The approaching AI roadblock

"Solutions? Unless we can find some hidden deposit, which nobody knows about, our only hope it to find an asteroid which contains enough of these valuable elements to go after. Other than that, we need to go hat in hand to China when our 6% is not enough to suit our demands." 

Who is leading the world right now in AI technology? Many think it is the United States. Why? We have many companies who are sinking zillions of dollars into R+D and coming up with some promising solutions. Take Nvidia for example. They are leading the pack right now, and many Nvidia shareholders are smiling all the way to the bank. Sky is the limit, right? Not so fast - maybe not.

There is a huge roadblock ahead and finding a way over it or around it might be a bridge too far. In fact, it might come down to dancing with the devil (doing more business with China). Why? We have a voracious appetite for materials which go into making these almost magical chips. Some of the key components come out of the Rare Earth family of minerals. And that is where the problem lies.

China is blessed to house over 60% of all the Rare Earth minerals on the planet. Full stop, plain fact. The United States has less than 10% of all known deposits - like 6%. Myanmar has about 15% of the world's supply, but mining there is a fool's errand. Why? It is a mess. Unregulated, and armed camps are trying to control the supply which is mined. It is dangerous place to visit, much less do business there. So, that leaves China as the country we need to go to for more supply.

China and the US have a symbiotic relationship with chip manufacturing. They know we have a technology edge (they would love to steal more trade secrets from Nvidia), and we need some of their supply of Rare Earths. Where does that leave us? If we are not at war with China over Taiwan, we have a very fragile trading platform. However, once war breaks out, both countries are screwed. We need each other, but don't trust each other more than we can throw each other.

Solutions? Unless we can find some hidden deposits, which nobody knows about, our only hope is to find an asteroid which contains enough of these valuable elements to go after. Other than that, we need to go hat in hand to China when our 6% is not enough to suit our demands. 

Is this a dance with the devil? Seems that way. BTW - China also has many of the elements we need to make electric car batteries. Let that marinate as we head for Joe Biden's electric car mandate in our very near future.