OPEC really plays 2nd fiddle in economic influence.
Posted in the Top Stories Forum
Since: Feb 13
#1 Feb 23, 2013
OPEC has the physical control of oil. That allows them to do as they like.
Unbeknown to everyone there has been a silent and equally restrictive global cartel/agreement (call it what you like).
Hard rock underground mining provides the economy with only some of the Base Metals, Rare Earths and Precious Metals.
The question I have is why is it only some?
The controlling mining entity is seated with 3 public companies. They are Mining Machinery Manufacturers: Sandvik, Atlas Copco and Caterpillar (SACC).
Essentially, it is they and only they that build the total output that any global mine site can achieve.
It makes sense: you can only mine as much metal ore as you can move right?
I emphatically disagree with that understanding the world has today.
Base Metal Mining is split into two categories:
Surface Mining and Underground Mining.
It is the relationship between these two types of mining that will make you shiver.
The relationship has been manipulated into raising the price of base metals by restricting low cost metal supply from underground mining.
How this has happened is brilliant and complex. Hence, why OPEC only plays 2nd fiddle to this primary sector control.
It is hard for you to believe that SACC have shaped their businesses in such a way that the inner sanctum of our global resource supply is locked away underground. SACC seem to provide the latest technological advances, product applications and system controls.
However, when you go underground everything changes. In a confined space everything interacts. And it is these interactions that SACC use to slow underground mining. Brilliantly and discretely hidden from view.
SO why would SACC slow/restrict underground mining over decades?
By slowing underground mining, the supply of base metals on a global scale is reduced.
Reducing the supply increases the price.
Increasing the price allow surface mining to become more viable.
A more viable surface mining industry allows for 10 times as many mining machinery sales as SACC could have made underground.
Simply put it is extremely more profitable for SACC to slow underground mining than speed it up.
Remember this is global and affects the price of every single ounce of metal on the planet.
But there is a problem with that, or at least with the current global consensus.
Why would the Mining Companies allow (if they knew) SACC to restrict underground base metal mining?
SACC are global therefore, their influence is global, coordinated and precise.
Why would the mining companies be upset if SACC restricted global output all at the same time and over decades?
Restricting global output means the base metal prices keep going up.
This means bigger returns for the mining companies that can easily afford the intentionally high CAPEX costs provided by SACCs favouring of surface mining.
A global closed-circuit monopoly
Stunningly brilliant in design!
SACC have created a global base metal pricing monopoly type situation.
OPEC is powerful because it actually holds the physical oil.
SACC do not!
The only thing holding the world economy back in terms of the pricing and supply of base metals is the Intention that SACC have.
This knowledge allows Global Manufacturing to drive lower base metal costs by supplying the techniques and mining machinery to allow fast underground base metal output. Bypassing SACC and their intentions.
Then a series of global financial and economic events will take place.
Global investment confidence will skyrocket due to lower base metal price projections (within two years)
Allowing for the value added process (tied to base metals) to be fully integrated into our modern manufacturing economy.
The global economy will rejuvenate into life.
General Electric, Komatsu, ABB, not to forget Sandvik, Atlas Copco and Caterpillar have enough mining machinery manufacturing capacity to pull this off between 12-24 months.
Since: Feb 13
#2 Feb 23, 2013
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