There's No Hope for Molycorp

Molycorp is fighting the same supply/demand dynamic that brought it to the forefront in 2010 and there's little the company can do to change its fate in the long run.

May 16, 2014 at 1:00PM

When Molycorp (NYSE:MCP) was a hot stock in 2010, it was because rare earth mineral prices were through the roof as China cut back exports. As the theory went, if Molycorp could open its mine in a timely manner, it could take advantage of those high prices and make a mint for investors. 

But the inelastic demand for rare earth minerals that led to high prices in 2010 also resulted in a rapid drop in prices when Lynas in Australia and Molycorp opened their mines. Suddenly, the tiny rare earth mineral market was fully supplied and buyers didn't have to pay high prices for the materials they needed. 

The resulting impact on Molycorp has been falling revenue, even with increased production and massive losses quarter after quarter. There seems to be no end in sight to the financial challenges and, before long, another share offering may be needed to stay afloat. In the video below, specialist Travis Hoium covers Molycorp's challenges and why this is an investment you should stay far away from. 

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Travis Hoium has no position in any stocks mentioned, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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