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Molycorp, Inc. Message Board

votingmachine 267 posts  |  Last Activity: Nov 21, 2014 8:33 PM Member since: May 12, 2004
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  • votingmachine by votingmachine Jun 17, 2014 6:06 PM Flag

    There is a new SEC filing on Molycorp's investor page. The RCF shares have been selling at a fast pace and they are down to a 4.4% of the company. I haven't looked at the numbers well enough to know if they are at their target share holding or not. But FYI, it is there ...

  • votingmachine votingmachine Jun 4, 2014 9:43 AM Flag

    "The WTO decision does not change the strategy, just the means at China's disposal," said David Abraham, an independent resource analyst.

    "The tools of the day are now taxes, exchanges and regulations to consolidate companies into a few champions."

    "So I think they're looking at what they need to do in the long-term to take what was once an export tariff and turn it into a resource tax so the net result is positive."

    That is what I consider likely. They can abide by the decision, and still have achieve the same policy objectives, just using different tax tools, along with the control they can exert over producers and consumers of RE's in China.

    As an example ... China cannot have a 100 ton supply and a 10 ton export quota. But they can limit the operating license of the supplier to 100 tons, and they can order a 90 ton per year contract with a few internal consumers. Th net effect is that there are still only 10 tons free for export. They can impose a uniform $10 resource tax on all 100 tons. And then give an unrelated tax break equal to $10 per ton, to the Chinese companies consuming RE's. The de facto tax is $10 on exports.

    Remember that the Chinese government has authoritarian power (25 years from 1989 Tiananman Square crackdown). They allow capitalism, as a compromise, but can still impose on the companies in the economy. The communist party had driven China to abject poverty, and they realized they needed to allow economic freedom, but they retain absolute political power. It is a weird system. And it needs to be considered in evaluating the effects of the WTO decision.

  • votingmachine votingmachine Jun 3, 2014 3:07 PM Flag

    No. That is not correct. Many brokerages do not allow accounts to short stocks below certain thresholds. But the market does not have that as a rule. If you can borrow shares, you can sell them short.

  • Reply to

    Votingmachine

    by bond_trader007 May 28, 2014 8:09 AM
    votingmachine votingmachine May 28, 2014 11:20 AM Flag

    I'm not happy with the delays and the lack of communication from management. I am more unhappy that the market moved wildly against me.

    I still click thru to this MB most days, but don't click thru to threads very often. Maybe one or two. There is not a lot of content that is worth reading. I used to like the Yahoo MB's but they are easily rendered useless by the useless posts. The threads with the cut-and-paste repetition are easily identified and ignored, but they defeat communication, simply the volume prevents any real discussion from happening. These boards ALWAYS have a high percent of useless posts, but that percentage is now above my own tolerance level.

    MCP's business is fairly simple. The path to success is easy to understand: they have to move Mt Pass to a profitable operation. They plan to do that by operating at a higher run rate with lower costs. If they can move Mt Pass operations to profitable, the company will be profitable. I still think that the most probable outcome is to achieve that Mt Pass transition to profitable, without any further access of capital for burning in startup.

    Q2 won't be any great quarter. April was 520 mt of Mt Pass production. If the average per month grows, they will still be under the 1000 mt per month that they have identified as nearing the economic break even, for the entire quarter. The magnet sales have been so much weaker these last 2 quarters that you have to assume they are losing customers, rather than acquiring customers. They made money, but not with the growth we want to see.

    The market is pricing in the expectations of more quarters with more cash burn, and a higher chance at needing more cash to fund the cash burn during ramp up. I still add up the numbers that they should have enough cash on hand to fund the burn.

  • Reply to

    Votingmachine

    by bond_trader007 May 28, 2014 8:09 AM
    votingmachine votingmachine May 28, 2014 11:05 AM Flag

    I'm still holding. I didn't see a reason to make me react with the speed it would have taken to avoid the haircut after the quarterly report. Anybody would prefer to have sold at the higher price, even if they like having a long stock position.

    I don't have a stop-sale price. I generally think stops are just a way to lose money, more often guaranteeing a loss, rather than protecting. Stock prices have a way of random walking thru any tight stop, causing a sale at a temporary minimum. So I try to digest the news and make informed decisions. The speed of the market is faster than me.

    I don't have the general CEO worship mentality of most investors, who need to believe in the magic of the management. I believe that businesses should be understandable enough to be run by monkeys, because that will be the case sooner or later. Mines are especially simple, and mining management tends to match that simplicity. It really isn't some crazy difficult thing. We love to think the processing is wildly high tech, but miners have been mining for THOUSANDS of years. Rare earth isolation is a bit more excruciating chemistry, but it is still just repetitively taking dirt and running the same process over and over.

    I think the business case is still strong. The ore is good enough, and the processing technology is nowhere near as difficult as generally believed. The high cost is a mixed situation: it sucks to be the owners of a business that needed and spent way more money than originally expected, but it is a true barrier to entry.

    I think that management is adequate to the task of telling the engineers to de-bug and ramp up the facility. They may not understand the nuances ... they certainly don't communicate that understanding. But the CEO and management need to be responsible for the business strategy, not the details. They need to evaluate the high level plan. I think that the most important skill we need in a CEO right now is a product salesman. Customer schmoozing, etc.

  • Reply to

    Anyone else making Molycorp THE LAST STRAW?

    by pearsonkatie732 May 27, 2014 10:50 AM
    votingmachine votingmachine May 27, 2014 11:49 AM Flag

    Good for you for being successful.

    But the fact you mention and accept is that the market is crooked. A great deal of it is run by investment banks. Whether thet are running an IPO for a company without earnings and hyping it, or hiding risks in exotic derivatives, the market is rigged in favor of large Wall Street, and against investors.

    The entire point of a stock market is to allow capital raising, and to allow partner ownership of businesses. It is fine that you accept the risks, and think an occasional loss from a lure of fast riches is just the price of doing business. But I would encourage you to not be so blase about a system that has already taken money from you, but not yet at a level you cannot tolerate.

    You are right that listening to anonymous posters on a Yahoo MB is foolish. But you are wrong when you say that the market has an acceptable level of crookedness, because you are still making money. No level of crookedness is acceptable. Yes, we all are personally responsible for our risks. If you bought Enron ... just your risk, fraud happens. If you bought Twitter, just your risk, controlled hype by large players happens. If you listened to a news story and invested, your risk, dishonest reporting is the way of the world.

    I am not so sanguine about the market. I think it is bad and getting worse. At some point buying stocks will be worse than buying a used car at a small crooked car lot. That beautiful car, driven on Sunday, by a little old lady, will turn out to be the million-mile hoopty, which was in a river for a week. Your ability to make money gets diminished by people giving up on the chance at an honest market.

  • Reply to

    Management Failing

    by pbtoption May 24, 2014 5:51 PM
    votingmachine votingmachine May 27, 2014 8:41 AM Flag

    This is a Yahoo message board. Don't take it as a barometer of investor sentiment. It is 90% garbage. Longs know the risks.

    I agree about the vagueness of the answers. I posed a few rants about that after the CC. The company is in the homestretch of their business plan, and all they said was vague talk about obstacles and difficulties.

    I don't really agree that the risk of bankrupt failure is as high as your warning seems to indicate. Mostly, people recognize that this stock trades heavily on the quarterly reports (a bit ridiculous, but it is what it is). That talk of obstacles, and failure to commit to even the worst end of the timeline (previously, saying second half, now saying the goal was December, and will be tough) ... that talk tells everyone to expect another several quarters of bad reports.

    The loss center for the company is the Mt Pass operations. Every quarter they are running at high expense and lower revenues. They need to have the high volume low cost production that the facility and business plan call for, to move to good results.

    Most of my anger has to do with the vagueness of the schedule and lack of information. It is unacceptable that they are providing only quarterly updates to the most important part of their business plan, and they are unwilling to speak with any detail, or endpoint confidence.

    Project Phoenix is wildly behind schedule and over-cost. And on top of that, they won't tell us anything.

    This message board is largely the playground of a few disruptive, high volume posters, who think that the content will move the market. It isn't in any way a meaningful market sentiment indicator. Of course there are passionate longs and committed shorts, and a few of them argue here. The majority have more nuanced positions, and since the content is #$%$, aren't going to read and respond.

MCP
1.14-0.11(-8.80%)Nov 21 4:06 PMEST

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