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Europe Just Entered |
15,000 New Elon Musk "Supercomputers" |
Just In
Just as I was about to hit send on this piece, I did a little more digging—and wouldn’t you know it, Reuters just dropped some fresh news:
The European Parliament condemned China on Thursday over its export restrictions on rare earths and insisted the European Union must reject any attempts by Beijing to use the restrictions to force concessions from the bloc.
As Ron Burgundy would say: “Well, that escalated quickly.”
But don’t be fooled—this is just Brussels doing what it does best: puffing its chest while tripping over its own shoelaces.
The motion—passed by a wide majority—urges China to lift restrictions “imposed in the midst of a trade war with the United States.”
Yeah, I’m sure China is shaking in their boots.
Sure, it might ruffle a few feathers in Beijing, but in reality, it’s just another textbook case of the EU talking tough while doing nothing that actually helps its own citizens.
If Brussels actually wanted to help, it could start by getting out of the way—and nudging member states to cut through the environmental red tape and streamline permitting.
But your average EU Joe shouldn’t hold his breath.
A European version of Trump’s March 2025 Executive Order—which used emergency powers to fast-track domestic rare earth mining and processing—isn’t coming anytime soon.
There’s no mention of boosting local mining or processing in the draft EU Commission document I mentioned.
Classic Brussels. They want the benefits, but none of the mess.
And with Europe's layers of red tape, strong NIMBY sentiment, and only patchy refining capacity so far... good luck. Just look at the Norra KΓ€rr project in Sweden—stalled for years over environmental protests. Or here in Spain—where I happen to be at the moment—the Matamulas deposit continues to face ferocious opposition, despite being one of the most advanced rare earth projects in Western Europe.
Trust me, Europe won’t be mining or refining rare earths in any meaningful way anytime soon.
Before the Mania Begins
This means Europeans will stay buyers—just much bigger ones—not producers.
And that’s great news if you’re on the other side of the trade.
Yet despite this perfect storm of geopolitical tension and government panic, rare earth stock prices are near cycle lows. Take a look.
What jumps out is that rare earth stocks still haven’t broken out of their three-year downtrend. The chart shows the VanEck Rare Earth and Strategic Metals ETF (REMX)—a go-to proxy for the rare earths sector—and it remains nearly 65% below its 2022 peak.
Now, here's something else to note that's not super clear in the chart above: just how much rare earth stocks remain down from the 2010 bull market. That was when China's rare earths export ban sparked a frenzied rally in rare earth stocks. While I couldn't track down all the price data going that far back for this chart, a quick search on Yahoo Finance will show you that REMX is now trading nearly 90% below its 2010 highs.
Not a bad time to get in ahead of a potential mania.
Lau Vegys
Doug Casey's Crisis Investing and Grey Swan Investment Fraternity
P.S. from Andrew: We’ve been well ahead of the rare earth story, covering MP Materials as a special report position earlier in the year.
Shares have surged nearly four-fold off their spring lows, following an investment by the United States last week – and a $500 million investment from consumer tech giant Apple yesterday.
There are a few other rare earth plays out there, but another overlooked factor as Europe looks to build its reserves is in defense products.
The Eurozone spends about 40% of its defense budget with U.S. defense contractors, and as I explained in research in our just-released July Grey Swan Bulletin – which you can read by subscribing here – America’s defense companies stand to benefit from a megatrend of rising defense spending in the years ahead.
Your thoughts? Please send them here: addison@greyswanfraternity.com
How did we get here? Find out in these riveting reads: Demise of the Dollar, Financial Reckoning Day, and Empire of Debt — all three books are now available in their third post-pandemic editions. You might enjoy one or all three.

(Or… simply pre-order Empire of Debt: We Came, We Saw, We Borrowed, now available at Amazon and Barnes & Noble or if you prefer one of these sites: Bookshop.org, Books-A-Million or Target.)
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