Elephant in the Boardroom

My first post should appropriately begin with the elephant in the boardroom, that is, the Afghanistan lithium fiasco. When the United States invaded Afghanistan in 2001, many were excited about the mineral riches the country had to offer, as is the case whenever a relatively undeveloped country is tapped for the first time. The Soviets had discovered lithium deposits during the occupation in the 1970s, and with the rise of cell phones, cameras, iProducts, and electric cars with lithium batteries, Afghanistan’s lithium had become the elephant in the boardroom of every entrepreneurial mineral extraction firm in the country.

It’s 2010 and not an ounce of lithium has been extracted from Afghanistan’s rocky crust. Why? Simple. One particular group - i.e. the Louis Berger Group - got greedy. Normally a project of this size, meaning the extraction of an amount of lithium equal to a significant percentage of the world’s current supplies, must be a team effort. Securing such massive supplies and essentially assuming control of an entire country with virtually no remaining ideological state apparatuses is a huge undertaking, one that cannot be achieved by a handful of corporations no matter how much capital they possess. American work crews should have been blasting through Afghanistan’s bedrock years ago, but because the boys on the ground wanted it all for themselves and did not possess the means to secure these lithium reserves immediately, it has become increasingly likely that Chinese companies will eventually take the lion’s share when all is said and done. As a result, we will all have to move a significant amount of our capital to the Chinese markets in order to maximize our gains; a considerable risk given the capriciousness of the Chinese economy. What’s worse is that with recent reports released by the Pentagon about these rich lithium reserves - a foolish PR stunt by the Obama administration - the American public has now been promised something they will never get: lithium profits and super-cheap gadgets and gidgets. This is further proof that those who are in the hot-seat for the moment are thinking very narrowly. We need to think long-term about this situation, before this veritable treasure trove completely slips through our collective grasp.