To be clear...
There are only three reasons MCP is failing...
One is the greed of the management, who based the promotion of the business on an expectation of sustaining wildly unrealistic pricing, thus allowing the business to divorce itself from ground truth reality based in costs, ensuring it could not and would not survive imposition of demand-supply based reality in pricing.
The second is the greed of the bankers... who knowingly facilitated management's effort in divorcing the business from reality, in the full expectation that enabling its failure would mean they'd end up owning 100% of the business, including all the value being built by others equity investment, as a result of lending them money that the company didn't need to succeed... $ which the management pissed away.
The third... is the greed and stupidity of investors in all classes... who, even with it having been shoved in their faces, refused to see it, and thus failed to bother doing the math... which clearly proved the business wasn't designed to be viable, even from back in the planning stages. I pointed that out even prior to the launch, but, investors continued throwing money at them even as the implosion was occurring... as reality began happening in demonstrable fashion.
In the result... traders made a killing on the trade, up, and down... management made out like bandits on the run up, before handing it over to others to supervise the inevitable implosion... the bankers believed their own propaganda and figured they couldn't lose by lending that guaranteed they'd ending up owning 100%: but, the shrinkage of the equity can't transfer surplus value to the debt holders when the value isn't there to transfer. The only bankers who can win... are those who lent money last, with specific limits. They'll end up owning the remnant of the business that's worth owning... and not the smoking hole in the ground. And, then, the retail buy and hold crowd... those who bought the story being pitched... got scammed again.
Lynas is only incrementally better... also badly mired in massive debt... but, all they have to do is be a hair's breadth faster than MCP... and it will be MCP and not Lynas that gets eaten by the bear. The recent news re Lynas production suggests that is happening now... customers are apparently shifting purchases to the one they expect to survive... making it less and less likely that the additional debt load being taken on in the BK will do anything at all to alter the inevitable in the outcomes... other than amplify the losses.
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