Core Insights - American Battery Technology Co. will proceed with its over $2 billion lithium mine and refinery project in Nevada despite the cancellation of a US Department of Energy grant [1][2] - The company experienced a significant market value loss of over one-third following the announcement of the grant termination [1][4] - The CEO stated that the project completion is still targeted for late 2027, and the company has raised $52 million from public markets to cover costs previously expected to be funded by the grant [2][6] Industry Context - The grant termination coincides with an escalating trade war between the US and China, where batteries are a critical leverage point for China due to its mineral wealth [3] - The Trump administration has highlighted the importance of lithium and other elements essential for energy storage and electric vehicles [3] - China's recent increase in curbs on rare-earth exports has led to market volatility and a strong reaction from the Trump administration [3][4] Financial Impact - The grant, awarded in 2023, was intended to finance the design and construction of a plant for manufacturing battery-grade lithium [5] - As of the grant cancellation date, American Battery had $52 million in reimbursable funds remaining from a total of $58 million [6] - Following a 1,000% increase in share price over the past year, the company's stock plummeted more than 20% and 35% in the two sessions after the grant termination announcement [4]

Market Dynamics & Geopolitics - China is using the U_S_ stock market as a negotiation tactic in trade discussions with the U_S_, leveraging Trump's focus on market performance as a measure of his presidency's success [1] - Uncertainty created by delaying negotiations hurts markets, pressuring Trump to make deals that benefit both the U_S_ and China [1][2] - U_S_ midterm elections in April next year add pressure, as stock market performance influences voter sentiment and impacts Trump's strong economy narrative [2][3] Monetary Policy & Liquidity - The Federal Reserve is hinting at potential rate cuts of 25bps or even 50bps, and signaling the end of Quantitative Tightening (QT) [3] - The Treasury Secretary indicates readiness to take actions to stabilize the economy, implying increased liquidity [4] - Increased volatility is expected in the short term, followed by increased liquidity injections into the market [5] Crypto Market Analysis - Crypto assets are reacting to liquidity flows resulting from policy responses, not just tariffs or headlines [5] - Favorable conditions are emerging, including potential rate cuts, the end of QT, softening inflation data, and rising political pressure, similar to conditions preceding major rallies in 2019, 2020, and 2023 [5][6] - Crypto is now a recognized institutional asset class, integrated into the global liquidity narrative, potentially extending the current cycle beyond the typical November/December peak [6][7] - The current market volatility is viewed as a reset before the next phase of the bull market, driven by pressure leading to policy responses, liquidity injections, and subsequent expansion [7][8]

We'll turn to Washington now where the trade war with China is showing no signs of abating. Aean Jabber is with us now. So what's next, Aean.Yeah, Sarah. What we saw overnight is the Chinese side responding, defending their conduct and defending their man uh in comments to reporters there. The Chinese side saying that uh their conduct in terms of these rare earth materials has been fined and accused the US of stoking panic.And they also defended a lower level trade official who was singled out by Treasury S ...

Core Viewpoint - The U.S. and China are engaged in a dispute over China's recent export controls on rare earth minerals, with both sides accusing each other of creating panic and misunderstanding, while expressing a willingness to engage in trade talks to resolve the issue [2][3][5]. Group 1: China's Position - China claims its export restrictions on rare earths are necessary for national security, aimed at preventing misuse in military applications [6]. - The Ministry of Commerce criticized the U.S. for distorting China's measures and accused it of projecting its own behavior onto others [8]. - Rare earths are essential for U.S. military technology, including weapons platforms like the F-35 and Tomahawk missiles, as well as civilian applications such as electric vehicles and robotics [8]. Group 2: U.S. Response - The U.S. Trade Representative accused China of attempting to control global technology supply chains, with the potential for 100% tariffs on Chinese goods if the situation escalates [4]. - The Trump administration is working to establish a domestic supply chain for rare earths to reduce dependence on China, including a deal with MP Materials, the largest U.S. rare earth miner [9]. - Treasury Secretary Scott Bessent indicated that the administration may take equity stakes in other companies to ensure self-sufficiency and combat market manipulation by China [10][11].

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JUST IN: 🇨🇳🇺🇸 China wants to work with the U.S. to ease trade war tensions. https://t.co/8Oam9EZzkk ...

Valuation Concerns - The Shiller PE ratio of the S&P 500 is currently just under 40, indicating that investors are paying excessively for historical earnings [2][3] - Historical benchmarks show that when the Shiller PE exceeds 32, significant market downturns have followed, including the Great Depression, the Dot-Com Bubble, and the 2021-2022 correction [4][6][9] Historical Context - In September 1929, the Shiller PE reached approximately 32.6, leading to an S&P 500 decline of over 83% during the Great Depression [6] - The Shiller PE peaked at 44.19 in December 1999, resulting in a 49% decline in the S&P 500 from its high in March 2000 to its low in October 2002 [8] - The Shiller PE was around 38.6 in late 2021, with the S&P 500 falling 25% from its peak in January 2022 to its low in October 2022 [9] Current Market Implications - The current S&P 500 level of 6,671 suggests potential downside risks of 25-50%, with historical corrections indicating similar valuation levels [10][13] - Extreme valuations are compounded by various macroeconomic challenges, including persistent inflation, high interest rates, trade war uncertainties, and rising US debt [11][14] Investment Strategies - The Trefis High Quality Portfolio has outperformed its benchmark by generating returns exceeding 105% since inception, suggesting that diversified strategies may mitigate risks associated with high valuations [5][18] - The Trefis Reinforced Value (RV) Portfolio has also surpassed its all-cap stocks benchmark, indicating that a diversified approach can leverage favorable market conditions while limiting losses [18] Market Dynamics - The current market environment is characterized by a confluence of risks that could amplify one another, creating a "perfect storm" scenario for potential downturns [11][22] - Despite historical evidence indicating significant downside risk, markets have often defied expectations, raising questions about whether current valuations are justified or indicative of speculative excess [19][20]

Market Trends & Crypto Performance - Crypto majors experienced declines following Trump's trade war confirmation; Bitcoin decreased by 1% to $111,100, Ethereum decreased by 1% to $4,040, BNB decreased by 1% to $1,170, and SOL decreased by 4% to $195 [1] - Gold increased by 1% to $4,260 [1] - Memecoin leaders mostly declined; DOGE decreased by 2%, Shiba decreased by 2%, PEPE decreased by 4%, PENGU decreased by 4%, BONK decreased by 4%, TRUMP decreased by 3%, SPX decreased by 5%, and FARTCOIN decreased by 4% [3] Regulatory & Institutional Developments - Erebor Bank, backed by Palmer Luckey and Peter Thiel, secured a conditional federal bank charter, aiming to operate as a stablecoin-era crypto bank under the GENIUS framework [1] - Sony Bank applied for a national trust charter to issue USD stablecoins and offer custody services [1] - Kraken acquired Small Exchange for $100 million, gaining a license to offer derivatives trading in the US [1] - The UK moved to repay Chinese victims of a $7 billion Bitcoin fraud [1] Token & Protocol Updates - Launchcoin decreased by 23% to $78 million after Pasternak announced plans to increase the token supply by 33% to 133 billion and a flywheel to buy BELIEVE [3] - MegaETH opened registration for a public ICO, open for 12 days [3] - Jupiter announced changes for its JUP token including scaling down the DAO, dropping unstaking window from 30 days to 7 and voting to burn current JUP buyback [3] - Tether's USDT0 and XAUT0 launched on Solana, powered by LayerZero [3] NFT Market - OpenSea announced that its Wave 1 is locked and Treasure Chests claimable by Oct 17 with $122 million in prizes; Wave 2 runs Oct 15 - Nov 15 with $1 million in tokens added to prize pool [3] - Plush Pepe 7 sold for 25,000 TON ($55,250) on Portals marketplace in Telegram [3] Corporate Treasury & ETF Flows - Bitcoin ETFs experienced $1041 million in net outflows on Wednesday; Ethereum ETFs saw $1696 million in net inflow [1]

All right. What do you make of just the kind of the market movements we've seen in the last, you know, four or five trading days or so after the president kind of ramped up the tensions in the trade war. We saw a big decline and since then we've been kind of rangebound.What does that say about investors and their confidence that this trade war is going to be resolved in a positive way. Well, I think the market has been equity market in particular, Frank, has been uh extremely resilient in the face of a pret ...

Policymakers from Asia’s largest economies turned out in force this week to defend their currencies as the trade war intensified, and strategists say their mission has only just begun https://t.co/Hu7L4m4sIp ...