Greg's Note: If you've been having trouble lately locating some rare and critical metals, you're not alone. Byron King explains why these metals are rare and how the scarcity adds to their investment potential. You don't have to be a geologist to understand that these rare metals can be pretty valuable. Enjoy, and send any comments to your managing editor here: greg@whiskeyandgunpowder.com Whiskey & Gunpowder
You've heard the good old story starting, "A guy walks into a bar," right? OK, here's my version of it: This guy walks into a supply house and goes up to the clerk behind the counter. He says, "Excuse me, but could I buy some lanthanum?" The clerk is busy smoking a cigarette. He looks the guy up and down and says, "We ain't got no lanthanum." So the guy says, "What? You don't have any lanthanum? OK, then how about some cerium? Or perhaps you could spare some yttrium? Do you have some cerium or yttrium that I can use?" The clerk looks at him and shakes his head. "Sorry, pal. Not in stock." ~~~~~~~~~~~~~Special~~~~~~~~~~~~~ Jumping to Huge Gains
Get on the next one right here… ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ The guy begins to look a bit desperate. He says, "No? Well then, do you have any europium? Or is there any neodymium? While you are at it, can you please check for praseodymium or samarium? I don't mean to trouble you, but do you have some gadolinium or dysprosium? And I need some terbium, holmium, erbium, thulium, ytterbium and lutetium." The clerk looks at him, shrugs and holds his cigarette out to flick some ash on the floor. "We're fresh out," says the clerk. "Listen," says the guy. "I hate to be a pest. But I can't take no for an answer. I have to have these products. Without them, my whole economy shuts down. I'll be ruined." The clerk looks at him and says, "Well, too bad for your economy. I guess you are just plain up the old creek, huh? Better grab a paddle." No Funny Punch Line to This Story Well, dear reader, are you waiting for the funny punch line? Sorry, but there is no funny punch line on this one. This is no joke. I said at the beginning that I would tell you a good old story, not a funny story. And the investment recommendation makes for a good story, or maybe even a great one. What were those strange-sounding things that the guy was requesting from the clerk? They are called "rare earths," and for good reason. They are some of the most valuable, critical metals on the face of this planet or any other. Demand is soaring, and supply is…well, supply is not. Meet the Lanthanides In this issue of Whiskey I'm looking at an investment opportunity in 15 elements from the periodic table. In formal scientific nomenclature, they are called the lanthanides. More commonly, they are called rare earths. None of these elements are famous like gold or sliver. None get shipped in giant ore freighters, like iron, aluminum or copper. You sure don't learn much about these 15 elements in high-school chemistry class, unless maybe it's the school that feeds lots of kids into MIT or Caltech. In fact, the only people who really study these elements are master's- and Ph.D.-level chemists and solid-state physicists. Oh, and national leaders in places like China. But without these elements, much of the modern economy will just plain shut down. "Just plain shut down? C'mon," you might say. ~~~~~~~~~~~~~Special~~~~~~~~~~~~~ Oil Soars Past $150 a Barrel Don't be surprised to wake up to this headline sooner than you think. While everyone is worrying about politics and our domestic concerns, don't forget about the troubles in the Middle East. International incidents could soon be sending oil much higher than we ever thought possible. Click here to see what's happening… ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ But yes, these elements are critical to the modern economy, and that is not hyperbole. We are addicted to rare earths as much as we are addicted to oil, except most people don't know about the rare earth addiction. But I am going to explain it to. Say Goodbye To TV Screens, Computer Hard Drives, GPS, and More… These 15 elements are strategic. These elements play a critical role in petrochemicals, environmental protection, "clean" technology, electronics, automotive applications, optics, telecommunications, computing and defense. They are indispensable to a myriad of intermediate and end uses. Really, without these 15 elements, you can say goodbye to much of modernity. There will be no more television screens and computer hard drives, fiber-optic cables, digital cameras and most medical imaging devices. You can say farewell to space launches and the satellites that do everything from show you the weather to offer global positioning down to a few inches. And the world's system for refining petroleum will break down, too. That's pretty serious. If you are curious about the details, I will discuss each of the 15 rare earth elements in greater detail at the end of this article. But this is not a technical paper on chemistry, no matter how interesting the subject might be from that angle. What Are These 15 Elements? These 15 elements are all metals, although usually one sees them in powdered form as oxides. They are called rare earths. But how rare are they? Well, they are scattered here and there in the Earth's crust. But you won't exactly trip over them as you stroll along the beach. It is quite rare to find these elements in deposits that are economic to mine. So that is the investment lure. Rare earths are usually found in rock bodies called carbonatites — for the most part non-geologists have never heard of them. And for our purposes today all we need to really know is that carbonatites are rare. Once you find a deposit of rare earth elements in a carbonatite, it is still very difficult to mine and mill the rocks and minerals. The processing chain is long and complex. So we are dealing with rare earths in rare rock bodies that are difficult to mine, mill, and process. Right now, almost all of the world's supply of rare earths comes from China, which is why our investment opportunity is so appropriate. Unfortunately, I cannot let you know the specific investment opportunity I'm talking about. That simply wouldn't be fair to the readers of my Energy and Scarcity newsletter. But now you at least know where to look. Until we meet again... P.S.: If you would like to know the 15 metals I'm talking about, as well as find out specific investment plays in these rare metals, you must be a subscriber to the Energy and Scarcity Investor. Click here to see what we're working on… |
Whiskey & Gunpowder Special Reports $1,000 Gold and Rising... 5 Entirely New Ways To Play the Gold Trend The 10 Shocking Reasons for China's Pollution Problem Geothermal Energy: Investment in the Future Here's One Coal Stock That's Set to Skyrocket Investing in Exchange Traded Funds The Real Story Behind the True Gold Bull Market If someone forwarded you this copy, please look here to start your own subscription. Wanna let us know what you thought of today's issue? Now you can... click on this link. Whiskey & Gunpowder is a free e-mail service brought to you by a team of rebellious brigands. If you have not already done so, please click here to confirm your subscription. This will help us ensure you get every Whiskey & Gunpowder without interruption. Are you having trouble receiving your Whiskey & Gunpowder? You can ensure its arrival in your mailbox here. Please note: we sent this e-mail to lemmetry@gmail.com because you subscribed to this service. To end your Whiskey & Gunpowder e-mail subscription, click here. Nothing in this e-mail should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice.We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation. Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. © 2008 Agora Financial, LLC. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the World Wide Web), in whole or in part, is strictly prohibited without the express written permission of Agora Financial, LLC. 808 Saint Paul Street, Baltimore MD 21202. |
