 Today I have the pleasure of speaking with her own Jack Lipton. How are you today Jack? I'm fine Tracy. How are you? Well, I know I promised I wouldn't ask you this, but I can't resist Jack any final words on Molly course since you did call this No, I know actually they sort of vanished from I don't think they're giving out public announcements right now And I think the next thing is when they reappear in court next week for the next Trance show up that are in possession financing. So it's like a soap opera. We'll have to just tune in and see what happens Jack you just wrote what I thought was an outstanding piece this week titled China's middle market sphere is Everybody's worry and you had some I thought you had some very important messages in here Including the fact that you wrote the undeniable fact is that China the world's most populous nation and the world's largest second Economy has now become the largest end-user of technology metals and materials from the manufacturing of consumer goods in the world I'd love for you to expand on that, please I Still don't think that the average person In the West or maybe anywhere else is aware of the fact that China is the world technology metals and materials market At 60% of all metals and materials produced in the world are now going into China How can we say? Whatever happens in China doesn't affect the entire market. The interesting thing to me is that if the Chinese market It demand increases. That's of course a very positive thing for for non Chinese wrong-trial producers If it decreases, it's a disastrous thing so we're all hanging on what's happening in China and It doesn't matter whether the US economy of European economy is up down sideways These are not where the demand is for technology metals and materials. It's primarily China Korea India is coming along the focus of demand is Asia East Asia and so let's start paying attention to what's going over on over there in their economies That's why once when there's a glitch in an economy of a country like China When they when they sneeze we all have to take penicillin All right, and on that note I think you have been an avid supporter of topics on items such as rare earth recycling for North America Would you mind just explaining this a little bit to our audience right now? I mean, where are we with rare earth recycling? I saw one professor from Pennsylvania on TV last week. Never heard of him by the way Talking about this and I'm aware of some recycling deals and some companies that claim they're going to be doing tailing recycling. Can you tell us a little bit more about where that market is presently? my Observation on that market is that it is the next Logical market for the West in other words as a friend of mine who I won't identify But he's from north of the US Canadian border set to be last week People are tired of digging holes in the ground and filling them with money It's time to look at conserving what we use and recycling what we don't what we have used up This is this is definitely the future as far as all these announces about recycling They they've been there for the last 10 years. Everybody's got a plan to recycle What they don't have is a plan that matches recycling what with what exactly the market wants if you're really it doesn't matter How you're producing let's say a rare earth permanent magnet you must produce rare earth permanent magnet alloy to a Specification and all I read about in these recycling Announcements is well they they manage to separate 90% of of the rare earths from each other In the magnet that would be the Pennsylvania one you just cited or or the United States government having spent a hundred trillion dollars Produce five cents worth of disposal something like that. I read this all the time. Okay, the end users don't care How they get the material we care because we we found out we can't afford To do much in the way of new production from new mines is too expensive We haven't that hasn't yet ended But these these these junior ventures are sorting themselves out rapidly by price cost the only issue that matters is cost of Producing the material Recycling takes advantage of the fact that the energy and the reagents used to extract these materials from the ground Separate them and purify them have already been used what you you don't have to do anywhere near as much cost Don't put nearly as much cost into a material to recycle it as you did originally to to get it out of the ground and Produce it in a useful form It is obviously the default way to get some material at least We should we were cycling everything we can this would be which obviously we do is our dependence on let's say insecure foreign sources and Sources in our own countries that are too damn expensive to develop So we say recycling time is here Somebody with business sense has to get into that not just announcements from laboratories Please I can't stand any more of them. They're already too many of them. Let's just do this Let's let's get some business involved same thing as I've been saying about junior mining for years Forget all the announcements Let's produce something and if you can't make it for less than the other guy You better find something else to do for a living. Well, speaking of getting some Savvy business players involved With great Western. I'm very surprised. We haven't heard an announcement about who has Taken over or tried to acquire Less common metals or LCM. Well actually know something about that but Let's put it this way LCM turns out to have liabilities far exceeding its asset value So that if you go to acquire LCM it turns out you're you're going to have to take on these Liabilities when you add those numbers together It doesn't work out So I don't know if anybody's going to buy LCM, but whoever it is it better have deep pockets Well speaking of that because I have one item with regards to Great Western and LCM for instance As you know or as we know in the industry, there are very few people that understand rare earth elements in general Including many of the individuals in the industry because it's quite complex. I'm glad you said it Yes, so in lieu of that It's my understanding that some of our top most talented professionals in the industry with real experience qualifiable and quantifiable experience are Presently on the payroll or were on the payroll for LCM Who do you think or who do you recommend might want to pick that that group up or do you have any ideas on this Jack? LCM's problem Has been and continues to be sourcing raw materials like everyone else at the end of the day They have to get them from China and that that is obviously a game and control of the Chinese Who whoever picks up LCM has got to be somebody that has a source of material For for them to process. I believe that they have always been in input material limited That's why they only produces us relatively small amount compared to their capacity because it's all they can produce I hate to say this but I I would almost bet Your money that that in fact probably a Chinese company As a Western outpost that's my thought or Japanese, but the Chinese have I think are are more likely to do it Well, I have to say that your response is very Consistent with the information and feedback that I'm receiving and I think just on one final note We're starting to see a lot of M&A deals They're just starting to happen now in the resource industry and as you know this sector has been Quite challenged and depressed now for the last couple of years But I've noticed we haven't had any M&A deals yet in the rare earth industry I think that's because the The people who have control of the of the let's say more among juniors want too much money for them And I believe money is just sitting on the sidelines waiting. I think you're absolutely right. They'll be there'll be a consolidation In the very near term because that's the only way to reach a an operating threshold where you or somebody can be profit Of course with everything that's happened with molly core. There are a lot of rumors in the US retail market We're getting a lot of comments and a lot of emails with people basically believing that the entire industry has bottomed out And there's no industrial metal strategy for North America as a result of losing molly core Because molly core had a very good marketing team that that did Factor prominently in this industry Can you correct this notion or this is misguided conclusion? For all so I can just send everybody a link to your answer. I'm trying to avoid the snark But let's put it this way molly corp was great at selling molly corp. They weren't so good at producing and selling rare earths They have not ever been a factor in the actual supply of rare earths in the global market So being there or not being there makes very little the most they ever produced last year was 5,000 tons net Refined in China and Estonia out of over a hundred thousand tons So if they disappear tomorrow, which is very likely what as as an American presidential candidate might say what difference does it make? Well as always, thank you so much for joining us today Jack Thank You Tracy, and I look forward to our next interview