In November of 2014, China hosted the annual meeting of APEC in Beijing. As a mirage in showing themselves a responsible world citizen to environmental concerns, the government shut down factories and banned the burning of coal and wood. For many who frequently travel through Beijing, it was their first glimpse of the sky.
In 2017, China's auto industry accounted for the manufacturing of 680K all-electric vehicles; a number exceeding the RoW, combined.
LINKIntended consequences:
For China, it is three-fold:
1) There exists present, serious health risks from air pollution in China.
2) China is working toward an improved world image and jostling for leadership.
3) China believes they, with shared, mutual actions from other world industrial powers, will - in a benign way - erode the
value of the petrodollar. "For the good of all." Somebody forgot to lock the backdoor.
Cue gold's entry.
Toward markets, I'm apolitical.
My interest is in where the money flows, and the opportunities in manufacturing, technology and the foundational base to support the the e-vehicle industry.
The base is the power companies. My approach has been and is to invest in those regions which have a high saturation population. Early adaptors. Above the base is technology. Moving fast, and the market environment more volatile. At the top, consumer products, and even greater volatility.
Presently, I view it as a symmetrical pyramid. As the industry grows, the top and middle will stretch upward, and the base widen(and increase in value) to maintain stability. While volatility in the top two tiers will see names come and go, it is the base which will endure and prosper through it all.
Overcoming odds to support the end:
Over 60% of the world's present supply of cobalt comes the the Katanga mine, located in the Democratic Republic of the Congo. Add in lesser operations in third world/developing countries, and the number exceeds 70%. There will be and are
PROBLEMS. Last year, Glencore, parent company of the Katanga mine, spent $25M to reduce low-grade radiation and bring the operation into compliance with export standards. By revenue, Glencore is the largest mining company in the world, and currently being investigated by the DoJ.
Graphene & Stanene:
Thin film technology which will reduce battery charging time. There are environmental concerns with the production of both. Until technology resolves, investors are looking at graphite mines located in stable countries, such as Canada.
As the e-vehicle industry matures, the transfer of one energy source to another(the base) will have consequences which will directly impact American agriculture and the oil industry. Recognizing this, at least one - BP - has and is expanding into wind, solar and partnership with DuPont and Butamax for the production of butanol.
It's 1980
