Hi @GCar
One last post before I probably get banned or whatever...
You're making some great posts @GCar.
I appreciate that you have more time than I do to reply to people and provide data to back up what you say.
Don't let SpongeBob get to you. He is not half the researcher that you are.
In the post you're replying to here I think @Thesi is probably lumping EVs and lithium in under the banner of New Technology
and saying that we are in a recession so questioning whether the old
Last In, First Out rule would apply.
It's also probably what is on a lot of peoples' minds right now.
I think you’re reading it as “alternative technology” - ie the tech that they are testing at SDV at the moment.
And fair enough were your comments about Galaxy’s alt tech.
I would hope for an earlier report back from Simon Hay as he should have finished his own strategic review of all assets by now.
Perhaps next week we get some insight from the boss?
I think @Thesi may be a bit too quick and eager to assume that we are in a recession.
It's not technically true.
It was a very technical signal that the market flashed. And as accurate as it has been in predicting future events, it is also not an immediate signal.
It is like Leo has entered the sun system of Gemini or something. We wait for more planetary alignments than simple bond yield inversion.
We are in a very volatile period caused mostly by a US-China trade war. But even that has been going on for how long now..
Is it getting worse? probably. Is there a solution. Yes. As soon as China can design something that saves face for the US president, and makes diddly squat difference to them.
The trade war, and the utter petulance surrounding it, has sent some distorted signals to the market.
We aren’t used to this kind of leadership from the US.
But what has changed? Specifically for Galaxy?
Pretty much nothing.
@Thesi himself said he bought shares the week before and nothing has changed since except the market has dipped.
US Lithium stocks went up on Friday as a group. Buy good stocks when they're cheap still applies, every day of the week.
Even A40 may be a mixed bag for Galaxy.
On one hand potentially losing $20m. Youch.
On the other hand perhaps it's an opportunity to buy stockpile, plant or the entire company cheap, perhaps its removal of competition at precisely the right time to improve prices.
I'd like to think that Galaxy won't ever make a dud call again or at least will think very carefully about this strategy of substantial holdings.
I can’t see any argument being made anywhere that China is slowing down its drive towards complete electrification of its energy and transport sectors. I've seen some fiddling around the edges.
ie Huayou has just withdrawn from potential cobalt investment in the DRC.
Perhaps some customer pressure being exerted about ethical supply chains after China has been tin-eared to human rights issues around child labour for a little too long.
Right now, China's battery industry has very little to do with the US (excluding Tesla)
and the US is only hurting themselves by taxing their own batteries and material inputs.
China's strategy to remove petrol from their economy and to reduce the lethal levels of pollution that they are experiencing, after a period of intense manufacturing and urbanisation, is not going to be put on hold.
No. China isn’t going to stop with EVs or batteries.
They want to dominate the world with this tech. They’ve already pretty much done it.
The US has been caught napping and it may cost them their empire.
A trade war makes Teslas more expensive if they’re made in Nevada.
But not if they’re made in Shanghai.
Or in Europe.
As for Galaxy.
I don’t understand the panic. The sp is likely again to rise as we hit the buy levels again.
The Dow futures have chilled.
We have contracts for shipments. We have clients who have increased capacity.
We have one of the lowest cost operations and mine management that know what they are doing.
We are making profit and will continue to do so well after almost all competitors are under water.
We have no debt and are in the position where our bank balance gives us options to grow in several directions. Or to keep ticking over the plant, wait out any low pricing period.
Nobody except Colin thinks Galaxy is a goner.
And even his theory means that it will 5 years to run out of cash.
As far as SDV goes I don’t think it really has anything to prove as far as quality goes, only how exactly Galaxy proceeds with the scenario of building it themselves, financed by Mt Cattlin and cash reserves.
It can be done but timing of all events would need to be very careful.
ie what exactly is the timeline? What long lead items are needed when to build the plant in a modular fashion?
Does all that link up with the expected forward receipts from Mt Cattlin?
How about JB? Where does that fit in the timeline?
One of the problems with going straight to ordering long lead items may be that if the alternative tech approach is working and offers the best solution, it may well mean that it is preferable to wait for comprehensive results before spending another valuable dollar.
And so the impatient market deems it a failure, even as it teeters on the edge of some potentially game-changing production method…
I don’t know as much as you do about brine, but from what I understand an alternative tech approach may need completely different equipment. It may not need dehydration ponds, as much as a few holding ponds. What they have dug and are getting lined may almost be sufficient as far as ponds go.
Even the traditional carbonate plant may not be absolutely necessary.
I don’t know. We are in the dark about what they’re testing.
The point I was making in a slightly distracted post above was that if you go ahead and apply the recession test to lithium then it is already ascendant and victorious in the energy sector.
There is no stepping back to coal stations now. I challenge anyone to find me any reasonable analyst who still believes the spin that renewables aren’t capable of base load.
That Solar (and other renewables wind etc) and batteries perform as a replacement for coal plants is already proven. Done. Coal is over. Tier one banks are refusing to finance it.
I don’t believe that the world is headed for an immediate GFC 2.0 but once you have a proven cheaper method then it doesn’t matter what the economic conditions are - if you’re hungry you have to eat.
If you need power stations - the solution now involved lithium batteries. Unless you want to pay more.
EVs are getting towards parity. BYD have a sub $9k USD 320km range car.
That’s it. That is the test case proved.
More safety and better software and that is your Suzuki Swift Killer.
The rest of us will want our Teslas. Shanghai built for a few bucks cheaper.
Say we are headed for a recession, if governments want to reach for stimulus tools then they are very likely to reach for something that has the double-edged capability of doing something good for the economy.
They’ll stimulate employment and efficiency.
The flawed insulation scheme here kept people in employment but mostly just slushed money around.
It may have had the secondary benefit of making Australians more willing to look at solar installs to save even more money.
China is already stimulating like crazy. That is what a 5 year plan is.
So that will continue to stimulate the new energy sector, get people spending on new Chinese made EVs.
Same with Europe. They have ICE sunset dates coming up. The German economy would love to see their auto industry transition more smoothly.
Australian stimulus - well it could be anything.
Labor was going to go home battery subsidy. Liberals could do worse than steal that one.
We are solar panel heavy and there is an immediate efficiency dividend that could lessen the load on the national grid.
That’s assuming that we head for the old quantitative easing method or that we indeed face any real headwinds.
What is absolutely true is that the world has undeniable and lethal pollution issues.
People want to eat, then they want to breathe. and in the reverse order too.
The next generation are even more militant on these issues than the last.
Interest rates are at record lows.
The stock market is the bowl of food.
The banks and hedge funds are the hungry dogs.
Try to keep them apart.
