Wry & Dry: a cynical and irreverent review of the week in politics, economics and life. For intelligent Readers who disdain the trivial.
Investment Matters
Craig this week…
- Reviews the possible investment consequences of higher inflation
- Provides a deep dive on Woolworths’ market update
To read Investment Matters, you can still just click on the link at the bottom of this week’s Wry & Dry. Or here.
Wry & Dry’s musings…
Sussan Ley’s tenure at the top of the Liberal Party looks increasing like that of a lettuce. Trumpster’s bluster about election of a radical left-wing mayor of New York missed the main story: swings of over 7% away from Republicans in special state elections. Is this the beginning of the end of the penny section for MAGA?
On Tuesday it will be 50 years since the imperious PM Gough Whitlam was given the DCM by the GG. Expect the hagiographic media articles to overlook one glaring hypocrisy.
1. Well, she has lasted longer than a lettuce
Federal Liberal Leader Lettuce Ley1 has net approval rating of -33, according to NewsPoll. Not quite as bad as Andrew Windsor. Nor that of any of seven recent wannabe PMs. But it’s very long odds that the comebacks of Tony Abbott and John Howard will be repeated by her.
Why is she still in the top job?
The answer is that no-one else currently wants it. There is thinking that it’s better for Lettuce Ley to stumble on and lead the party to a loss that probably couldn’t get any worse than last time, but unlikely to get better. The longer Uncle Albo has to stumble, the more likely he will fall.
However, consider the most uncomfortable horns of a quadlemma upon which Ms Ley now finds herself impaled:
- The Gnats have just given Net Zero the DCM, for fear of losing votes to One Nation;
- …but the Gnats cannot win an election in coalition with One Nation.
- The Conservative Liberals want to keep Net Zero, for fear of losing votes to the Teals;
- …but the Liberals cannot win an election in coalition with the Teals.
The solution for the Liberals is to either (a) allow Labor to stay in government until past 2050; or (b) repackage Net Zero and leadership.
Which again brings Wry & Dry to the latest Newspoll, where the number 24% hit the headlines. That number is the Liberal’s primary vote. But the 2PP vote remains unchanged, at a still shocking 43/57, but helped by minor party preferences. The base is holding…its breath under water.
The solution is (b). Wry & Dry suggests the Liberals give the desperately trying Lettuce Ley the DCM, and instead elect a highly intelligent and charismatic Liberal, who has a spine. There are two alternatives.
1 Former UK Prime Minister Liz Truss was famously forecast by the Economist “not to last longer than a lettuce.” The British tabloid Daily Star turned this into a viral stunt by livestreaming a 60p supermarket lettuce next to a photo of Truss, asking which would last longer. The lettuce won. Truss resigned after just 44 days in office, making her the shortest-serving Prime Minister in UK history. Ms. Ley has lasted 178 days as Opposition Leader.
2. The beginning of the end?
Trumpster had been relishing the possible victory of a 34-year-old radical left-wing, socialist, Muslim, former rap producer and tenant organiser in the New York mayoral election. Imagine what he can blame on Zohran Mamdani. And by extension the Democrats.
He has his wish, The Zee won by over 7% points on Tuesday. But, as doubtless a Chinese philosopher once said, “be careful what you wish for.”
Y’see, The Zee doesn’t really matter. Neither does his election. Trumpster beating up The Z is not going to assuage Main Street’s grumpiness.
The real grumpiness-signposts for Trumpster came in massive swings against Republicans in state elections in Virginia and New Jersey.
Tt might get worse for Trumpster. The US Supreme Court is, as Wry & Dry quills, hearing a claim against Trumpster’s tariffs, essentially that only Congress is authorised to raise taxes and tariffs. Which is why the US Solicitor-General led Trumpster’s defence by telling the court on Wednesday that tariffs “are not revenue raising tariffs.”
The good folk on the bench responded to this cant with a thumbs down. Chief Justice John Roberts said Trumpster’s “vehicle [tariffs] is imposition of taxes on Americans, and that has always been the core power of Congress.”
It looks likely that six of the nine justices will give Trumpster a headache visible from Mars.
Tuesday’s elections might be an electoral Petri dish for next year’s mid-term elections. Republican’s control of the house is at risk of defenestration.
3. It was 50 years ago today…2
…well 50 years ago next week, when the G-G gave the DCM to then Labor Prime Minister Gough Whitlam. Doubtless tomorrow’s newspapers will be full of hagiographic retrospectives.
There will be, firstly, retrospectives of Whitlam’s achievements, his imperial ego and the alarming incompetence of his government. The second will be of The Dismissal, i.e. his sacking by the Governor-General.
In 1975, the Opposition (Liberal + Country Party), led by the Easter Island statue-like personality of Malcolm Fraser, wanted an early election as the government was amazingly unpopular. And he wanted to live in The Lodge. This could be done, simply put, by using its numbers in the Senate to effectively reject the budget, i.e. denying supply. The grounds for a double dissolution would be met.
Whitlam went nutzo at the Senate denying supply (i.e. voting down the budget), or indeed any House bill.
What people have forgotten is that Whitlam tried to do the same in 1970, when he was Opposition Leader against the mercurial Liberal PM John Gorton. Then, the government did not control the Senate (holding 28 of the 60 seats).
In his budget-reply speech in August 1970, Whitlam announced his intention to force an early election, by opposing the budget. “…we will vote against the bills here and in the Senate. Our purpose is to destroy this budget and to destroy this government …”
Whitlam carried out his threat. But to no avail. In the Senate, the Democratic Labor Party sided with the Coalition government.
The point is that Whitlam and his apologists stated that Malcolm Fraser’s decision to vote against the 1975 budget was unprecedented. And a breach of an entrenched constitutional convention. Err, wrong. Whitlam himself was the precedent of his own downfall.
In any case, the G-G’s actions were vindicated by They The People: Labor lost 30 of its seats in a 7.4% points rout.3 This was the largest ever swing against a federal government in a general election.
2 Thanks to G. Brandis for the inspiration for this piece.
3 By way of comparison, in 2025, the Coalition lost 17 seats in a 3.1% swing.
4. Simandou who? What?
A couple of weeks ago, First Samuel’s CIO and author of Investment Matters, alerted clients and Wry & Dry’s Readers to the impending commencement of the massive Simandou iron ore mine in Guinea.
Y’see, over 90% of the iron ore will go to Emperor Eleven. That is as much as 90 million tonnes each year. This will cause iron ore prices to significantly fall. The story is now rippling across the media.
Independent economist and budget guru Chris Richardson has now come out and said (in today’s Financial Review) that the mine and its adjacent mine will cost We-the-Taxpayer some $10bn because lower iron ore prices will mean lower profits from Western Australian iron ore producers. Lower profits mean lower tax revenue.
What will Grim Jim next do?
5. No domestic bliss
It is a good thing for Uncle Albo that he hasn’t used up his frequent flyer kilometres. Otherwise, he would have to fall back on domestic bliss, of which there is little. What is his worst problem?
a. Inflation is much higher than forecast (blame Chalmers?);
b. the signature super-dooper additional superannuation tax got the DCM (Chalmers);
c. the promised 83,000 new home-care packages didn’t fly (Butler);
d. the productivity summit expectations were truncated (Chalmers);
e. slow rollout of cheap renewable energy is causing smelters to close (Bowen); or
f. the new home deposit would raise prices after all (Uncle Albo).
Close, but no cigar. The correct answer is not listed. It is if the Liberals elect a highly intelligent and charismatic leader, who has a spine.
6. Andrew who?
After Tuesday, the name Andrew Windsor has disappeared from the quality UK newspapers. Normal programmes have been resumed: the UK Telegraph reported on Wednesday that: “Labuschagne called up and could open for Australia in first Ashes Test.”
Priorities, at last.
7. Free electricity?
It sounded too good to be true. Give We The People three hours of free electricity each day, when excess solar power is fed into the grid.
Climate Change and Energy Minister Bowen The Zealot shouted the good news via his solar powered megaphone.
Err, the good news is fake news.
Y’see, the cost of the electrons (so to speak, i.e. the wholesale price of electricity) makes up 35-40% of the retail price. Network charges (e.g. ‘poles and wires’) make up 40-45%, environmental schemes and regulated costs 5-10%, and retail margin 8-12%.
So, the cost of the 60-65% that is not the electrons must still be recovered. If the total price is free for three hours, then the 60-65% must be spread over the other 21 hours’ costs.
Bowen The Zealot didn’t even have courtesy of consulting with electricity retailers.
8. Spot the trend
The below is a public service announcement.
Snippets from all over
1. Switzerland plans to halt immigration
Switzerland is considering a plan to cap its population at ten million, with a package of anti-immigration policies that would automatically kick in if the figure rises too high. (The Times)
Wry & Dry comments: Its current population is 8.9 million.
2. No-one brands it like…
Sir David Beckham, a longtime supporter of the royal family, has received a knighthood at Windsor Castle. (The Times)
Wry & Dry comments: He was happy, but not half as much as Lady Victoria.
3. Elon Musk’s $1tn pay deal
Tesla investors have overwhelmingly backed Elon Musk’s $1tn pay deal, hoping that the prospect of the largest payday in corporate history will persuade the billionaire to focus his attention on the electric vehicle maker. (Financial Times)
Wry & Dry comments: To reach $1tn, he must sextuple Tesla’s valuation to $8.5tn, boost earnings 24-fold to $400bn and sell millions of robots and autonomous driving subscriptions. Over the 10 years the plan covers, Musk will receive no salary or bonus.
4. Andrew Windsor to get a pension
Andrew Mountbatten Windsor will be eligible to claim the state pension next year, worth around £9,000 annually. (UK Telegraph)
Wry & Dry comments: He gets the dosh because of his naval service. Will he follow the example of his brother and pay the amount to charity?
5. Republicans’ gerrymandering
President Donald Trump has notched some victories in his redistricting push, which aims to give Republicans a better chance of retaining their majority in the House of Representatives. Looking ahead to next year’s midterms, three states have redrawn a total of seven districts to favour Republicans. (The Economist)
Wry & Dry comments: Of course, Democrat states have responded: California and Virginia are also ‘redistricting’.
It figures
- 5.3%: New Zealand, unemployment rate, the highest since 2016.
- 4.0% UK, the rate at which the Bank of England left interest rates unchanged.
And to soothe your troubled mind…
“I super appreciate it.”
Elon Musk, speaking after Tesla shareholders voted to provide a one trillion-dollar incentive package.
Wry & Dry comments: I bet he does appreciate it.
Read this week’s Investment Matters here.
Disclaimer
The comments in Wry & Dry do not necessarily reflect those of First Samuel, its Directors or Associates.
Cheers!
Anthony