Follow by Email

Thursday, May 23, 2013

Gina Rinehart lost 7 billion dollars last year

Gina Rinehart is still Australia's richest person according to the 2013 BRW Rich 200 list.  Even though she lost 7 billion last year, her net worth is still $22.2 billion.  Miners across the board have been hit by around 30 per cent because of lower commodity prices.   Westfield Group owner Frank Lowry came in second and James Packer with his gambling investments came in third.

Frank Lowy

Ms Rinehart doesn't do interviews with the media, she just releases statements but this time, she chose to make a video to get her point across.  She warns that Australia must take action to avoid ending up like Europe.  "It is as if Spain, Greece, Britain, Italy and Portugal had no warnings to give us about the similar path we are now taking" she said.  "It is as if their struggles with unemployment, riots, increased crime, debt and sheer lack of money for even essential services, had nothing to teach us."

PM Julia Gillard dismissed her claims as "absolute nonsense" and said we have nothing to worry about because we have a triple-A rating and avoided recession for 21 years.  But what the PM failed to mention was that our good fortune is mainly due to past conservative governments who have produced consistent surpluses.  When Labor came to power they inherited a huge surplus thanks to John Howard and Peter Costello, and if Tony Abbott is elected in September, he'll inherit a huge black hole that will take years to fix.  The irony is, if he gets the budget back on track, in another three years, he'll be voted out again.  And so it goes.

Gina's video upset a lot of people, to say she's not exactly popular would be a gross understatement.  Here is part of what she said.

"What few seem to properly understand - even people in government - is that miners and other resources industries aren't just ATMs for everyone else to draw from, without that money first having to be earned and, before that, giant investments are made.  It is incredible that after the last six years of record commodity boom times, we now find the once lucky country in record debt, with the federal budget tipped to deliver yet another deficit, to further increase our record debt.
This debt is simply unsustainable, especially when Australia faces an increasingly elderly population with increasing needs, and fewer workers to pay for it all.  This lucky country has got to start thinking and acting."  And then "Too many of our governments seem to have had their thoughts clouded by six record years of revenue.  They seem to think the ATM would never empty, and never need refilling.  They seem to think we could somehow afford to be increasingly cost un-competitive and become deeper in debt."
A few years back when Labor introduced the mining tax, Gina jumped on the back of a truck and yelled with enthusiasm "Axe and tax" and if Tony Abbott is elected in September, that's one of the first things he will do - scrap the mining tax along with the carbon tax.

There are basically two opposing opinions about Gina Rinehart.  The right think she's a brilliant business woman who knows what she's talking about.  The left think that because the minerals in the ground ultimately belong to the people of Australia, she can afford to pay a bit extra and therefore the mining tax is well justified.

But after the Prime Minister, she's probably the most despised woman in the country.