I think it would eat -- product from Whyalla. But I could not talk on that now.You have been following the energy crisis in Australia, I am sure, is that concern you and they can you make Arrium bulletproof?GFC has many pillars, and we have steel and we have mining infrastructure, energy resources in general and we have a financial pillar and property division as well. Those are the pillars support the industrial division. So we are very aware of the importance of energy to the industry, and that has an absolute core focus for us. So when we identified the one steel business, the Arrium business, the Whyalla business in particular, we were busily aware of the issues in SA, and the issues related to power costs, not to availability. And we spent a lot of time analysing that. There is plenty of potential on this site to have generation, so you would be producing steel but also producing sit dividend amount of power. -- significant amounts of power. This site could be a net exporter of power. We are looking at other opportunities on a LAN package we have here, looking at pump hydro and solar, and trying to have a renewable solution that also has storage to the power generation as well.And there is a grisly some State Government support going into the steelworks, reports as high -- obviously some State Government support, is that correct, should State Governments be funding assets that would otherwise not work?$50 million was offered quite a while back, and it has been part of the business planning process for quite sometime. As said, adding was not conditional on any government support, and that is one of the key differences between us and the South Koreans. We pride ourselves on being a preferred partner for governments. So we work very closely with the UK government and with various other governments around the world to execute industrial strategy. So we take a government policy and we find a way to implement that in our industrial vision. So should government be working with a partner like us? Absolutely. And we will do our level best to continue to have a fantastic track record as an execution partner for industrial strategy, and I think government would pride itself on our ability to be their partner.But you will take government money as part of this deal?We have never come to the Australian government for the UK government asking for handouts. We are government are very much more on the ask for a hand up, so it is government support, rather than direct government funding. So if you look at all of our businesses around the world, we try and work with government and have a collaborative cooperation rather than just receiving a handout. Because handouts make businesses uncompetitive. You need to, in a business like this, and is to be globally better.Thank you for joining us there are Whyalla.Thank you.One of three very interesting business Brothers. After the break a look behind China's dairy crackdown from Beijing. Plus does the rising trillion dollar have fund managers worried? -- Australian dollar.

Welcome back. Lots of interest in our Australian dollar, which got awfully close to 80 US cents, thanks in part to Janet Yellen's comments, which the market took to believe that another rate hike is a little further away, perhaps. Might it breaks 80 cents? And what does that mean for funds with overseas investments? Funds like Forage. Steve Johnson joins me. Are you worried about this?I wouldn't say I'm worried. It will certainly detract from performance over the next couple of years. Long-term, this level of 70-80, we were just looking at HR today going back 30 years since the Australian dollar first floated, and that region of 70-80 is where the Australian dollar returns to time and time again. Philip Lowe, at the IBA, would have thought that by now this would be well down below 75. -- RBA.He was not alone. This time last year, everybody was wondering what would happen next financial year, where the Australian dollar would be. A lot of people were talking about 60 something, when the Aussie dollar was mere 70. Those people are not stupid. They are not necessarily wrong. Currencies are just very difficult to forecast. But the Reserve Bank is in a pickle. They will not want the Aussie dollar being higher than where it is. I don't think they want to cut interest rates. They are very concerned about the property market. They can't put them up, can they? They can't. The natural way to get the exchange rate down would be to cut rates further. If we were sitting here in a normally leave and economy, where the debt to disposable income ratio was 150% instead of the 190% it just hit, it would be straightforward for the Reserve Bank to say another rate cut is needed. But they are faced with this dilemma, and I would like to be making that decision, because this high Australian dollar is going to hurt the Australian economy. I don't think we are back at levels of commodity prices and the mining spend that we were out last time the Aussie dollar was up. I think the net effect will be negative for the economy.You have been working very hard, I know, because you put out Forager's annual performance report. You seem to have done well over the last 12 months. I noticed a definite message of managing expectations going forward in the next year. Why? We actually stop reporting. Most fund managers will stalk monthly about what is happening in their portfolio, we stopped that a couple of years ago. We are long-term investors and sell our clients. We don't need to talk about which share prices are up and down over the previous month. We will try to give you more transparency over the course of a year. Here is everything in our portfolio that contributed to performance. Some of them are bad, some of them are good. The results of the past five years for us have been very good. The returns in both our international and domestic funds have in strong. And it has been a very good environment. Pickers like us. The market has gone up 7% per annum since we started...How much is the market and how much are you guys?The market has a 9% and we have done 15%. That is great, it is fantastic, relative to our performance. We have had these regular pullbacks, every time the market has gone up, it has pulled back 20%. 2013, 20 16. What is bad is a market like we are in at the moment, west prices go up and up and up and you'd don't get that pessimism, you don't get the pullbacks. Even pockets of pessimism, when the market was high three or four years ago, mining and mining services were completely unloved and nobody wanted to own them. That has been a big contributor to our portfolio in the past year, buying those stocks to M3 ago. So when I say to everybody to temper their expectations, we might get lots of opportunities tomorrow. I have talked lots of people out of investing in our funds over the years. That hasn't been a great thing. But nobody should expect 20% returns from any sort of investment. Is that why quite a lot of your story is selling off quite a lot of your positions?We have been, yes. We are finding opportunities to recycle money, but we have got, particularly our European Holdings, in our international funds, some of those are up double and triple.You made a lot of money out of a German punter.Out of a German lottery ticket reseller, yes. That was actually an idea that came to us through an Australian investment. Jumbo Attractive. They resell touts' lottery tickets here. -- Tatts'. Jumbo stopped selling in Germany because the competitor was so good. So you thought you would jump in as well!Exactly. That is a good insight into the way we go about picking stocks. People say, how do you do it? There is no fixed formula. It is about keeping your mind open to different concepts and ideas that you see. Different people that you meet.And there are investment, your stock in Harley-Davidson, that went off the boil and that is when you've got in? Yes. That is another example. I think this is reflective of aid will issue market. -- a bullish market. The investment case has not gone as well as when we first bought the stock. We buy businesses and we want the businesses to return on the stocks. Those returns have been a little bit disappointing, yet the stock rises up 30% in the same period of time. -- stock price is up. That is because people are more optimistic about the future than 18 months ago. It is a perfect example of a stock we have sold because the stock rice now reflects that underlying business case. Where we are finding it opportunities is the more cyclical and of the market. Two years ago we could buy high-quality growth stocks. Those are not available at attractive vices any more.You still like mining services? Because overall you have had a very good story with mining services. A couple of them have been awful, but overall, presumably, what has been the difference between the ones that have really failed you and the others?I wrote a blog article this week talking about this concept. We learnt some lessons despite making a lot of money out of that mining services base. The lesson was that in this capital intensive injuries, they grow and shrink, and when they shrink companies go bust. In a perfect and rational world everybody will sit down and say, I will merge my company with yours and we need to restrict capacity and we will go back to making a profit. It doesn't work like that. They all have egos and they all think they will be the one to survive. If you invest in a capital intensive industry, in a downturn, there is lots of other to be made but stick to the better companies in that sector.Steve Johnson, world understeer.Thank you. We have been following the drama at dairy company will ease playing out last week after the shock announcement from Chinese regulators banning milk exports from its newly acquired canning facility. Well this afternoon the company told the ASX that its shares, which have been suspended, would trade again from this Thursday, and told the market that its full year 2017 revenue would be $239 million. But what impact does Chinese interference like this have on a company like Bellamy's and indeed other Australian businesses wanting to do business with China? I spoke with the Australian's China Correspondent Rowan Callick from Beijing.

Roll on, great to catch you. And another shock for Bellamy 's shareholders in the last few days. From the Chinese and, what is going on. Should we be worried about certain Australian companies?I think Australian companies should always be concerned about their markets. In so far as China is one of the biggest for many Australian companies, of course they have to paid close attention to their markets. That is clear. When you buy new sources of your own product, you have to make sure everything is sorted.How much is this a focus on Australia by China?Not really a focus on Australia. China has been going through parrots as is -- paroxysms of trying to grapple, food, safety and health over the last few years. The scandal in 2008 when melamine was introduced into milk in China, causing a lot of rabies to get kidney disease, was terrible. The government -- babies to get kidney disease, was terrible. The government is taking a long time to get to grips with that, with a succession of food scares, so at the same time we are seeing this rapid growth in capacity to pay, and hunger for new foods, from the middle-class year. -- here. Expanding demand, increased pressure on getting the quality right. It is quite hard. China's own inspectors and so on have not had the experience of a long time so that Australia has had, and Australian companies have not necessarily approached China the right way. You would expect that to happen. Some do, some do not. A food expert I spoke to yesterday about this said to me that he was disappointed that Australian and New Zealand companies had not really fully taken advantage of the opportunity of their terrific reputations in the Chinese consumer market.We'd see Australia as having this great opportunity with China on the clean green front. But when the regulators jump in, and due to some complaint by some third party in the case of Bellamys, which we know very little about, there seems to be a ban there. How can an Australian company, how can Bellamys find this out, as I understand it, the morning, through our website, the morning it actually happened? How can Australians get more savvy about it?Yes, the process is pretty poor, isn't it? The answer to your question is that Australian companies need to know the market. They need to build brand awareness and then loyalty follows. They need to build a sense of the whole province of their goods coming into the market, and they need to build a sense among Chinese consumers. They know the story of the product. Just putting things in boxes and shipping it, which is actually what the purely e-commerce route starters, isn't really going to answer that. -- route does. So people need to build that. If you just put staff and advertise it online, Chinese consumers will get the idea you are trying to shift bulk commodities, because you have no other way of doing it. They get the sense that it is going to be discounted, as well. So if you want to realise the margins, you need to go about rings. It is more expensive to do it that way, but you need to approach it that way.Rowan, more broadly, on the China FTA agreement, do you think this sort of banning flies in the face of the FTA? And what should Austrade be doing?It is disappointing. I do not think Austrade can do anything. They are trying to smooth the way for trade. If there is a political question, that is up to the Department of Foreign Affairs and Trade to handle. On the whole, these type of quarantine questions remain in the hands of the governments, in any FTA. But this FTA, as others that we have, set up arrangements so that there is much closer collaboration about quarantine arrangements between the two countries. There is meant to be a committee in which we discuss it. We do not necessarily align our quarantine requirements with china's. We haven't done that with other countries and they haven't done that with hours. -- ours. At the FTE should be helping us to talk were easily and to prevent this sort of surprise from happening.Rohan, thank you. After the break, what to watch in banking and mining, I get the view of top analysts next.

Welcome back. Never a dull moment in the banking sector these days - with on-off bank levies, at least in the case of South Australia, and prospects of further regulatory intervention by both APRA and the Federal Government. I asked CLSA analyst Brian Johnson about what impact these moves will ahve on the sector. Good to have you, we are expecting, an announcement from Apra about capital and banks?We are expecting it for several weeks, and the people who have been following it assiduously for quite a while, and is the financial systems...If it does happen, what are we to expect? There is very little likelihood that banks will be told that they need less capital, I think more unlikely than likely they need more capital, and potentially we are talking about a substantial amount. And then over and above that we have still got the issue of basically home lending, in Australia the banks treat investor loans as they get a concessional, what is called a risk rating, and that is not compliant, so over and above that, I think the capital requirements could go up. There are two distinct elements.It is interesting because the banks are almost in anticipation of this, have got quite different policies now around investor lending, haven't they. A have in raising rates, you know.That is because, it is separate to capital but because of the systemic... We have had the regulator imposed caps on how much investor lending you can do, how much valuation ratio lending you can do, and on investor lending. The regulator seems to be very cognisant that there is a big wave of home investment apartments that are coming on the market in Brisbane and Melbourne and they want to have the capacity for banks to lend for borrowers, to basically by those apartments, but now it would appear...As sophisticated as that, they can actually design things to deal with apartments in Brisbane and Melbourne?At this stage we haven't but that was one of the things basically in the various announcements that APRA have said, is the idea of bringing in geographical constraints like we see in New Zealand. We think about 10% growth in investor lending and still acceptable, that is a big number, well ahead of what the economy is growing out, and the rhetoric when they announced that while they had to leave them flex in the system for these apartments in Melbourne and Brisbane.Overall the motivation for APRA to go further than... Is they worry about the property market, do you think?What kills banks is concentrated correlated exposures to assets, where the asset value has been driven up by leveraged. Not many people...So, yes is the answer?Yes. If you go back to 1992, Westpac lost almost all of its shareholder funds, because they had lots of commercial real estate. It comes down to concentrated correlated exposures, with easy leveraged and housing ticks every single box.At the same time the government has been busy, we have Kelly O'Dwyer talking about new draft legislation to broaden the powers of the prudential regulator, to include non-bank lenders, what is this all about?At the moment, it is kind of complicated, but at the moment banks have to allocate capital base on the assets they hold, but really is is about protecting deposits. Banks plan important role in driving what is going on the economic and when you build up excess risk, that is problematic, and the genuine concern at the moment is that as we squeeze down on banks, then nonbanks move in, and they do lending that creates risks in the system.When you say nonbanks, you mean the ones that do the mortgages?All the non-bank...A small part of the market, it have to say.They are, but when you go back to 1992, Aussie home loans was a small part of the market, and when they came out and discounted by some 200 -based points, the major banks followed.So we have a situation where we have cracked down on the big banks in terms of their lending abilities, but how can we do the same to these nonbanks?The nonbanks typically don't raise deposits, so they found themselves with wholesale money. But before they actually raise the wholesale debt, they go and find themselves with what is called a warehouse from one of the called major banks. What APRA is concerned, they want to make sure that the warehouse funding that the nonbanks are getting from the major banks, they want to check that all the regular tree constraints on system lending apply to the nonbanks with regards to the warehouse funding as well. Generally we can see the availability of credit continues to tighten.Is this going to impact the playing field, which of course all the nonbanks are saying, but the playing field is still kept in the big banks' favour, they are going to be able to use the word banks, as I understand it, but is this extra level of regulation going to quit their wings?Not really. The major wings still have around 80% market share overall, they are still more highly rated because our Bordeaux this applied so they have a cheaper wholesale boring, and let's face it...Will equip the smaller banks wings to have this -- will it clipped the smaller blanks' wings? Everything skews towards the big bank oligopolies.We have just added reporting season with the big banks in the US, what is your take-out an Australian point of view on that US result?From the Australian point of view, what happens when banks go up around the world it tends to drag up the Australia and banks and vice-versa. When you look at the last loss of -- last lot of Australian banks result until March, we saw very strong contributions from the financial markets business, particular ANZ example. And what we basically sort in this period up until June is that we saw sharp declines in the earnings from their fixed interest currency and commodities businesses. Volatility in bonds has come down. So basically, the takeaway is that you would have to think the ability to extract these supercharged treasury earnings probably goes down, if you reverse the trend at the US. Other things going on in the US have very little relevance to Australia, they have impacted share prices but US banks benefit from the end of qualitative easing, that has very little impact on Australia. We are talking about US banks being able to extend their pay-out ratios, where we are seeing in Australia the capital requirement going up, which more than likely route reduces the dividend pay-out ratios. If I was a global investor right now I would feel quite comfortable in selling my Australian banks to buy US banks because all the macro works for them quite well. The only thing that takes away is those declining financial markets earners.Thank you very much. From banking to the mining sector now and we're expecting a slew of production numbers by miners, including quarterlies from both BHP and Rio Tinto. Paul Hissey, analyst at RBC Capital Markets joined me for an update on what RBC is expecting. Thank you for joining us, looking at the mining sector, generally, how do you see production numbers coming out this week?Hopefully we are seeing a bit of a return to those normalised volumes, it given the first quarter we all recall was very soft across-the-board, given, as producers, whether you are a small gold guide or a large diversified person shipping a lot of times. We are looking forward to a recovery in the second quarter -- water giving the lack of a second quarter interruption.Companies do eat it under promise rather than disappoint, you say?Yeah, especially those with a junior -- June year and, if you go back five years or more and plot the fourth quarter efforts, if you like, for a lot of these companies, it is typically the strongest one, and companies will be looking to make sure they make up for that softer third quarter as I mentioned, but comfortable looking to meet their overall annualised output for the year.Let's go to Rio first, they managed to sell that coal and Allied asset, the markets into like that, had you see them going forward? Look, Rio is probably our preferred name among the large stocks, despite the fact the iron ore price has rolled over from those ties with back around the turn of the year, the start of the year, it remains our preference on the back of the strength of those businesses and it is probably a case of avoiding some of the other complications that have perhaps the set BHP at this point in time, the shareholder activism or at even the exposure to oil, which is in for a torrid time from a trading perspective lately, we are looking for a solid quarter from Rio Tinto and it is nice to see the sale of coal and Allied exceeded our price expectations, so I think one of the reasons the shareprice has done well is the anticipation that some of that access valuation or realisation will flow back to shareholders in due course. Although I would stress that Rio being a December year and company, they would tend to pay a sort of second-half skew dividend, suggests that maybe we shouldn't get too carried away the capital management in this first up of the year. With perhaps a higher pay-out coming by the time we get debris 2018.So we can hope. You mentioned a bit of shareholder activism, some people I have spoken to suggested that the company could have gone for Rio, just as much as they could have gone to BHP, do you agree with that? It is easy in the cheap seats, we can all find faults and suggest that there may have been better ways to have run these companies, that is our job on the sell side, but it is easy when you are not on the inside, and what is probably left BHP a little more exposed than some of its peers, is oil, which is the square peg in a round hole so far as a mining company is concerned. Absolutely Rio made some mistakes in the past, as have BHP, and I think we are all aware of what those have been, but it just seems that oil is something that is a bit difficult to competent in a mining company portfolio and that leaves the company perhaps open for extra scrutiny.You are looking for more clarity on oil and gas side?Yeah, I am just not sure that we are going to see anything, immediately. We know there is a new chairman coming in, it remains to be seen to what extent a fresh head of the business, if you like, notwithstanding Mackenzie, who is doing his role, but it remains to be seen what kind of influence a new chairman may be able to have, and how quickly any potential strategy change may be able to take place. I work in progress to BHP, but certainly the stock is underperforming, its large pier Rio significantly, and in the absence of any change in the scenario or strategy I ink that trend could continue. You like Rio Tinto in part due to the quality of its iron ore. When you look like a -- look at a company like four to skew on the other hand, I suppose you are more Skip to: about these sort of performance we have seen, largely off the back of that incredible cost-cutting, going forward, because of quality, is that right? -- company like Fortescue. Yes, it is a tough stock. The share price is going to move in line with the iron ore price. The headline iron ore price. One of the things we are a little bit cautious about and will be looking forward to in the quarterly result is what kind of price realisation Fortescue is able to deliver for the period. In my view, there is quite a complicated and dynamic pricing methodology with distinction between regular or higher grade iron ore going into China as opposed to perhaps some of the lower grade material which we know four to skew cells, the 56% or 58% iron ore product. -- Fortescue sells. It is hard to get a bead on demand. Anecdotally we are hearing that throughout the quarter daywear additional discounts that Fortescue sold their products out, well below the historic guidance range, which is 85- 90% price realisation on a benchmark 62% iron ore price. I think the market is waiting to see what that looks like and the expectations are that it will be weak and perhaps even weaker than the first quarter.And South 32, because they had a surprisingly good run compare to how people thought about South 32 when it first set out?South 32 is in a great position. It has a killer balance sheet. The company is in a net cash position and is producing good cash from all its operations at these current price levels. I must admit I was surprised that the strength of the stock throughout the quarter. Trading through some of the news in South Africa regarding the new mining legislation. Although the reality is that perhaps it could be a long time before we see that implemented in any form. Look, balance sheet and cash flow are king, and the company is in very good health there. I think the market is anticipating additional capital management again coming through at the end of the year. Briefly, gold looks positive again, largely because of all these drums around the world. -- dramas around the world. Your take on the gold stocks?Northern Star would be our preference in this space. That is a stock that we think about some volumes over the next couple of years at a very high capital efficiencies. Interesting to know that the gold price was flat throughout the half, but most of the gold stocks in the Aussie universe put on between 10% and 20% in share price performance. That is quite positive and suggests that investors are warming up to this base, even though they are perhaps not getting that headline commodity price movements traditionally drives these companies. I would add that there has been a lot of ETF lows in this space, and that is quite significant and having a significant impact on the share price. -- ETF flows. We are still broadly constructive. Gold has recovered well from the softness in the last couple of days and it looks to me like it is building a base, which should be healthy for the stocks, which are fantastic margins and excellent balance sheets.I feel more informed. Paul, thank you.Thank you.After the break, the seven network was Mac battle with Amber Harrison comes to an end. Details Max. -- Seven Network's battle.

At the final showdown, the tables turned dramatically in the court case involving Seven's CEO Tim Worner and Amber Harrison, the employee who became involved with the Seven chief before things got very ugly for both. Today, the court ruled in favour of Seven. The Australian's Margin Call editor Will Glasgow has been following the trial and joins me in the studio. Were we expect in this? Tim Worner and Bruce McWilliam must be pretty happy.Actually, the result itself in court, in, everybody saw this coming. This was...Not a few months ago they didn't.No, a few months ago this was wide open and was being run in the Supreme Court and the Federal Court, and Amber Harrison had Julian Burnside and was talking about running a fair work claim against Seven and its culture. It was terrifying stuff for the media network. They were able, as you said, would risk McWilliam, they worked furiously on this thing to limit it to the Supreme Court and just a case about a contract. That is what the judge ruled on today and he was pretty damning in his judgement.He said the entire process had been vitriolic.Yeah. I think... I mean, it sure has. If anything, he is understating that. The campaign that the two waged since Amber went public in December with her story about the affair she had, this torrid affair with Tim Warner -- Tim Worner, and her account of what happened next, you know, what the company did to cover that up, and the involvement of the board and the executive teams, which they were involved in almost three years after she first told the company about the affair in 2014, in quite weird circumstances... Yeah. The judge is quite right. So Seven has won.Now, in theory, and the Harrison has to pay costs.That is right. The one thing that Amber Harrison argued against in this contract case, she accepted she was in breach of the deed. I don't think anybody has been more in breach of a contract then Amber Harrison. One of the clauses was that she wasn't allowed to talk about the company and private information. Since December, she has reached the whole lot.Can she pay?They pursued her on costs and she opposed that. Seven, privately, they don't think she has any money but they wanted to get his judgement from the court.So what are they going to do next? Well, the judge has said, yes, he has awarded indemnity costs. That is 95% of Seven's bill. What Seven meets to decide is what de Villiers. In a funny way, normally would say...Do the shareholders know what de Villiers?Exactly. Can they handle the truth? The number they are talking about disclosing only goes back to February, and only in the Supreme Court. The cost for Seven is millions of dollars because it has been run for three years, it has been into tears of courts, it has been in mediation three times and it has involved cases against media companies that have reported on it.That will be interesting to see. What about Tim Worner himself? Obviously he has kept a low profile. His reputation has been knocked. Are we going to see him back at sporting events, hosting things?Well, he came off the Sydney Swans board early in the year. He has only had one outing since Amber went public in December. One outing all year. That was down to Canberra for a media reform summit. Seven's results are due next month, so we will see him then. Whether it gets back to business as normal, whether there is another normal for Tim Warner again, as a CEO, we'll find out. -- Tim Worner. Thank you. That's all for the show tonight - tomorrow night, Chairman of Telstra, and Toll Group, John Mullen. Thanks for your company.

Hello, I'm Peter Switzer - Welcome to the program which puts you in touch with the best and brightest minds in business. We are broadcasting from Melbourne tonight. We will look at what is going on with earnings season in the US going US and here, on a day when Telstra dropped nearly 4%, dropped nearly 4%, all
dropped nearly 4%, all will rate the stock, is a dividend cut coming up? We find up wide women have a black spot when it comes to super, and where are the wealthy investing nowadays? David Salmond will tell