Photo: Rare Element Resources
Yesterday it began. We started getting stock spam for rare earth metal-related stocks in our inbox.The unfounded reports that China is going to clamp down on rare earth exports has sent investors into a speculative frenzy for any and all stocks vaguely associated with these elements that that power defence, alt-energy, and auto tech.
One big winner is MolyCorp, the company mining in the US that had Goldman as a backer, has surged 3-fold since its IPO. And it jumps every time. Note that the company has no revenue. It just has a mine.
But investors are looking for dicier names as well.
Shares of Rare Element Resources are up 12-fold in the last year, also with no revenue yet, but it has access to gold, rare earth elements — both of which investors are going gaga for. And of course there’s the China element, so really it’s at the sweet spot of three bubbles?
Obviously it’s a total gamble for anyone interested.