u/CHRIST777777777777

Re the comment on the earnings thread wanting a warrant extension.

They're struck at $11.50, we're at 4.55, they die 9 Sept. That's +150% in four weeks. IV on the common is running about 100%, so four-week sigma is roughly 28%, and 4.55 to 11.50 is about three of those. Back of an envelope, so pick holes in it, but it's not happening.

Which means they've got no delta left. Functionally already expired.

If they expire, about 30m shares of dilution overhang comes off the cap table for nothing. If they're extended, we keep carrying it. That's good for the company and bad for us.

(Went looking for a gamma wall around that date while I was in there. Sept open interest is about 1,600 contracts on the 6 strike. There's nothing there.)

Am I missing a reason an extension actually helps common holders? Genuinely asking, because I keep seeing people hope for one.

I watched the whole thing so you don't have to. Two hours. I'm not okay.

Here's what happened.

The first forty minutes were people thanking Trump for existing. Then Trump thanked people for thanking him. Somewhere in there a man from the Colorado School of Mines got the biggest cheque of the day.

That cheque, by the way, is the actual news. $180m in grants plus $100m a year for mining education. Which is genuinely good policy, addresses a real skills crisis, and will start producing qualified mining engineers in roughly 2030. Absolutely nothing to do with why anyone in this sub was watching, but there we are.

The rest of the money went to a silicon anode battery company in Washington state, a copper project in Arizona, some graphite in Alabama, and Niron Magnetics.

Niron is worth pausing on. They make iron nitride magnets. The selling point of iron nitride magnets is that they don't need rare earths. So at a critical minerals event, at which the President said the words "it's all about magnets," the magnet money went to the company whose entire pitch is not needing the minerals. I'm sure this is fine.

No price floor. No Section 232 rate. No equity stake in anyone. No offtake. Lutnick, whose department contains NOAA, said nothing about NOAA. The deep sea executive order got mentioned in the past tense, which is a fun way of announcing something from April last year.

Now. The nodule.

Someone did hand Trump a polymetallic nodule cast in solid gold, on camera, and the chat lost its mind. That someone was Tom Albanese. Tom Albanese is the former CEO of Rio Tinto and is currently chairman of American Ocean Minerals, who merged with Odyssey Marine earlier this year.

So the deep sea moment at the White House belonged to the competition, delivered by a man with a considerably longer CV than anyone we've got.

I've been going back and forth on whether that's bad. I don't think it is, entirely. First time the category has had that kind of airtime, and it's harder to call something fringe after the President has held one up. Rising tide. But let's not pretend it was our tide.

Also, and this is the bit I'd want to know: the top table was cabinet secretaries and university heads. Industry was sat in an audience of about 200. So "summoned to high stakes meeting with Trump" means our lot had a chair in a conference hall, same as everyone else in there.

Positive note to close on, because there is one. The whole thing was framed as jobs. American mining, American jobs, Minnesotans want to mine not make chips, and so on. That reads as election-year fluff and probably is. But jobs programmes survive changes of government in a way that subsidies to specific companies really don't, and a Democrat House can't campaign against mining schools in Colorado. So the boring version might be the one that's still standing in 2028.

Anyway. We closed up 9% on a day when nothing happened, which tells you something, though I'm not sure what.

Not advice. I watched two hours of a man being praised and now I have to lie down.

Was poking around Anduril's careers page for unrelated reasons and found something I haven't seen mentioned anywhere.

They're building a critical minerals desk. Not one hire, a structure. There's a Senior and a Staff role for rare earth magnets, and Principal, Staff and Senior roles for germanium, plus a general critical minerals one. All Costa Mesa, posted late July. They're on the public Greenhouse board if you want to look, job-boards.greenhouse.io/andurilindustries.

Two things jumped out reading the actual spec.

The first is the mineral list. The role is described as being the single threaded leader for a designated mineral, and it names rare earth magnets, germanium, tungsten, antimony and gallium. That is more or less China's export control ladder in order. Gallium, germanium and antimony were banned to the US in December 2024, tungsten in early 2025, rare earth magnets in the April 2025 wave. A private company has organised its procurement org around MOFCOM's notices.

The second is a phrase in the responsibilities. It says negotiate offtakes and capacity reservations. Capacity reservation is the instrument you use with a producer who isn't producing yet, and it's the thing people keep saying can't happen before a project is built. Apparently it can, and someone is hiring specifically to do it.

Worth pairing with the Reuters piece last week where Lockheed is negotiating germanium supply with Teck and 5N Plus, both over a year in and still stuck on price and contract length. Two primes converging on germanium, and germanium is staffed harder at Anduril than magnets are.

The caveats, and they matter. Anduril is private so you can't own it, it only counts if they sign someone public. Their stated strategy is that around 90% of their products use commercially available components and they explicitly try to avoid defence specific chokepoints, which argues against them doing a big bespoke offtake. And hiring a buyer is not the same as buying anything. Lockheed's germanium talks show these take years.

But job postings tend to run six to eighteen months ahead of press releases, because you hire the person before you sign the deal. And they were live when I checked this afternoon, so it costs nothing to verify.

Not a recommendation, just something I thought was odd enough to share.

I know this is a bit of a double up - but look - Rio fucking Tinto, BHP and TMC are in the same meeting MP and USAR too - that's strong signal ...

Nobody seems to have picked up what China did on the 5th, and the more I looked at it the more relevant it seemed here.

MOFCOM tightened export controls on drones, key components and the underlying technology going to the US. Case-by-case review now, and they pulled the licence facilitation that made it routine. Sanctioned six or seven US entities while they were at it, and opened their first national security investigation under the Foreign Trade Law. It was a response to the FCC banning Chinese drone imports and DHS adding 43 companies to the forced labour list. Beijing called its own move "generally restrained," which I read as calibrated rather than soft.

The interesting bit isn't the drones themselves, it's what it forces. If you can't buy Chinese airframes or Chinese components, you build the platform at home. And a platform is three things: magnets, chips and batteries.

I'd been assuming drones were too small to matter for metals demand, and for quadcopters that's probably right. A hobby-sized battery is a couple of kWh against sixty odd for a car. But that's the wrong aircraft to be thinking about.

Anduril unveiled Thunder at Farnborough three weeks ago, built with Archer Aviation. Group 5, which is the heaviest UAV class, tiltrotor, hybrid electric, apparently carrying ten missiles. Archer's civil aircraft runs twelve electric motors. You don't lift something that size on hobby parts, so the motors are big and permanent magnet heavy, and the hybrid system needs a real battery. That's not a drone in the way people mean it, it's electric aviation with weapons bolted on, and the bill of materials is completely different.

MP announced something called Project Swarm the same week, which is them trying to aggregate drone industry demand and standardise the magnet specs. Thunder is exactly the kind of programme that makes that worth doing.

The underwater side is where it gets more interesting for this sub. Endurance underwater is purely a battery problem, no refuelling, no solar, and the packs run into the hundreds of kWh. Anduril has around forty maritime and undersea roles open at Quincy and Quonset Point, which is submarine building country. Their Dive-LD is rated to 6,000 metres, which is the same water column as the nodule fields.

I'm not drawing a line between them, there isn't one, and anyone claiming otherwise is reaching. But two outfits building industrial capability at four to six thousand metres is worth having in the back of your head.

One thing I had wrong until I checked. I'd been telling myself nickel wasn't really a chokepoint because Canada and Australia produce it. Chinese firms control something like 75% of Indonesian processing capacity, over sixty billion invested, and Indonesian supply has more or less finished off the Australian industry. Production there has gone from over 150,000 tonnes to around 60,000. BHP's Nickel West is on care and maintenance until at least February. Ravensthorpe, Kambalda, Savannah and Avebury are all shut. Prices down about 70% from the 2022 peak.

So it isn't that nickel lacks a chokepoint. It's the same playbook they ran on rare earths, flood the market and bankrupt the alternatives, and it already worked once. Which is exactly why Mountain Pass needed a government price floor to exist the second time round.

Where this is thin, and I'd rather say it than have it pointed out: it's a demand argument, not a scarcity one, and none of it shortens a permit timeline by a single day. But I hadn't seen anyone connect the drone controls to the battery side at all, so thought it was worth writing up.

Long, obviously, so weigh it accordingly.

After WW2 the US grabbed von Braun and 1,600 German scientists and got the Saturn V. In 1955 it deported Qian Xuesen in the red scare and he went home and built China's missile program. Two personnel decisions, two space programs. Nobody drew a supply curve for either.

Same game is running right now in rare earths.

The bottleneck isn't ore and it isn't equipment. Separation kit is tanks, pumps, kerosene and acid, all buyable. But rare earths are chemically near identical, so you need up to a thousand extraction stages chained together, and the train responds to any adjustment weeks later. The operating recipes are forty years of tacit knowledge living in people's heads, mostly in Baotou and Ganzhou. Less like building a factory, more like learning an instrument.

The receipts that this is the real battlefield:

China banned exporting the know-how itself in December 2023. Not the metals, the technology. You don't fence knowledge unless knowledge is the moat.

The first big lawsuit of the western rebuild (MP vs USA Rare Earth) is about formulations that allegedly left in one engineer's head. Industries tell you what's scarce by what they sue over.

And the hiring has started, with names. USA Rare Earth just signed definitive agreements for an equity stake in Carester, the French firm founded by Frederic Carencotte whose team markets two and a half centuries of combined separation experience, the old French school that never died. Their Oklahoma magnet plant already runs on old Hitachi Metals equipment, the Japanese school of Sagawa, who co-invented these magnets. One company collecting know-how from three continents and no analyst note frames it that way. Elsewhere, Germany's Vacuumschmelze is moving magnet people into a DoD funded South Carolina plant, and Purdue licensed Prof Linda Wang's chromatography process to ReElement, the bypass route that skips the Chinese recipe book entirely.

So the tell might not be capex announcements, it could be job boards. Separation engineers with Chinese industry backgrounds appearing at western producers. Neo Performance alumni moving (the one western firm that ran plants inside China for decades). Any talk of a critical minerals talent visa. And the failure mode to fear: treat every Chinese born chemist as a spy and you repeat Qian Xuesen, staffing Beijing's moat instead of your own.

Caveats: lawsuit is allegations, the framing is my synthesis, and the chromatography route still has to prove it scales.

Long a couple of names here, bias noted.

Been going down a rabbit hole on where all the seabed licenses actually sit and ended up making a diagram because I couldn't hold it in my head anymore.

Couple of things I checked against the ISA's own contract roster before drawing, because I had one of them wrong myself at first: China has two blocks in the CCZ (COMRA, plus the Minmetals block which is the biggest single one out there at about 72,700 km2). Their third nodule license, Beijing Pioneer at roughly 74,000 km2, is not in the CCZ at all. It's in the western Pacific, out near the second island chain. Which means they hold licensed water on both sides of Guam: around the island chains to the west of it, and to the east sitting under the shipping lanes that run from Panama and the west coast out toward it.

The bit that reframed it for me: a mining license lets a state owned "research" ship park legally for years in water where a grey hull would be an incident. There was AIS tracking work by Mongabay and CNN showing the Chinese research fleet spending most of its time outside its license areas in strategically interesting spots, including one ship running survey lines off east Taiwan. You don't need a stealthy sub if you're allowed to just park there.

And here's the thing about the US position. It can't kick anyone out of an ISA block because it isn't an ISA member, and it can't get ISA blocks for the same reason (Lockheed had to hold theirs through a UK subsidiary for years). So the only move available is mining under its own law, DSHMRA, which is exactly what the TMC permit is. That, plus Lockheed's two dormant licenses from 1984 that have been renewed for forty years without a single day at sea, is the entire US side of the board.

So I've stopped reading the NOAA timeline as boring paperwork. If presence is the game, the permit is the answer to those blocks, and speed matters.

Caveats since I drew it myself: block positions are schematic (the licenses are real and checked against the ISA registry, the exact coordinates in the drawing aren't), distances are compressed, and the halos are illustrative, not sensor ranges. Happy to be corrected on any of it.

Long TMC, obviously.

https://preview.redd.it/ip4bk4aqb1hh1.png?width=2551&format=png&auto=webp&s=2b5a3db07ec1a6ec5c945290759c018af682a05c

Spent way too long on this over the weekend but wanted to share because I kept seeing "China depends on Myanmar for heavy rare earths" repeated everywhere without anyone actually posting numbers.

So I went and pulled China's import data from UN Comtrade (it mirrors Chinese customs). Took a while to find the right code, the rare earth compounds Myanmar ships mostly move under HS 284690. If anyone knows a better series I'd genuinely like to hear it.

What the data shows:

2023: China imported about 72,000 tonnes of RE compounds from Myanmar, worth $1.44bn. Global Witness reckons that was ~98% of China's heavy rare earth oxide imports that year.

2024: 44,000 tonnes, down 38%.

And the monthly numbers show exactly why. Through spring 2024 it was running at 5,500-6,200 tonnes a month. Then the KIA (Kachin rebels) took the mining area around Panwa in October. October dropped to 2,800t, November 1,200t, December 726 tonnes. That's a near 90% collapse in three months. China only got it flowing again by negotiating with the rebels and paying what's reported as a ~$4,800/tonne tax to them. Even then 2025 volumes look like roughly half the 2023 peak, and USGS has Myanmar production falling from 27kt to 22kt.

The bit that changed my thinking: everyone worries about the scenario where there's a US-China deal and China floods the market and kills the western producers. For dysprosium and terbium specifically I don't see how they can. Their own heavy feedstock comes through a civil war zone they don't control, their domestic ionic clay deposits are largely mined out, and their own EV/defence/robotics demand is eating what they do get. You can't dump what you're rationing. Flooding is a real threat for NdPr and finished magnets where they have slack, but not for heavies.

Which also means any Kachin flare up, border closure or tax dispute is effectively a supply shock for the one input nobody outside China can replace yet. Interesting setup for whoever actually gets western heavy RE separation running.

Caveats since I'm not a trade data guy: 284690 is gross compound weight not REO content, it lumps heavy and light compounds together, and Comtrade lags Chinese monthly data by the better part of a year so the recent picture is from press reports of the monthly GAC releases, not the database.

Disclosure: long USAR and MP so read with that bias in mind. Happy to be told I've misread the data.

Everyone in here is stuck between two camps: "we're all going to be rich" and "even the funded names are crashing, it's over." Both are wrong, because both skip the actual mechanics. So here's the whole thing — the case and the catch.

It's real, and it's not optional. You cannot build a military to fight China that runs on Chinese magnets — the first move China makes in that fight is cut them off. That one dependency has to break. It's not a spreadsheet thesis; it's strategic necessity, and it's durable because the people driving it think in civilisational terms, not quarterly returns. But "has to happen" is not "happens fast," or "happens for your ticker."

The catalysts so far are promises, not cash. Permits progressing, funding "committed," MOUs, price floors — they're IOUs, and the market stopped paying for IOUs. So good news lands, everyone cheers, and it drops anyway. What actually re-rates one of these is a promise turning into revenue. Money in the door. Not another headline.

There's no shortage of money — and it still won't come. JPMorgan's pointed $1.5tn at this. Capital was never the problem; the problem is the projects don't pencil — China can crash the price the day you open. Government can fix that by de-risking (a floor, an offtake, equity — what MP got). But here's the catch running underneath everything:

The US can't be China. China's state just builds — it never has to please private capital. The US must pull private money in. But the very thing that makes a project bankable — the government prop — caps the unbounded upside private capital came for. So the prop attracts the bounded money (lenders against a floor) and repels the unbounded money (the buyers who actually bid a stock up). That's why MP is down despite the deal. The rescue that saved the business killed the convexity. Safe and boring doesn't get bought in a market paying up for unbounded AI.

And be precise — these are not one trade. MP is a producer, with real revenue and a floor paying cash; its stock's problem is a deflated premium, not a lack of buyers. TMC is the extreme opposite — pre-revenue, ESG-toxic, ex-SPAC, no institutional bid at all. USAR sits between — funded, but still pre-revenue. "Funded survivor" means something different for each, and lumping them together is how people take the wrong lesson from the same red day.

At the TMC end, there are no natural buyers at all. The institutions that'd normally set the price are barred — ESG screens (deep-sea especially), pre-revenue rules, too small, not in the index, ex-SPAC. Not because they evaluated it and passed — because they can't own it. So the price gets set by capitulating retail. It's cheap because the buyers are handcuffed, not because the smart money rejected it. (And yes — the ESG bar is hypocritical, AI's far more destructive — but it's real regardless.)

The timing isn't yours. It's China's. Strip it all back and you're holding a call option on China weaponising the dependency. China won't be a polite bridge to its own encirclement — it holds the leverage until it's most valuable to swing, and when it swings is unknowable. Run all the monte carlos you like; you still won't know. And it cuts both ways — an actual kinetic blow-up crashes everything first.

So the honest whole: a real, necessary thesis, with its upside suppressed by its own rescue mechanism, priced by handcuffed sellers, profit years off, and a catalyst only China controls and nobody can time. That's not a back-up-the-truck call. It's also not an it's-over call. It's an asymmetric option you cannot time.

Which leaves the only thing that matters: the edge was never knowing when it pays. It's owning the funded survivors, sized so the wait can't ruin you and the drawdown can't force you out — because the whole game is being there when it converts. If you're concentrated enough that a red afternoon feels like the end of the world, you're not positioned for this. You're positioned to get shaken out right before the thing you've waited for.

Watch conversions, not headlines. Stop trading the promises. Survive to the delivery.