Rare earth resource junior Defense Metals Corp. (TSXV:DEFN) has seen its stock price climb recently
Bob Moriarty | May 27, 2020 | SmallCapPower: It’s a stretch to imagine how a worldwide panic over a flu would have any sort of a positive impact on any junior resource stock but actually there is a company that may have just hit the jackpot as a result.
(The following is an article originally published on 321gold.com on May 18, 2020)
As a direct result of the Chinese literally shutting down their entire economy for a couple of months in response to the Corona Virus, the single source supply chains for nearly everything China produces were utterly broken. For some commodities such as rare earths required for specialty metals and military purposes, it was a giant wake up call.
Now I am not a believer that China or Russia for that matter are enemies of the United States. I believe that the MIC needs monsters to slay to justify the US taxpayers funding half the military expenses in the entire world. But having China as a sole source for anything is stupid and beyond stupid for metals so critical to the functioning of our economy as Rare Earths.
I’ve done articles in the past on Defense Metals Corp. (TSXV:DEFN). The share price is up 50% in the last six months and still cheap. They have made wonderful progress and just announced on the 13th a major addition to their 43-101 resources at Wicheeda in central British Columbia. The resource showed a 49% increase in tonnage and a 30% increase in average grade. It was economic before and I showed the numbers in the December piece. It is much more economic today.
The US realizes that a safe and secure supply of Rare Earths from outside China is mandatory. The Federal Government has already defined Rare Earths as critical resources. A bill in Congress today calls for changing the tax deductions for mining companies in the US of Rare Earths and creates a $50 million fund to help junior companies out. That’s just in the US but one day soon they will figure out that the US just doesn’t have much in the way of REE but Canada has a bunch.
We are in a depression. I’ve said it was coming for years. As long ago as a year ago I was saying it would start in October. It actually began a month early and became obvious to everyone in March. But the vast majority of people think it is somehow connected with the Corona Virus. It is not. It was coming any way with or without a bad flu season. The Corona Virus just made everything speed up. Now the majority of investors think that as soon as the quarantine ends, the economy recovers. That’s not going to happen any time in the next fifteen years. It is the greatest depression in history because we have the greatest debt load in all of recorded history.
We will have the most massive wealth transfer that has ever taken place from those unprepared to those who are prepared. My readers are prepared and will see rewards such as they have never dreamed possible. We are going to have deflation and hyperinflation at the same time. When the government gets tired of being stupid, we will declare a debt jubilee and go back to honest money. Eighteen months later the economy will recover.
Defense Metals is an advertiser. I have bought shares in the open market and in various private placements. That makes me biased so I request readers do their own due diligence.
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