If we do move from a carbon to a lithium based economy, what are the implications? Will we all become mellow? Politicians, industrialists, and environmentalists who see battery powered vehicles as the wave of the future are overlooking the fact that 50 percent of the world reserves of lithium are found in impoverished, landlocked Bolivia. This is a country that, until now, was best known for killing off famous foreigners (Che Guevara, Butch Cassidy, and the Sundance Kid) and being the source of a new form of venereal disease. Lithium ion batteries are four times more efficient than the current generation of nickel cadmium ones, and are essential for electric cars to finally become economically viable. But now that the country finally has something the world wants, nationalism is rearing its ugly head. Local politicians see their country as the Saudi Arabia of the highly corrosive, toxic, reactive metal, and are already discussing ways to restrict access. Will La Paz become the headquarters of OLEC, the Organization of Lithium Exporting Countries? The only other supplies are to be found in Chile, Argentina, Australia, China, and Nevada. Should the US invade to insure supplies? Iraq worked didn’t it? The safer way for opportunistic investors to play this is to look at Sociedad Quimica Y Minera (SQM), Chile’s largest producer of lithium, which has already seen its shares nearly triple this year.
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