time to short, page-32

OMG wrote: NOT ONCE did Julia mentioned Lynas will fall becasue of the European Crisis In fact it was I who told her time and time again the only downfall to Lynas is the Crisis.

A fair point omg.
But to be honest I do not think we fell just because of Europe. Nearly every rare earth stock around the globe was hit when REE prices began to fall and the short interest in all of the stocks started to build. Demand destruction has been bad for all of the stocks and has unfortunately put a lid on the current sector.

The real question for all going forward is: Will demand increase with increased supply? Conventional thought is that increased supply should hurt prices and then harm upcoming juniors.

But we did not see new supply cause the price drops. In stead, we saw classic demand destruction. REE uses slowed when prices went too high and supplies were insufficient without new production.

But rare earths are used in very new technologies. Curtis has said in prior investor calls that he thinks many new technologies will only emerge when there is a realiable rare earth supply chain to satisfy those needs (see Ivestor Call Feb 2011 on Lynas website). In other words "if they build it (the mines) then they'll come {the OEM (Original Equipment Manufacturers) users}." If we have seen demand destruction in the last few months then supplying the new supply chains should build and generate new end markets and actually increase demand.