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Trump administration will set price floors across range of industries, Bessent
157 sats \ 6 comments \ @Wumbo 15 Oct Politics_And_Law
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151 sats \ 0 replies \ @siggy47 15 Oct
WTF? Is he imitating Nixon now?
https://www.cato.org/commentary/remembering-nixons-wage-price-controls
This administration believes in nothing (except rug pulls).
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10 sats \ 3 replies \ @Cje95 15 Oct
It pains me to say something like this but the Federal Government has to pay a role in critical minerals right now. MP Materials previously known as Molycorp was forced to shut down and destroyed the entire domestic rare earths mining chain due to China's flooding of the market collapsing prices and then once they eliminated the other players China cranked up the prices.
I am not sure what the answer is to industry issues like this because when a country is willing to loose money for extended periods of time to drain the competition dry its not like the market can be depended on to fix this quickly. Now the US has opened up the first in the world permeant magnet manufacturing facility in Minnesota (thats what the rare earths are important for) and are building the refining and mining capabilities in the US to allow for future pure competition this isnt likely to be long term.
However, we do have to give the businesses and investors some sort of certainty and in the case of MP they have an ownership stake now. Others like the Lithium Americas move that was a loan that was restructured and has an exit plan in place already for the US government as milestones are achieved in the construction and production of the mine.
Unless someone has a better idea which I would love to here we are stuck. Like in the 70s when the US was crushed by the oil embargo because we became way to dependent on a foreign commodity that drove our economy.
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0 sats \ 2 replies \ @SimpleStacker 15 Oct
I guess the question is, how quickly can the domestic industry be spun up in the event of a need? Because the traditional answer to your dilemma would be that we should buy up all of China's below-market materials and stockpile them, then if they try to raise prices, spin up our own domestic industries to counter that.
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30 sats \ 1 reply \ @Cje95 15 Oct
Thats actually part of the whole MP move. China wont allow the US to suddenly speed up purchases they have a hell of a system that tracks minerals movements. Last week they sent letters to various countries and threatened them with restrictions, bans, etc. if they did not follow the instructions/terms that China was selling them the refined rare earths for.
There are a couple of other companies that are in the process of spinning up but except for invoking war powers NEPA (National Environment Policy Act) takes years to navigate to open a mine. Its faster for the US to leverage equity to prevent NEPA and other BS lawsuits that derail these projects and drive the costs up. Thacker Pass has been in the process of getting all of their permits for I want to say is closing in on a decade.... One of the permits was a 17 month review process and they were sued by Envios claiming the 17 month review was rushed.....
On average factoring in the litigation mines went from taking 2.5 years to open to over 6 and counting. Now envoking war powers would remove these permitting issues but thats not an actual solution but neither is the government taking equity to stop litigation. These are temp. fixes while hopefully permitting reform one day passes.
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0 sats \ 0 replies \ @SimpleStacker 15 Oct
Again, it boils down to frakin' permitting issues. Sometimes I think permitting is the root of so many of our problems. Housing and labor included (land use approvals, occupational licensing)
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31 sats \ 0 replies \ @SimpleStacker 15 Oct
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