The NY Times reports a Chinese embargo on rare earth minerals—crucial ingredients for countless, very important things—has been applied to the US. Oh, and China possesses 95% of the production capability for this stuff on the entire planet.

The embargo—still denied by Chinese authorities—is only the latest in a growing economic pissing match between the US and China. The contention boils down to a simple fact—despite these minerals being all over the planet, China is the only country in the world currently equipped to mine them out of the ground. This gives them considerable clout when it comes to trade relations—an increasingly tense topic between these two nations.

Japan is already on the rare earth minerals blacklist, but, luckily for them, has a pretty substantial stockpile of the stuff. The US, on the other hand, does not. What does this mean for the US and its domestic corporations? Nobody's really sure, but it can't be good news. "If it's true, it's disturbing news to say the least," says Jeremie Waterman, the China director of the United States Chamber of Commerce. To say the least! These minerals are things you've probably never heard of, rare more in name than abundance—cerite, allanite, monazite—but if American companies want to build cruise missiles and cell phones (and they definitely do!) they will need these minerals.

So what's next? Possibly high-level, multinational meetings to decide whether China is violating trade laws. But sanctions seem like a longshot. Or, the US will have to start expensively building the ability to mine the stuff itself. Or, the US could return fire with an export embargo of its own. But what does it have to hold back... perhaps Justin Bieber videos? [The New York Times]

Full story here: http://gizmodo.com/5669143/china ... d-other-necessities

I find this hard to believe.

The U.S. is China's biggest customer for the exports they need to sell if they want to continue with the current economic expansion.

In any case a lot of the goods, such as cell phones aren't manufactured in the U.S.

An interesting concept since china can try to drive the cost of us manufacturing up making their product cheaper even than they currently are.  It is possible then that would allow china to have the yuan appreciate somewhat since American goods cost more.  If there is truth to the story then there is a reason china is doing this apart from starting a riff.  What is it?

It means fuck all tbh.....

In that when people say rare earth minerals and materials they mean the concentration when mining is pretty damned low. Such that you have to dig a massive fucking hole to get the stuff you want.

A certain type of clay in the UK required 16 parts spoil for 1 part of the stuff you wanted.

Such mines exist in the USA and South America. The problem for the USA is that the companies took China's bait....

China said hey come and mine the stuff here! Wages will be LESS than fuck all, environment? Nobody here gives a fuck! So the companies shut down their US operations and moved to China to save money.

Me thinks competitive advantage.... 10 years ago it was cheap wages and super uber infrastructure/economies of scale.

Now China is wealthier exactly like Japan and Korea the people aren't happy about working for pennies any more. Therefore to be sucessful in business you've got to have some sort of competitive advantage. If China has mines mining the stuff and they slap big fattaxes on exports of these things they maintain a massive competitive advantage.

It makes sense for china to charge fair value. This is inflationary if it is because the workers demand higher wages.  That os the classic sign that inflation and pressure on prices is creeping up.   Again this should mean the currency is going to appreciate.

if the US and china go at it and the currency war continues nobody will win....I think most people can understand Chinas position though, they are just looking out for their well being rather than theUS's

Oh good, its a real embargo.  Reading the title of the entry, I thought you were writing to say the Chinese were now keeping all their beautiful young women at home, and only exporting their old ones abroad.

Thanks. . .  I am much relieved.