Chaka’s Note: Today, we have a special guest essay from longtime PBRG friend Nomi Prins.
Nomi is a best-selling author, financial journalist, and former global investment banker. She reached the upper echelons of Wall Street before setting out to demystify the world of money.
Nomi recently spoke with over a dozen government insiders. And with record-low fuel reserves… and natural disasters pushing our energy grid to the brink… America is ready for a secretive energy tech known as “SMR.”
Tonight at 8 p.m. ET, Nomi will reveal a way to play this trend for just $2 – and she believes it could become the highest-returning stock of her career.
To find out more, RSVP for Nomi’s “Power Shift 2023” with one click.
Over 2,100%.
That’s the average gain that rare earth elements (REEs) as a group delivered during its last bull market.
Take a look at the chart below…
Between 2010 and 2011, Lanthanum and Cerium appreciated by 4,141% and 2,978%, respectively.
Junior rare earths mining stocks – smaller, exploration-type companies – did even better.
So, what happened there?
China.
In 2010, the country stopped exports of rare earths to Japan. This was due to a diplomatic incident involving a Chinese fishing trawler.
Long story short, the Chinese fishing boat collided with a Japanese coast guard patrol boat… so the Japanese arrested the fishing boat’s captain. The clash caused a major dispute between the two countries.
But it also sparked a mania in rare earths and related stocks that lasted for about a year.
So why am I telling you this now?
You may know that rare earth elements are used in everything from iPhones, electric vehicles (EVs), flat-screen TVs, and computers to sophisticated military equipment.
They are essential to modern life… much more so than they were back in 2010.
But here’s the problem: The rare earths market today is in a precarious situation.
You see, the current geopolitical conflict between the U.S. and China is threatening to unleash a bull market of epic proportions in rare earths… one that could overshadow the 2010-2011 bull run.
There’s a lot at play here. So today, I’ll shed light on some important recent developments in this space and show you what they mean for you and your money.
But first, if you haven’t saved your spot for my Power Shift 2023 strategy session… be sure to RSVP with one click right here.
Tonight at 8 p.m. ET, I’ll reveal how a new law is poised to unleash $4 trillion into a new energy subsector called “SMR.”
SMR could be the solution to America’s – and the world’s – energy problems. And only one firm has the federal license to produce this technology in America.
So during my special briefing, I’ll tell you all about how you can play this company for less than $2 a share.
Just go here to reserve your spot instantly, and I hope to see you then.
Now, back to the developments in the rare earths space…
China Is Back at It Again
Mark Twain once said that “history never repeats itself, but it does often rhyme.”
I was reminded of this recently when I saw headlines like this one…
China Contemplating Export Ban on Rare Earth Magnets
According to a report by Nikkei, China is considering an export ban on “certain rare-earth magnet technology.”
In other words, the Chinese government is going after high-performance rare earth magnets.
This is a huge deal. Here’s why…
Rare earth magnets have many military applications.
They go into cruise missiles, bombers, rockets, drones, and all sorts of other cutting-edge military equipment. The U.S. Javelin missiles and F-35 fighter jets are so packed with these magnets, they are almost bursting at the seams.
And China produces and processes roughly 70% of global rare earth supplies. Have a look…
Former Chinese leader Deng Xiaoping once said, “The Middle East has oil. China has rare earths.”
He was right.
China knows that the U.S. is wholly dependent on REEs for its most sophisticated military equipment.
And party bosses in Beijing have been wanting to hit the U.S. where it hurts for a while now.
For example, in February 2021, the Financial Times reported that the Chinese government had reached out to its rare earths industry.
Basically, it asked, “How much damage could we do to the U.S. military if we cut off rare earth exports? Could we cripple its production of new fighter jets?”
Also, China aims to use rare earths as a bargaining tool.
That’s because in the past year, the U.S. began to thwart China’s access to advanced semiconductor technology.
Through the CHIPS Act, the Biden administration moved to limit the export of U.S chip technology to China.
The U.S. also brought on key chip-making countries like Japan and the Netherlands to the export limits.
And China is already behind when it comes to advanced semiconductors. For instance, it imports almost all of the chips necessary for manufacturing electric vehicles.
So at this point, China choking off rare earth supplies isn’t a wild speculation. The country has done it before over trivial matters.
And if history is any guide, there’s a good chance China’s rare earths ban will happen again in the near future.
What This Means for Your Money
If China bans rare earths exports, it can lead to another mania in this market.
But investing in rare earths is not easy.
The list of quality companies mining rare earths is small. Plus, most companies that produce a meaningful amount are listed in China. So they’re difficult for everyday investors to access.
But there’s another way to take advantage of this opportunity.
The VanEck Vectors Rare Earth/Strategic Metals ETF (REMX) is a straightforward rare earths investment you can access with a regular brokerage account.
This exchange-traded fund (ETF) gives you broad exposure to the rare earths industry. It holds companies involved in producing, refining, and recycling rare earth and strategic metals and minerals.
Now, it’s true that the fund holds quite a few China-based companies. That’s because it accurately reflects the current state of rare earth minerals as the world produces them today.
But as more countries start taking action to fight China’s dominance in the rare earths space, we can expect to see China’s percentage of REMX shift.
Regards,
 |
Nomi Prins
Editor, Inside Wall Street with Nomi Prins
P.S. Right now, America is dependent on other countries for important imports. But the energy law I mentioned earlier will help the U.S. take back its energy independence…
Thanks to Bill S.1111, “SMR” fuel tech could be the solution to our energy problems. And with a more secure supply of energy, America will be more powerful on the global stage.
Best of all, SMR is poised to deliver up to 20x profits for early investors. But if you don’t position yourself before May 12, it could be too late.
That’s why I’m sharing the full story at a strategy session I’m holding tonight at 8 p.m. ET.
During the event, I’ll show you why SMR is finally being released into the commercial sector, after being under government wraps for 68 years. I’ll also share details on the tiny firm with a virtual monopoly in this sector – and how you can play it for $2 a share.
So reserve your spot with one click right here, and I hope to see you then.