It’s Wednesday the 7th of May, and big business is confident about Australia's outlook following the federal election. Netflix earns big but pays little tax, around 7,000 builders and subbies have collapsed in three years, plus household spending disappoints. Oh, and Donald Trump wants to reopen Alcatraz.

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News in brief

The bosses of Macquarie Bank, Westpac and Wesfarmers, among others, are confident about the Australian outlook amid global uncertainty, saying we benefit from having a new stable government and being an attractive destination for global capital.

Netflix has reported a sharp jump in Australian revenue to $1.3 billion, most of which was sent overseas to reduce its local tax obligations. Netflix has an estimated 6.2 million subscribers in Australia and posted a $23.3 million profit in the 2024 calendar year, according to annual accounts lodged with ASIC.

The boss of building group Mirvac says the collapse of almost 7,000 builders and subcontractors in the last three years is weighing on developers, pushing up the cost of building a new home amid the housing crisis.

Household spending disappointed in March, with turnover going backwards. It's the first fall after five consecutive positive months, hit by ex-tropical cyclone Alfred in Queensland.

Donald Trump wants to re-open the notorious Alcatraz, the prison island in San Francisco Bay. It's been closed as a prison for 60 years. Trump wants to substantially enlarge and rebuild Alcatraz to house “America’s most ruthless and violent offenders.”

Fear-o-meter

The annual Macquarie Conference is under way and more than 100 companies are presenting to big investors. Almost across the board, CEOs want the Albanese government to take advantage of its mandate and undertake meaningful reform on important issues like productivity and fiscal policy.

They are also warning that consumers are finding it very tough at the moment. Wesfarmers owns Bunnings and Officeworks and its boss Rob Scott says low income earners are struggling. Across the board, consumers are only “okay.”

Westpac CEO Anthony Miller says things aren’t getting worse, but many people are still struggling.

On top of that, yesterday we got official ABS statistics that show the building sector stagnated in March, and the consumer sector is, at best, soft.

All this points to the need for an interest rate cute on 20 May when the Reserve Bank board next meets.

Who's talking today?

On how the Liberals recover from an electoral thrashing, and whether Labor has the political courage and will to use its huge win and mandate to implement major change:

 

"There's a big win, but there's been big wins in Australia in the past. Think of John Howard in 2004, who had both the House and the Senate and was out of his own seat and certainly out of leadership three years later. Campbell Newman had a stonking win in Queensland and was gone at the next election. These things can have a great power and great possibility, but also high risk as well. 

 

Anthony Albanese still faces and the country still faces those same challenges that were there two weeks ago. Housing is a huge issue. The cost of living remains a struggle. Productivity is the biggest challenge that our economy faces and without increases there, things get worse. There is a large amount of debt and deficits still to come as well that need to be arrested at some point. And that's not to mention the bigger issue of trade, potential trade wars between US and China, actual war in the Middle East, actual war in Europe and great uncertainty around the world."

Greed-o-meter

Streaming in Australia is becoming a very crowded market following the arrival of Max five weeks ago. And apparently profit margins are slim: Netflix posted a $23.3 million profit last year, and it leads the market in subscribers. Here's where the main players are sitting right now.

Sources: Mumbrella, Techradar, The Australian

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