Are Rare Earths Rare?

Global Rare Earth Production History

Global Rare Earth Production History

Original Image

China Embargoed Rare Earths

In a recent ‘spat’ over water and fishing rights, China put an embargo on sales of “rare earth” elements to Japan. These have economic and strategic importance in that they are widely used in electric motors, high performance magnets, and a variety of electronics. Since China is presently the source of over 90% of the rare earths, this was a significant boot to the neck of Japan.

So, many folks have leapt to the conclusion that China has some special lock on the global distribution of rare earth minerals. Are we in fact slave to China having the natural abundance and the rest of us impoverished?

Common Rare Earths

From the wiki, we learn that at one time rare earths were rare, as they were thought to come only from rare oxide deposits:

The term “rare earth” arises from the rare earth minerals from which they were first isolated, which were uncommon oxide-type minerals (earths) found in Gadolinite extracted from one mine in the village of Ytterby, Sweden. However, with the exception of the highly-unstable promethium, rare earth elements are found in relatively high concentrations in the earth’s crust, with cerium being the 25th most abundant element in the Earth’s crust at 68 parts per million.

Hmm, that doesn’t sound so rare…

Are they hard to extract? Well, they used to be. Now we use a variety of techniques.

In the 1940s Frank Spedding developed an ion exchange procedure for separating and purifying the rare earth elements.

“Ion exchange”. That’s what is used in your water softener. I’m sure the rare earth ion exchange is more complicated, and probably uses a far more expensive ion to exchange than ‘salt’. But still, it’s not that hard a process. A mineral or resin has one type of ion absorbed into it, a liquid solution is run over it and the ion in the resin moves into the liquid while the desired ion goes into the resin in exchange. When the ‘regenerating fluid’ is run into the reactant bed, the swap goes the other way. In the process, a very dilute concentration in the original liquid becomes a very high concentration in the effluent of the reactor (and a fairly clean solution in that it contains the target ions and the reactant ions primarily).

The principal sources of rare earth elements are the minerals bastnäsite, monazite, and loparite and the lateritic ion-adsorption clays. Despite their high relative abundance, rare earth minerals are more difficult to mine and extract than equivalent sources of transition metals (due in part to their similar chemical properties), making the rare earth elements relatively expensive. Their industrial use was very limited until efficient separation techniques were developed, such as ion exchange, fractional crystallization and liquid-liquid extraction during the late 1950s and early 1960s.[3]

So they are more expensive due to the extraction and separation from a bunch of similar ions, but folks have worked out ways to do that. So the cost is not from scarcity of ore, but from the process.

Of these, “monazite” caught my eye. This is a modestly common mineral (often a sand) used to mine Thorium. Thorium can be (and presently is being) used in nuclear reactors to generate power much as Uranium is used. In fact, Thorium is turned into U233 during the fuel burn up.

From:

http://www.galleries.com/minerals/phosphat/monazite/monazite.htm

Notable Occurrences are wide spread and diverse. They include beach and river sand deposits from Travancore, India; Australia; Brazil; Sri Lanka; Malaysia; Nigeria; Florida and North Carolina, USA. Pegmatite sources include Encampment, Wyoming; Petaca District, New Mexico; Amelia Court House, Virginia; Climax Mines, Colorado; Maine; Alexander and Madison Counties, North Carolina, USA as well as Callipampa, Bolivia; Madagascar; Norway; Austia; Switzerland; Joaquim Felicio, Minas Gerais, Brazil and Finland.

Humphf… Sounds pretty common to me…

But What About The Graph?

Doesn’t that show the USA running out and China taking over?

Nope.

It shows the USA shutting down production, but not running out.

Like most other manufactures, it’s simply cheaper to do it with labor at $2 / day and with hardly any regulations (and very low capital gains taxes) than to do it in the USA with $50/hour (or more) Union wages, busloads of regulatory paperwork needing $500 / hour lawyers to review, agency permits that are not granted (try getting a mine open in California… we used to mine rare earths, but shut the mine as it was too much trouble to keep it open and Chinese prices undercut the market) and then you face the 2nd highest capital gains tax rate in the world if you do get past those hurdles.

So we have mining and refining running off to China.

We are shutting down, not for lack of resources, but due to the mercantilist policies of China.

Why Does This Matter?

Because rare earths are necessary for a large number of critical devices. Everything from exotic lenses ( I have a lanthanum eyepiece for my telescope, for example) to electric motors and electronic parts, to parts in cruise missiles and other weapons systems and medical equipment like x-ray machines.

And now we know that China is quite happy to use it’s economic position as a weapon to get what it wants. Japan folded the next day and gave in to Chinese demands…

So how will the USA react when, for example, China says it’s time to hand over Taiwan, or perhaps to shut down those bases in Japan that we don’t need any more? And how will we react when told that there will be no more goods sold to the USA until those things are done?

Think we would just say no? Go to a department store and visit the clothing, housewares, toy department, you name it. Look at the country of origin. I just did this at a teacher supply store. I found one thing (a floor jigsaw puzzle of the US Presidents) made in America. One each from Korea and Taiwan, and an endless stream of “Made in China”.

Any Other Problems?

Oddly, the mining of rare earths from things like the Monazite Sands in the Carolina’s is complicated by the presence of Thorium. Rather than us the Thorium for energy production, we treat it as waste. And even mildly radioactive waste causes “issues”.

From: http://www.marketoracle.co.uk/Article20622.html

There are contaminants that can limit the ability to conduct economic work on a deposit or even limit the ability to exploit it at all. Thorium is one of the more common contaminants that you find accompanying many rare earth element deposits. Thorium is a radioactive element that someday may have uses in the nuclear power industry but, right now, if you have enough of it in a deposit, your tailings are radioactive. You must have the appropriate permitting to store those tailings, or you’re never going to start a mine.

Looks to me like a ‘win-win’ to just mine BOTH Thorium and Rare Earths. Get energy independence AND high tech resources…

from: http://www.evs.anl.gov/pub/doc/Thorium.pdf

Where Does It Come From? Thorium is widely distributed in small amounts in the earth’s crust. The chief commercial
source is monazite sands in the United States (in North Carolina, South Carolina, Idaho, Colorado, Montana, and Florida)
as well as in Brazil, India, Australia, and South Africa. The concentration of thorium oxide in monazite sands is about 3 to
10%. Thorium is also found in the minerals thorite (thorium silicate) and thorianite (mixed thorium and uranium oxides).
The isotope thorium-230, a decay product of uranium-238, is found in uranium deposits as well as in uranium mill tailings.

So what is Monazite? (Ce, La, Th, Nd, Y)PO4, Cerium Lanthanum Thorium Neodymium Yttrium Phosphate.

Notice that we get phosphate too. So lets think about this for a minute. Some folks are just all crazy over the pending demise of civilization from running out of energy, phosphate fertilizer, and the limited availability of Rare Earths. Yet in some of the most common rocks (and sands) on the planet we get a bunch of rare earths, Thorium for energy for the next 30,000 years, and , oh yes, phosphate.

Somehow I’m not worried about “running out”…

And is it India and the Carolinas that are so uniquely blessed? Nope. Look again at that quote from the USGS article about Thorium:

The chief commercial
source is monazite sands in the United States (in North Carolina, South Carolina, Idaho, Colorado, Montana, and Florida)
as well as in Brazil, India, Australia, and South Africa.

All over the USA, Brazil, Australia. Just waiting to be needed.

Back To China

As an interesting insight to the mercantilism of China, they also observe this about the general Chinese restrictions on total exports (not just the Japanese embargo):

That’s not what the Chinese are envisioning, though. I think that by limiting the export of these materials, China is intending to move a lot of those refining operations and a lot of those final assembly operations into China. This is a still a very labor-intensive operation at that stage, and China is trying to bring those higher value jobs back to China. Unless we actually produce alternative sources of REEs outside of China, frankly, the companies in the U.S. and Europe and elsewhere will have no choice; those jobs will go to China because that’s where the material is. We still consume most of the end products; it is not the Chinese buying electric cars. It’s Europeans and Asians in Japan and Korea and people in Europe who are buying those, but it’s the Chinese who are going to be ultimately building those for the next few years, unless we find alternatives.

So much for Obama and the Dimocrats notion that we’re going to build all that ‘green stuff’ here and dominate e-cars globally. Hey Obama!: China has your number and is planning on eating your lunch! Good Luck with that…

The “Marketoracle” article is a good one and worth reading. It talks about particular mines in places like the USA and Australia. So hit the link and read the article (and it’s disclaimers) if you have interest.

Going Forward

What was ‘the worlds largest rare earth mine’ is in California. It was shut down when China was selling all you wanted dirt cheap. With luck, we can find a way to get it back open (there are efforts underway to do that for 2011, but who knows what California will do.) The Mountain Pass Mine.

http://en.wikipedia.org/wiki/Mountain_Pass_rare_earth_mine owned by Molycorp.

The Mountain Pass deposit is in a 1.4 billion year old Precambrian carbonatite intruded into gneiss, and contains 8% to 12% rare earth oxides, mostly contained in the mineral bastnäsite. Gangue minerals include calcite, barite, and dolomite. It is regarded as a world-class rare-earth mineral deposit. The metals that can be extracted from it include:
Cerium
Lanthanum
Neodymium
Europium
Known remaining reserves were estimated to exceed 20 million tons of ore as of 2008, using a 5% cutoff grade, and averaging 8.9% rare earth oxides

Notice that reserves are measured in MILLIONS of tons; while on the graph, world production is in KILO tons. Not exactly a shortage…

The Mollycorp chart?

It looks like a recent spin-out of a parent, with a short history, that is a rocket ride up (probably driven by recent news).

Mollycorp MCP 3 month daily interval chart of stock prices

Mollycorp MCP 3 month daily interval chart of stock prices

I’d be willing to buy a ‘tiny’ of it but be cautious with any ‘rocket ride story stock’ like this, they will often crash as the news fades. But given the Chinese behaviour, I expect a US Government driven initiative for some USA capacity and would also expect some Japanese makers might want a 10% or so ‘second source’ as insurance…

What about the kind of mineralization at the mine?

Crystal of Bastnasite

Crystal of Bastnasite

http://en.wikipedia.org/wiki/File:Bastnasite-(Ce)-177535.jpg

http://en.wikipedia.org/wiki/Bastnäsite

In 1949, the huge carbonatite-hosted bastnäsite deposit was discovered at Mountain Pass, San Bernardino County, California. This discovery alerted geologists as the existence of a whole new class of rare earth deposit: the rare earth containing carbonatite. Other examples were soon recognized, particularly in Africa and China. The exploitation of this deposit began in the mid-1960s after it had been purchased by Molycorp (Molybdenum Corporation of America). The lanthanide composition of the ore included 0.1% europium oxide, which was sorely needed by the burgeoning color television industry, to provide the red phosphor, so as to maximize picture brightness. The composition of the lanthanides was about 49% cerium, 33% lanthanum, 12% neodymium, and 5% praseodymium, with some samarium and gadolinium, or distinctly more lanthanum and less neodymium and heavies as compared to commercial monazite. However, the europium content was at least double that of a typical monazite. Mountain Pass bastnäsite was the world’s major source of lanthanides from the 1960s to the 1980s. Thereafter, China became increasingly important to world rare earth supply. Chinese deposits of bastnäsite include several in Sichuan Province, and the massive deposit at Bayan Obo, Inner Mongolia, which had been discovered early in the 20th century, but not exploited until much later. Bayan Obo is currently (2008) providing the lion’s share of the world’s lanthanides. Bayan Obo bastnäsite occurs in association with monazite (plus enough magnetite to sustain one of the largest steel mills in China), and unlike carbonatite bastnäsites, is relatively closer to monazite lanthanide compositions, with the exception of its generous 0.2% content of europium.

So we have very similar ore in both places. Looks like mostly just Sovereign Risk, taxes, and labor costs keeping Molycorp in check. I expect China will find it acceptable to have a small competitor hanging on with small contracts, and will not drop prices to predatory levels nor flood the market with production; but that risk exists. The history of Molycorp shows it was consumed by an oil company, kicked around as a subsidiary, and was since spun out (though perhaps minus some lubricant / moly-grease parts…)

I’d also expect that the Sovereign Risk from California will be kept in check by the US Military concerns…

In Conclusion

This is an example of how you take a news story (China embargoing Japan on Rare Earths) and working through the background find an investment thesis and a target stock. Still not in this example is looking at the actual financial background of the company, sales, etc. So I’d buy a ‘tiny’ as a reminder or toy, but not a large position without a bit more homework on the stock. And some investigation of other competitors in the world.

UPDATE

Ran into this little Canadian / Wyoming start up stage mine. Having a bit of a parabolic run at the moment. Dangerous right now, but after it drops back some might be interesting. Looks like a couple of years before it will be actually mining anything, so for now it’s a ‘story stock’.

REE Rare Element Resources

REE Rare Element Resources

About the property

This article does a pretty good job of running down the uses and status of mining as of late 2008:

http://seekingalpha.com/article/103972-rare-earth-metals-not-so-rare-but-valuable

OK, here is a chart of a bunch of non-Chinese tickers from around the world that mine R.E.E. and / or process them.

Various Rare Earth miners and comparison to SPY and BHP

Various Rare Earth miners and comparison to SPY and BHP

SPY    -  S&P 500 baseline ETF
BHP    -  BHP a broad spectrum miner baseline
REE    -  Rare Element Resources (Canada with Wyoming property)
AU:LYC  -  Lynas Corp, Australia
ARAFF   -  Arafura Resources (pink sheets USA, Australia AU:ARU)
SHWDF   -  Showa Denko (Japan: interested in refining and 'stable supplier')
AU:ALK  -  Alkane Resources ( Australia)

China Rare Earth miners and processors:

Chinese Rare Earth Miners and Related with SPY baseline

Chinese Rare Earth Miners and Related with SPY baseline

CN:600111  -  Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-Tech Co Ltd
SPY        -  S&P 500 baseline
CREQF      -  China Rare Earth Holdings Ltd
ACH        -  Aluminum Corporation of China Ltd
NEMFF      -  Neo Material Technologies Inc.

Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Co Ltd is the worlds largest miner of rare earth minerals at present.

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About E.M.Smith

A technical managerial sort interested in things from Stonehenge to computer science. My present "hot buttons' are the mythology of Climate Change and ancient metrology; but things change...
This entry was posted in Earth Sciences, Economics, Trading, and Money, Political Current Events and tagged , , . Bookmark the permalink.

23 Responses to Are Rare Earths Rare?

  1. Nick says:

    Could China cut off supply? Yes

    Could the USA stop paying interest on its debts to China? Yes

    The USA and China are in the same bed together, sink or swim

  2. E.M.Smith says:

    But China is rapidly turning their bond holdings into ownership of things like oil and coal, while we are doing nothing much…

    And China is quite willing to take pain itself to “discipline” a “partner”…

    Don’t expect mutual interests to prevent them from using tactical advantage.

    Heck, look at “Chicken Feet”. Every time we find them putting toxic crap in something and stop the imports while we sort it out, they GASP! find salmonella on chicken feet and ban imports. As though we cared. (It’s going to be impossible not to have salmonella on chicken feet, given that chickens shit on them…). So we just send them to the cat food factory like we used to… But China keeps on cutting off their purchases of this “delicacy”, and only hurting their own people.

  3. Mooloo says:

    The cheaper option is to start to open a mine, then when China drops its price, buy up all the product like crazy to establish a strategic reserve.

    Even the Chinese cannot continue to sell it at a loss if the West is prepared to keep buying to get a couple of year’s reserve.

    The material has a storage cost of nearly zero and doesn’t go off.

  4. dearieme says:

    Are rare earths like chicken livers?

    P.S. If you can’t get chicken livers, how on earth do you make your bolognese sauce?

  5. Chuckles says:

    My original ‘off the cuff’ response was that it was simply China moving to the export of high value, value add, rare earth finished products rather than the refined raw materials?

  6. Tom Bakewell says:

    Sir this is quite an interesting post. You do your education a great credit. In late 60′s I drove by the Mountain Pass mine every day while on a summer job prospecting for ASARCO. Thanks again.

    Tom Bakewell

  7. E.M.Smith says:

    @Mooloo: I’ve seen indications that that is the approach used by China. They buy a lot of resources, the price spikes, then they suddenly stop for a month or three. Price crashes, then they are back in. I’d expect they buy a bunch of “puts” just before they stop buying product too… AND I’d bet they buy businesses ‘in the industry’ just after the price crashes.

    Remember: THEY have no US Anti-trust law saying they can not do that nor manipulate prices…

    Dearieme: Amercans rarely make ‘sauces’. Most Americans think sauce comes from a bottle ( A-1, BBQ, Ketchup, Soysauce, …) or put butter on it… Even “white sauce” is lost on most of them (us?). I make gravy from scratch (even using roux sometimes for special gravies) and folks Ooohh and Aaahh over the fact I can make gravy… and have no clue what a ‘roo is unless it has a pouch and hops ;-) A sauce using chicken livers would be looked on about like Buttered Parsnips. Something you might read about in a an old novel from the 1700′s.

    But no, I don’t think rare earths are like chicken livers.

    Chuckles: I think you are in significant part correct. China is starting with getting a long term lock on the raw materials it needs, then moving up the value add food chain one step at a time as it can then assure preferential pricing to it’s industries (to the detriment of others) while claiming all the time that it’s just being a competitor. Mercantilist all the way. Then when you someday complain about their e-cars being a monopoly, they will tell you to go ahead and compete (but you will pay 50% more for all the motors, magnets, materials, et.al.) Of course, you can always go start over yourself, then, and in about 20 years with the full backing of a world power and subsidy the whole time you could match their price… Why we are being such idiots about this puzzles them as much as it puzzles me…

    FWIW, the’ve now put a tariff on imports of US Chickens (while increasing purchases of US Corn…). Moving down the other side of the chain. Take something you buy, move one step earlier in the process, repeat until dominant.

    @Tom Bakewell: Thank you! I owe it in large part to a Mr. McGuire in High School. Retired US Steel Chemist who was also a retired Lt. Colonel in the USAF. Tough as they come. Let NO self deception or error go unnoticed. You either had it right, or regretted it. I once made the mistake of asking him (after Chem class): “What is gasoline?”. What followed was a 6 week or so unplanned extracurricular activity as he handed me a “Chemical Rubber Book” and “reminded me” where the library was and said he expected my report in a couple of weeks…

    He taught you how to think first, then how to use it in Chemistry and Physics second. It was his class where you had to “solve the units first” then do the arithmetic. If you had the units wrong, you got zero. He also taught us the slide-rule and how to ‘think while you do it’ so you did not get decimal places out of place. That it was just an aid to the mental process that MUST happen behind it. (the process folks no longer have using calculators, where the waitress will happily tell you your dinner cost $2043 dollars and not notice the missing decimal point… $20.43

    And lord help you if you made an implicit assumption that was not warranted. He’s spot it, skewer it, and hold it up for the whole class to admire.

    I think it was his experiences in time of war (WWII) where such “bright ideas that are wrong” got people killed. We treated every problem with respect… and an error was not tolerated. No excuses, just take your pain.

    So “Thank you” for telling me that I’ve done right by Mr. McGuire. It was his ‘never assume’ that caused me to ask “Are rare earths rare?” and his “Library is down the hall on the left” that taught me to find answers on my own. (And his ‘grading style’ that makes me satisfied only with zero error – though I don’t always get it, I work for it.)

  8. Congrats! a deep analysis of the issue. However I can’t explain the following: If you, at the US won’t work anything, from rare earths to computers, out of what do you imagine you are going to live?..Of course there are and there will be a bunch of millionaires with facilities in China and everywhere, but what about the rest of you? They won’t graciously give you their money.
    Though you may become poets, philosophers, singers, economists or the like :-)

  9. E.M.Smith says:

    Adolfo, it’s called “going out of business”…

    We have people in charge who believe in ‘entitlements’. This extends to their view of businesses as well. So they think business has a lock on profit, so the government can just take it, and the business will go find more.

    The will not change this point of view until ALL industry is destroyed or gone (and maybe not even then).

    So the hope is that the US voter still has enough understanding to vote these leaches out of office. We’ll see. But “hope is not a strategy”… and history is full of democracy failing “once the public learn they may vote for themselves the largesse of the public purse.” (The Latin American history is loaded with repeated failures of this approach…)

    IMHO, the mind-set began in the 1970′s with ‘smog laws’ where the car companies said “We can’t do that” but the laws were passed anyway (and some very bright engineers figured out how to reduce smog after all.) So the mind-set was SET that companies are all lying about everything.

    From that it’s an easy ‘leap’ to simply demanding “more money and no unpleasant aspects from the facilities.”

    But you actually can’t make a “nice” steel mill or slaughter house or pig farm. And you actually can’t make ever more profit when faced with global competition.

    But we’re now glued into the saddle on those broken beliefs, and we’ll stay there until the powers that be are broken or the companies are destroyed. Then a new generation will start over and rebuild…

    So for now, investment dollars go to places with clue (to better preserve them) and we try to find a safe place to sit (and popcorn ;-) to watch the collapse. Disaster moves are among the best sellers… But this one will move slowly. About a 20 year run to go, IMHO. We’ve just had the first scene of the ‘star’ grabbing their stomach in pain, we still have all that “discover they are being poisoned”, the hospital scene, the children discovering that it’s the corrupt local politicians coveting their heritage that’s delivered the poison, and of course the cliff hanger ending…

    So much hangs on November and the Tea Party impact…

  10. E.M.Smith says:

    I’ve added a charts for the other producers.

  11. Larry Geiger says:

    Ah, the sand mines. I have heard of gold, platinum, silicone, zirconium, titanium, tungsten, and rare earth elements coming from our mines but I did not know about thorium. But the best thing about sand mines are the ponds! Crystal blue water surrounded by white sand. Best swimming holes around. Spent some hot summers cooling off in those ponds. Now I go to the dermatologist every six months :-)

  12. @E.M.Smith

    Ok, however it is impossible to keep on “pouring the empty into the void” while selling black holes instead of “stocks” at stock exchanges.
    That game, as the Ponzi schemes, were invented with the purpose of pumping the fruits of labor from honest workers to the pockets of “not working at all” speculators, but this “creatio ex-nihilo” usually ends always in war, where, also usually, those “magicians” are really bad treated, to say the least, however not the inventors of this “multi-dimensional economy” themselves (they are the first ones to run away-as it is happening now to China) but their close relatives and friends. Nevertheless those more than intelligent “kids” this time, I guess, have made the wrong choice: China, where no one knows (rather we do know) that those nice games are punished by cutting heads off, nicely of course, using a big sword.

  13. BTW, if looking for rare earths, these are to be found in the many residue ponds of mines and refineries, so a green enforced recycling would turn them cheaper. or free…..that is one of the tricky business behind “green policies”.

  14. E.M.Smith says:

    @Larry: I grew up swimming in ‘dredger ponds’, irrigation canals, and the river and possess the Redhead Gene. More 2nd degree sunburns than I care to think about. Yeah, dermatologist….

    @Adolfo: So now you know why I decided to become a “not working at all speculator” ;-) Looked the game over, said “Hey, I’m working for wages and that doesn’t win!” so changed sides…

    I’m too small a fish to be of interest to anyone, though.

    THE big issue I see for ‘rare earths’ is that they are not rare and come in a package along with a lot of other stuff. So, for example, the largest provider (that China / Mongolia mine) is mostly an iron mine. So what happens when folks decide to use Thorium? All those rare earths in monazite come along for free…

  15. Chuckles says:

    Adolfo, You raise a VERY important point there. Mine dumps and tailings dams often contain huge quantities of important minerals that are simply not the core business of the company, or not economic to extract at the time they were mined. And of course, extracting the desired mineral ups the concentration of everything else. Plus all the hard works been done, it’s conveniently sitting on the surface
    Uranium in the South African gold mining industry springs to mind. In some areas there, mine dump sand was used for road surfacing, and you can map the roads quite clearly with a raidometric survey…..

    An allied effect is seen in exploration. Geologists are quite specialised, and a base metals geologist could quite easily walk straight over a gold or diamnd deposit without realising it. Venetia mine is an example.

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  17. LarryOldtimer says:

    Used to be, along about 1960 or so, America mined and manufactured almost everything Americans needed. Were only importing platinum, as I best recall. The balance of payments was hugely in favor of the US, and “Manufactured in the US” meant the best. Now it means manufactured in another country, and at best assembled in the US..

    Now, we mine and manufacture almost nothing. It is easy to say, “We Can”, but we can’t and keep all of the eco-whacko laws and other worse than useless laws on the books.

    I have been around the block more than a couple of times, and have read a good deal of history. IMHO, the US is rapidly becoming the LATE great US of A, and I sincerely doubt that we can possibly recover from an economic standpoint. Labor laws, eco-whacko laws, protect this and that to the Nth degree, we have thoroughly screwed ourselves.

    And . . . few indeed actually want to work anymore. The MBAs, lawyers and the like run the American owned companies, and engineers have little if anything to say about anything. There once was a thing called “engineering economics”, but who even knows it now?

    History clearly demonstrates that the final move of a badly failed political system is almost always war on a grand scale. Our political system is at the point of complete collapse, the way I see it. War on a grand scale is almost inevitable for the US . . . and European nations.

    I am. BTW, a professional civil engineer, retired since 1996.

  18. P.G. Sharrow says:

    As long as there are Government policies to prevent the use of American resources and the straight jacketing of manufacturing there will be no creation of new wealth in this country. Paper chasers do not create wealth, they just corral it into piles that get smaller over time. Generally, people will always create more wealth than they consume. That is until the bureaucrats steal and restrict to the point that the people quit. Then everyone in the system starves. The smart ones stand aside and fulfill their own needs. pg

  19. E.M.Smith says:

    Oddly, that’s where I’m at. I walked away from a 6 figure salary as the burden of making it all ‘go’ was just too large (mostly the government paper side of it. Sales and production were easy.)

    Now I make “just the minimum” and hide the rest in tax advantaged accounts waiting for the fall to start over…

  20. Willis Eschenbach says:

    Damn, Chiefio, that was an awesome post. Definitely bookmarked.

    w.

  21. E.M.Smith says:

    @Willis: Glad you liked it!

    This is an example of what I do most every week. Something goes bump in the night and I start looking at it. The major news typically gets things wrong (often hyped for a juicy story) and you MUST work through to the reality to now how to trade things.

    Most of the time I don’t make a posting out of it (as most of the time it’s not very interesting … China embargoes American chicken feet, cats in America rejoice! ;-) But I may do more of these. I have to do the ‘homework’ for myself anyway, and it only adds an hour or two to make a posting out of it (and then I have it for future reference too…)

    But this really is what folks ought to be doing on any big news story that looks to have economic impacts prior to tossing money at the “story stocks”…

    That I just happen to be really really interested in Thorium and geology had nothing to do with making this a posting ;-)

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