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Jim Cramer Talks Bond Yields, Trade and What Rare Earth Minerals Mean for Tesla

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Happy hump day.

Jim Cramer takes a look at the declining bond yields, which he also tackled in his Real Money column from Wednesday morning. He also looks at China's move to possibly weaponize its rare earth dominance. The different materials help to build applications from smartphones to wind turbines to electric vehicles, which leads Cramer into why Tesla (TSLA) is Real Money's stock of the day. 

The Sinking Bond Yields

The Treasury bond yield is inching towards 2%.

Cramer tackled the sinking bonds in his morning column on Real Money

Cramer said that he believes that the reason for the decline is the lack of demand, not the tariffs. 

And, here's why:

Taking the foreign money off the table leaves you with a belief that the strong dollar and the yield differential mean nothing, even though you have to believe that there is as least some part of this incredible rally fueled by foreigners.

Which leaves, of course, a lack of demand. There simply isn't belief in the future, no matter what, to warrant borrowing -- and that's the real reason for the decline.

So, why does Cramer think that the tariffs aren't impacting the bond yields? He digs in. 

Even More Trade Headlines

There were more trade headlines in the markets early Wednesday morning. 

China may be making moves to ban the export of rare earth materials. 

"Will rare earths become a counter weapon for China to hit back against the pressure the United States has put on for no reason at all? The answer is no mystery," wrote the People's Daily, a Chinese newspaper. 

The article then used the Chinese phrase "don't say I didn't warn you," which is most commonly used as a military phrase.

Did the market expect this kind of response out of China? Cramer weighs in. 

Why Tesla Is Impacted By Rare Earths

Real Money Stock of the Day Tesla is back in the headlines again after the possible ban on rare earths. 


Well, rare earth materials from China help to make wind turbines, smartphones, and, of course, electric vehicles. 

Tesla's battery is made of cobalt, which is imported from China. 

So, investors--and Elon Musk--should be taking a look at the possible risk that the ban creates. 

More importantly, did Elon Musk anticipate this risk? Here's what Cramer thinks.

Related. Jim Cramer: Sinking Bond Yields Disguise the Real Reason for the Decline

Watch Jim Cramer's Daily NYSE Show and Replays Below

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