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President Trump and Chinese Vice Premier Liu He talk to reporters in the Oval Office. Photo: Chip Somodevilla/Getty Images

Rare earth minerals and elements are necessary components of tech and defense tools, including smartphones, LED lights, wind turbines and nuclear rods. And their critical role in modern manufacturing has turned them into the latest lightning rod in the trade war between China and the U.S.

Driving the news: After President Trump blacklisted Chinese tech company Huawei and threatened to target other Chinese tech firms by disallowing American companies to do business with them, China signaled it could target rare earth minerals.

  • Chinese President Xi Jinping recently visited a key rare earth minerals area of China, analysts say as a symbolic show of force of what the U.S. has to lose if Trump pushes forward with blacklisting.
  • Though the U.S. does have rare earth minerals, the process of mining and refining them is difficult and environmentally dangerous (sometimes releasing radioactivity), so very few domestic facilities exist.

Why it matters: Pushing beyond tariffs and into outright restrictions on trade and international cooperation would take the trade war to a new and more damaging level for individual companies and the stock market.

The big picture: Critics have argued the trade war has been a blessing for China because it has re-focused its business and political leaders on parts of the economy where it is reliant on the U.S. A roadblock on rare earths could prove a similar jolt for American businesses that have long depended on China for essential materials to make their products.

  • This month, a bill was proposed in the Senate that could help spur mining of U.S. rare earth elements and other similar minerals.
  • Enter Blue Line and Lynas Corp, 2 companies hoping to make rare earth mining in America great again by building a plant in Hondo, Texas.

Yes, but: While Trump has been looking to bolster U.S. economic independence, moving away from China will not be easy. As with many industries, China has built an intricate supply chain and has a number of competitive advantages in rare earth mining and export.

  • One big reason Lynas is likely looking to move to the U.S. is its fight with the Malaysian government over environmental conditions and an attempt to force the company to pay for clean-up of a radioactive substance produced in the rare earth mining process.
  • Trump's latest $16 billion farm aid package to farmers show he is willing to spend government money to compensate for trade war casualties, but his ability to further crimp American environmental protection standards may be limited.

Go deeper ... OECD: U.S.-China trade war puts global economy "in a dangerous place"

Go deeper

Woman who allegedly stole laptop from Pelosi's office to sell to Russia is arrested

Photo: FBI

A woman accused of breaching the Capitol and planning to sell to Russia a laptop or hard drive she allegedly stole from Speaker Nancy Pelosi's office was arrested in Pennsylvania's Middle District Monday, the Department of Justice said.

Driving the news: Riley June Williams, 22, is charged with illegally entering the Capitol as well as violent entry and disorderly conduct. She has not been charged over the laptop allegation and the case remains under investigation, per the DOJ.

Biden will reverse Trump's attempt to lift COVID-related travel restrictions

Photo: Tasos Katopodis via Getty

The incoming Biden administration will reverse President Trump's last-minute order to lift COVID-19 related travel restrictions, Jen Psaki, the incoming White House press secretary, tweeted.

Why it matters: President Trump ordered entry bans lifted for travelers from the U.K., Ireland, Brazil and much of Europe to go into effect Jan. 26, but the Biden administration will "strengthen public health measures around international travel in order to further mitigate the spread of COVID-19," Jen Psaki said. Biden will be inaugurated on Wednesday, Jan. 20 and Trump will no longer be president by the time the order is set to go into effect.

Dominion sends cease and desist letter to My Pillow CEO Mike Lindell

Photo: Stephen Maturen/Getty Images

Dominion Voting Systems on Monday sent a cease and desist letter to My Pillow CEO Mike Lindell over his spread of misinformation related to the 2020 election.

Why it matters: Trump and several of his allies have pushed false conspiracy theories about the company, leading Dominion to take legal action. It's suing pro-Trump lawyer Sidney Powell for defamation and $1.3 billion in damages, and a Dominion employee has sued Trump himself, OANN and Newsmax.

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