suitsurfer
It seems we are all here for similar reasons. Up until March or so of this year, I was a 13 year-long hauler of LYC. I, too, like this investment space, and I hope one day to return.
But, I felt my cash was put to better use playing the momentum of AI by buying heavily into Arm, PLC., which was an amazing move for me. Eventually, some of those gains will come back home to LYC, but not exactly yet.
Thank you for all your efforts in creating your modeling for everyone on the board. Fresh and well thought out analysis is always a great addition to the board. Over the years, we have enjoyed great insight from many people. Some still here, and others who sadly have left us.
The issue of tarrifs will be more difficult in the future. The West would be trying to protect an almost completely different product archetype vs. Chinese EV car offerings. Although most Chinese auto makers offer high-end options in their EV production, it is hard to impose a tariff on a smaller "mini cooper" esque type vehicle vs. a Tesla pick-up truck. I understand this is a extreme comparison, but the threat is very real, as (at least the Chinese have figured out) that economy in size and cost, coupled with EV technologies are a winning combination. While we in the West continue to take our classic models and simply exchange a gas burning engine (ICE) with an EV battery. I mean, isn't "Bandaid Style Production" the very problem that has brought Boeing to its knees. Not to mention that a 25% tarrif on a $13,000 Chinese export is still a great deal vs. $130,000 for one of Elons' obscene Mars rovers...
The Chinese RE issues and LYC are simple. The Chinese government can artificially keep the prices of RE low by increasing production of its oxides, which acts as a subsidy to help Chinese auto makers. RE are strategic metals. Chinese could never be held to account for EV car dumping by the overproduction of a strategic resource. Though in effect, that is exactly what they are doing. Will continue to do and why I sold LYC, knowing that low RE prices are with us for the foreseeable future.
Briefly, as for Taiwan, Xi can not afford to see his country slide into the abyss, as Putin has done to Russia. Not to mention that the Yuan is monopoly money if countries refuse to trade against it. Russia has oil that they sell to India and China (and now most likely North Korea) at 30% coupon to the official OPEC price. China does not have that same luxury, and it can hardly afford the hint of inflation while still dealing with their real estate debacle. Otherwise, you would have seen quantitative easing, which they simply can't allow to foster price increases. Actually, deflation is helping their consumer more than inflation would. So, for now, even though the world keeps moving further to the extreme right and into a very dark place, Taiwan will remain off-limits to the mainland.
I will look out for your future posts.
GLTA
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