If you think about the 20th Century, for the longest period of time, the nation with the most power has been the United States. With the rise of China first as a manufacturing center and now as a service economy, power dynamics in the world are changing. In the past, the United States government could highly influence the direction of the world, and it would be foolish for any country not to think it still can. But other countries are moving up and challenging the US and some are successful, and some are not. The changing power dynamics means occasionally what seems to be a simple decision is more complex because the other country can take measures on their own.

In an article by Keith Bradsher of the New York Times News Service, to make advance computer chips some rare earth minerals are required. Some of them are found in China or controlled by Chinese companies. For example Shenghe Resources biggest shareholder is the Ministry of Land Resources.

The Chinese government has imposed restrictions on rare earth minerals that are either mined or refined in China. If you think about food grown by producer and traced to your table, the Chinese government passed a regulation that all exporters must provide authorities with detail, step-by-step tracings of how shipments of rare earth are used in Western supply chains. This gives China authority over which overseas companies receive scarce supplies.

China is taking greater corporate ownership over the mining and production of metals. 3 state-owned companies are taking over all the mining and production of rare earth minerals.

China has moved to control the supply chain of obscure chemical elements that are needed by semi-conductor manufacturers. The country restricted exports of antimony, gallium and germanium.

National security officials have tightened the flow of information about rare earth. They have labelled rare earth mining and refining as state secrets. The Ministry of State Security has arrested and sentenced people to leaking information to foreigners.

The White House released a statement that China had cornered the market for processing and refining of key critical minerals, leaving the US and our allies and partners vulnerable to supply chain shocks and undermining economic and national security.

The statement refers to the demand for Artificial Intelligence chips and who gets them and who does not.

Linking to dividend paying stocks, details are important. Politicians love to saw things that seem simple, but the reality is much more complex. If you invest in a profitable company, then it should be working with the government. The government will have its agenda, but often it fits nicely with the corporate agenda and as an investor you like that for seemingly the government has the company’s back. If that happens politics is working for you and the company.

There are more questions than answers, till the next time – to raising questions.