Daniel McGroarty

In his testimony before the U.S. Senate Committee on Energy and Natural Resources on “the Near-Term Outlook for Energy and Commodities Markets” last week, ARPN Principal Daniel McGroarty argues that while in the long-run, the market is self-corrective, there are certain actions that should be taken while we wait for that long-run to arrive if the U.S. wants to regain its economic strength and manufacturing might.

McGroarty points to the risks associated with our growing – and largely self-inflicted – dependence on foreign-sourced minerals and metals which have “implications for the strength of the American economic recovery, for the revival of U.S. manufacturing might, and for the hoped-for dominance of U.S. ingenuity and enterprise in the advanced technology applications that we know are shaping the world of the 21s Century.”

He argues that if the United States continues down the current path of reducing exploration spending while prolonging the already onerous permitting process for mining projects, resource development, and with that associated manufacturing, will move elsewhere.

Outlining several helpful first steps to mitigate these risks, including Sen. Lisa Murkowski’s (R-Alaska) American Mineral Security Act, he concludes:

“I don’t think there’s another nation in the world that can match American ingenuity.  We can pioneer the ideas behind wind and solar and so much else – but where will the materials that make these new energy sources real – where will they come from?

How we answer that question will determine to a large extent whether the U.S. can regain its manufacturing might…  Whether America will lead the alternative energy revolution…  And whether the U.S. will have the metals and minerals we need to provide the modern military technology we depend on.” 

Click here to read the full written testimony.

The new year typically is the time for people to reflect on the preceding twelve months and make resolutions for the new year.  In an exclusive to the Vancouver Sun, our very own Daniel McGroarty, who serves on the advisory board of mining company American Manganese, joins ARPN expert and CEO of American Manganese, in reviewing 2015 as what may well be one of the worst years for the Canadian financial market.

Having posted the world’s third-worst decline, the Canadian financial market now has the dubious honor of having one of the world’s worst investment markets, a distinction it shares with “Europe’s economic basket case” Greece.

Reaugh and McGroarty argue that pointing the finger at the challenging overall climate in global resource market, which undoubtedly impacts Canada’s resource extraction-driven economy, captures only part of the issue. The underlying problem for Canadian companies, they say, is the end of the “uptick trading” rule – a financial market rule with a proven track record of restoring sanity for struggling markets.

Explain Reaugh and McGroarty:

“For reasons never fully explained to the public, regulators reacted to the aftermath of the 2008-09 financial meltdown by scrapping the uptick rule.

The change ushered in a kind of wild-west trading that no Canadian under 80 years old has seen in his or her lifetime. Here’s how it works. Speculators now don’t have to own a share of stock to sell short — they’re free to hit the bids with non-existent shares until the price crumbles. Eventually long-term shareholders feel pressed to sell, allowing the traders to cover their short position — pocketing investor money that could have gone to financing the company. And the company goes on life support without any regard to market fundamentals, or global demand for the resource in question.

The damage to the Canadian economy is considerable. Approximately 100,000 jobs have been lost directly and indirectly from the demise of the Venture Exchange — and who knows how many from the TSX itself?”

Pointing to the United States’ recent positive experience with at least partially reinstating the previously-ditched uptick rule in 2010 – a move that has helped the DOW climb significantly by over 7,500 points – Reaugh and McGroarty call on Canadian regulators to reinstate the rule for Canada so that the resource sector, and other key industries can unleash their full growth potential.

They say “Out with the old, in with the new” - for the sake of restoring market discipline to the resource sector, now would be a good time for Canadian regulators to reverse course and make reinstating the uptick rule their new year’s resolution for 2016.

The following post was originally published on InvestorIntel.com on August 16, 2013. It is reprinted with permission below. August 16, 2013 — Tracy Weslosky, Publisher of InvestorIntel interviews Daniel (Dan) McGroarty, Founder and President of Carmot Strategic Consultants in Washington, DC, and Founder and President of the American Resources Policy Network; an expert-led organization focused [...]

In a new piece for Forbes, American Resources Policy Network principal Daniel McGroarty discusses the EPA’s apparent readiness to unilaterally expand its powers under the Clean Water Act to pre-emptively veto a promising mining project in Alaska – the Pebble Mine. As McGroarty argues, if the EPA were to issue a veto based on its [...]

Testimony presented by Daniel McGroarty – Oversight Hearing of the U.S. House of Representatives Committee on Science, Space & Technology Subcommittee, August 1, 2013 Chairman Broun, Ranking Member Maffei, Members of the Committee: Thank you for the opportunity to testify today. My name is Daniel McGroarty, and I am president of the American Resources Policy [...]

Last week, American Resources principal Daniel McGroarty testified before the U.S. House of Representatives Committee on Natural Resources Sub-Committee on Energy and Mineral Resources on the issue of “America’s Mineral Resources: Creating Mining & Manufacturing Jobs and Securing America.” Commenting specifically on one of the bills pending in the committee, the ‘‘National Strategic and Critical [...]

In a letter to the editor of the Wall Street Journal, a reader from Arizona responds to American Resources Principal Daniel McGroarty’s op-ed “America’s Growing Minerals Deficit.” Citing Canada-based Augusta Resources’ Rosemont copper mine project in southern Arizona as an example, the reader alleges McGroarty “overlooks one very important consideration. There isn’t any assurance that [...]

American Resources Principal Daniel McGroarty will speak alongside fellow American Resources expert and Manager for Industrial Minerals Data, Simon Moores, at Industrial Minerals’ 2nd Graphite Conference 2012 in early December. In light of its traditional uses, its importance for the new Li-ion technology, and the ostensibly endless potential applications for the “new super material graphene,” [...]

If you haven’t lived under a rock lately (pun intended), you are probably aware of the fact that there is growing concern regarding the supply of mineral resources. While American Resources has consistently argued that the U.S. has subjected itself to a troubling degree of non-fuel mineral import dependency, which is often greater than our [...]

In his latest RealClear World column, American Resources principal Daniel McGroarty takes on the latest book in the “Jason Bourne series” – the “Bourne Dominion.” No, you’re not on the wrong blog – this is not a book club. The plot of the book actually involves a group of terrorists set on destroying the only [...]