Gina Rinehart. Photo: Bloomberg

Billionaire Rinehart and friends could spark a gold and silver frenzy

Billionaire Gina Rinehart has the money and advisors to bring about a tectonic shift in world markets — and make a stupendous amount of money.

It is a well-publicised fact that Ms Rinehart is worth about A$20 billion — a fortune derived from West Australian iron ore.

What is less known is her circle of advisors.

Gina Rinehart part-sponsored Lord Monckton’s visit last year in her battle against the carbon tax.

The Mannkal Economic Education Foundation recently released a video of Lord Monckton. In it he reveals a plan to take over Australian media in the cause of defeating the carbon tax and mainstream climate science in Australia.

Lord Monckton hopes that what has been done to elevate Andrew Bolt to prominence can also be done for one Joanne Nova. Starting at 0:32 he says:

Look at the effect Andrew Bolt has had since he was rocketed to fame — and I think without giving away too many secrets Joanne’s going to end up doing quite a bit more on that channel if all goes according to plan.

At 1:22:

And it seems to me that putting some time into encouraging those we know who are super rich to invest in even establishing a new satellite TV channel is not an expensive thing and then get a few Jo Novas and Andrew Bolts to go on and do the commentating every day.

Lord Monckton is referring to Joanne Nova, a climate-skeptic blogger. Her husband Dr David Evans is also a prominent skeptic. Quite apart from their climate campaigning they have another venture together called Goldnerds. You can see an ad for Goldnerds on her blog, down the left sidebar. Nova and Evans are not your average gold investors. You can surmise they have the ear of Gina Rinehart to the extent she is willing to spend hundreds of millions of dollars in pursuit of common goals.

In 2007 Nova and Evans did a roadshow to launch Goldnerds. The gatherings — informal lunches with like-minded gold investors — were promoted through Bill Murphy’s LeMetropoleCafe.com.

Bill Murphy and the organisation he chairs, GATA, have a radical but increasingly accepted take on the gold and silver markets — that they are markets in name only, subject to intensive covert manipulation on behalf of central banks.

Critical to the GATA thesis is that demand for gold will continue to overwhelm the supply (real or apparent) conjured up by central bank machinations. This imbalance will grow until the present fiat currency system fails and gold is placed once again at the centre of world finance.

The roots of the GFC and current Europe debt crisis stem from excessive growth of debt, both public and private. By discouraging investors from defecting into gold, central banks have distorted capital allocation. For decades capital has been “invested” in asset bubbles including an extraordinary array of exotic derivatives. Though some bubbles popped, bigger bubbles have been blown to take their place. The whole system is due to implode.

And it will implode sooner rather than later if gold and silver investors, rather than accept paper substitutes, “cash out” by demanding delivery of physical gold and silver.

Rinehart’s anti carbon tax campaign is public. But just out of view, is she expending similar if not vastly greater funds in relation to gold and silver?

Monckton in the video above spoke of elevating Joanne Nova in the same way Bolt was elevated on Channel 10, which Rinehart has bought into. Nova and Evans, having built a rapport with Rinehart, have likely filled her in on the tremendous profit-making opportunity that exists in precious metals.

In November Dr Evans was one of a number of prominent commentators who gave presentations at a gold symposium held in Sydney. Canadian billionaire and precious metals fund manager Eric Sprott was the keynote speaker.

It is no mean feat to attract a billionaire fund manager to a conference. Someone put up the financial guarantees to covers expenses and made it worth Mr Sprott’s while. Rinehart may have invited Sprott for discussions regarding investment in precious metals.

Coincidentally Sprott asset management has made new offerings for their PHYS (gold) and PSLV (silver) funds amounting to in excess of US$650 million. However it is an open question whether there is even enough available silver and gold to meet demand from Sprott’s funds. With investment funds from the likes of Gina Rinehart, Sprott could bring the fractional-reserve bullion banks undone. Gold and silver prices could launch to unprecedented highs as investors rush to purchase from a very limited supply.

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