🚨JUST IN: U.S. NEGOTIATING CREATION OF $5 BILLION FUND TO INVEST IN RARE EARTH MINERAL MINING ~ WATCHERGURU ...

JUST IN: 🇺🇸 US in talks to set up $5 billion fund to invest in rare earth mineral mining. ...

Geopolitical & Strategic Importance - Greenland's strategic location between Canada and Iceland, and its potential for mineral resources, are attracting attention [1][3] - China's dominance in rare earth mineral production raises national security concerns, intensifying interest in alternative sources like Greenland [2] - The Trump administration sees Greenland as having potential for fisheries, mineral resources, and hydroelectric power [3] Mineral Resources & Economic Potential - Tan Breeze in Greenland is considered a significant deposit of rare earth elements, including tantalum, niobium, and zirconium [1][2] - These rare earth elements are crucial for manufacturing automobiles, airplanes, defense technology, and wind turbines [2] - Developing Greenland's resources could create a robust commercial industry while addressing national security issues [4]

Industry Trend - U.S. becomes largest shareholder in MP Materials, a rare earth miner [1] - The move aims to counter China's dominance in the rare earth industry [1]

Geopolitical & Economic Strategy - African nations presented access to critical and rare earth minerals, essential for technological advancements like chips and semiconductors, in exchange for US investment [3] - Gabon sought autonomy in mineral processing to add value, grow their economy, and create jobs [4] - The discussed investment aimed to develop 8 to 10 gigawatts of electricity, potentially reducing incentives for young people to migrate to the US [5] - The US aims to reduce reliance on China, a major producer of rare earth minerals, who uses them for geopolitical leverage [6] - African countries are keeping their options open, being courted by China and the Middle East [10] Meeting Dynamics & Outcomes - African leaders appeared well-briefed, delivering a consistent message emphasizing investment opportunities and the importance of the US as an ally [1][2] - The meeting was perceived as a starting point, better than expected but not fully meeting the African leaders' hopes [7] - No definite agreements were reached during the meeting [9] - The US president hinted at potential tariff exemptions for these African countries [6]

US-Australia Relations & Strategic Alignment - The US-Australia alliance is considered vital by both nations, despite the absence of a meeting between President Trump and Anthony Albanese [4] - The relationship is too significant to fail, prompting discussions on friction points like tariffs and defense spending [5][6] - A non-public review of AUKUS (orcas) has been conducted by Australia, aligning with strategic objectives to enhance submarine capabilities and counter China's assertiveness [15][16] - The US may be leveraging AUKUS to encourage increased Australian defense expenditure [17] Trade & Security Concerns - Trade tensions and tariff uncertainties complicate strategic directives aimed at China [1][2] - Critical minerals cooperation is increasingly important for both security and trade, especially as China weaponizes access to rare earth minerals [6][7][8] - Australia and the US signed an agreement ~18 months ago to expand collaboration on clean energy, climate change, and critical minerals [7] - Australia aims to ensure a trusted supply chain for the US and allies [8] Pacific Engagement & Regional Influence - The US has increased engagement with the Pacific, but development assistance is under review, raising concerns about episodic engagement [9][10][11] - Australia is the largest bilateral provider of aid to the Pacific, prompting discussions about whether it should increase its contribution if the US reduces its engagement [13][14]

Investment Rating - The report does not explicitly provide an investment rating for the industry or specific companies covered Core Insights - The recent US-China trade agreement is viewed as a tactical pause rather than a comprehensive resolution, indicating ongoing tensions between the two nations [2][4] - The agreement addresses critical dependencies in technology and resources, with China relying on semiconductor imports and the US dependent on rare earth minerals [4] - Economic forecasts suggest US GDP growth of 1.0% in 2025 and 2026, while China's real GDP growth is expected to slow to 4.5% in 2025 [2][5] Summary by Sections US-China Trade Relations - The trade agreement is limited and does not resolve fundamental disagreements, with US tariffs on China imports remaining significantly higher than at the start of the year [4] - Both countries are attempting to reduce dependencies, but progress is slow, with China investing in its semiconductor industry and the US seeking alternative rare earth supplies [4] Economic Outlook - The report anticipates that tariffs will lead to a rise in goods prices, affecting inflation rates, with headline PCE expected to rise to 2.9% and core PCE to 3.3% in 2025 [2] - The US faces a weaker growth outlook due to higher tariffs, which may pressure the dollar and Treasury yields lower, while creating uncertainty about future inflation [6] Market Positioning - Investors are advised to position for slower growth and uncertainty in US-China relations, with potential opportunities in currency and Treasury markets [6] - The report suggests that the current economic environment may lead to a steeper yield curve as longer-maturity yields reflect inflation uncertainty [6]

Rare Earth Minerals Dependence and Geopolitical Risks - The US is heavily dependent on China for rare earth minerals, creating a strategic vulnerability [1][2] - China's control over rare earth mineral licenses poses a risk to US manufacturing and defense industries [3] - Trade war initiated without securing rare earth mineral supply chains was a strategic oversight [2] - Reliance on Chinese materials for military hardware, especially for defense of Taiwan, is a critical concern [3] Alternative Sourcing and Strategic Partnerships - Brazil possesses 21 million metric tons of rare earth mineral reserves, representing 1/5 of global reserves, which is 10 times more than the US [5] - Vietnam has significant rare earth reserves and an integrated supply chain, making it a potential partner [7] - Australia holds 2 million metric tons of high-quality rare earth reserves, presenting another sourcing opportunity [8] - Developing domestic rare earth projects, such as the New Mexican project, is crucial for long-term security [8] Policy Recommendations - Urgently establish deals with Brazil, potentially waiving the 10% reciprocal tariff, to secure rare earth mineral supply [6] - Negotiate with Vietnam to eliminate tariffs in exchange for co-development rights to their rare earth resources [7] - Initiate "Manhattan Project" style initiatives in Brazil and Australia to refine and process rare earth minerals [6][8]

(door slamming) (camera shutter clicking) (onlookers faintly speaking) (car engine rumbling) - We have reached a framework to implement the Geneva consensus and the call between the two presidents, right. So that was on June 5th. So we've combined those two.We've reached a framework for implementation. So the idea is we are going to go back and speak to President Trump and make sure he approves it. They're gonna go back and speak to President Xi and make sure he approves it.And if that is approved, we will ...

Market Trends & Global Economy - Asian stocks are rising despite tariff uncertainties, with healthcare and tech sectors performing well [11] - China's consumer prices are falling, confirming the fourth month of deflation, with exports to the U S falling by over 3% [12] - Trade policy uncertainty has dropped in recent weeks, influencing the U S equity market [23][24] - The S&P 500 entered a bull market, crossing 6000, boosted by better-than-expected jobs data [2][21] Trade & Geopolitics - U S and China are engaging in trade talks in London, aimed at diffusing tensions over Beijing's rare earth export restrictions [14][43] - The U S seeks to restore the flow of critical minerals for military systems, while China aims to ease tech restrictions [14][17] - Tensions are escalating in Los Angeles due to protests sparked by U S immigration raids, with President Trump and California's governor clashing over National Guard deployment [4] AI & Technology - The U K government is positioning AI at the heart of its growth agenda, with London Tech Week kicking off [1][28] - Meta is in talks to make a multi-billion dollar investment into AI start-up Scale AI, potentially exceeding $10 billion in value [49] - Luminous, an AI company, is changing the legal space with its AI platform, seeing a 40 times increase in usage [27][30] - Apple's developer conference will focus on software upgrades and AI, with potential for Siri to gain generative AI contextual awareness [80] Financial Markets & Investments - U S futures started the week in the red after entering a bull market, with the S&P 500 pointing lower by about 0 2% [21][42] - The two-year Treasury yield reached 4% for the first time in two months following stronger-than-expected jobs data [22] - The market is pricing in fewer Fed rate cuts, with expectations pushed back to October, pricing around 47 basis points [77][78]