Why I fled my home office this morning…

Tuesday, 19 February 2019
Adelaide, Australia
By Bernd Struben

  • Powering the 21st Century
  • 1,243% gains…in six months?
  • ‘Treason! Trump Goes on Offensive Over Russia Probe’

We don’t appreciate what we have until it’s gone. Freedom is like that. It’s like air. When you have it, you don’t notice it.

Boris Yeltsin

I spent much of this morning thinking about electricity.

Why?

Because I don’t have any. Which is why I opened with the quote from Boris Yeltsin, the first Russian president following the collapse of the Soviet Union.

Like freedom, electricity is something we take for granted in Australia. Even if we pay a pretty penny for it.

When you have electricity, you don’t really notice how critical it is to almost every activity in your house.

It’s more than just the lights and television. And more than just the dishwasher and washing machine.

Without electricity you lose your internet, your climate controls, your hot water, your ability to charge your phone or laptop, or zap food in your microwave…

Depending on your water source you may not be able to flush your toilet or wash your hands. And if it’s out long enough you can kiss the perishables in your refrigerator goodbye.

Fortunately, my power won’t be offline that long. And fortunately, I knew the electricity would be shut off in advance.

Apparently the company is working to ‘improve my service’. For the second time in as many weeks.

So I’m writing to you today from the local library, where the lights are on and the internet is working.

Which has all gotten me thinking about the huge surge in power demand facing the world over the coming years.

And the lucrative investment opportunities this presents to early investors.

We’ll get back to that, right after a look at the markets.

(If you’re the impatient type, you can click here for Greg’s top three energy stocks now.)

Markets

US markets were closed on Monday, overnight our time, for President’s Day holiday.

In Europe, the Euro Stoxx 50 index finished up 3.54 points, or 0.11%. Meanwhile, the FTSE 100 fell 0.24%, and Germany’s DAX closed down 0.06 points, or 0.01%.

In Asian markets, Japan’s Nikkei 225 is up 7.31 points, or 0.03%. China’s CSI 300 is up 0.18%.

In Australia, the S&P/ASX 200 is up 24.27 points, or 0.40%.

On the commodities markets, West Texas Intermediate crude oil is US$55.91 per barrel. Brent crude is US$66.50 per barrel.

That puts Brent at a three-month high.

Oil’s gotten a boost lately from growing hopes the US-China trade dispute is winding down. That should see stronger global demand based on stronger international trade.

Reports of Chinese credit growth have also soothed fears that energy demand in the world’s second largest economy could fall.

Ah, debt. What would we do without you?

But the Saudis deserve much of the credit for ending crude’s deep slide. They’ve even signalled they could cut output by more than agreed on during the last OPEC+ meeting. The Saudis want to see Brent trading at US$80.

That could happen. But I wouldn’t hold my breath.

Don’t forget that US oil production remains at record levels…and growing. And the higher the oil price goes, the more attractive it becomes for US drillers to ramp up production even further. This should see WTI exports drag on the price of Brent.

From Bloomberg:

India’s biggest refiner signed its first annual contract to buy 2 million tons of U.S. crude for the year starting April, according to a statement from Indian Oil Corp. on Monday. A weakening performance of West Texas Intermediate against other global markers, Brent and Dubai, is making U.S. crude shipments more competitive.

Turning to gold, the yellow metal is trading for US$1,326.53 (AU$1,860.23) per troy ounce. Silver is US$15.81 (AU$22.17) per troy ounce.

One bitcoin is worth US$3,892.84. That’s an 8.3% rise in the price of the world’s largest cryptocurrency since this time yesterday.

What’s next for bitcoin? You can get all the latest crypto investment advice here.

In the world of fiat currencies, the Aussie dollar is worth 71.31 US cents.

Powering the 21st Century

Getting back to the ever-growing global demand for electricity, even if per capita energy demand remains the same — it won’t — there are a lot more people coming to this world.

How many?

According to UN estimates, the Earth will be home to another billion people within 15 years. By 2050 we can expect another billion atop that, bringing our numbers up to 9.7 billion from today’s 7.7 billion.

That alone will see a big rise in energy demand.

Even more importantly is the growing wealth in nations like India and China. As people get wealthier they want larger houses complete with all the mod cons. And those require access to reliable electricity.

China is already in a race to provide that demand without further eroding the deplorable air quality in its major cities.

They’re even looking to space. As Bloomberg reports:

China is preparing to build a solar power station in space, as the world’s No. 2 economy strives to burnish its superpower credentials…

Scientists have already started construction of an experimental base in the western Chinese city Chongqing. Initially, they plan to develop a smaller power station in the stratosphere between 2021 and 2025, a 1 megawatt-level solar facility in space by 2030, and eventually larger generators, according to the state-backed Science and Technology Daily.

Now you’ve got to laud the Chinese for their innovation here. And for helping push the US and Western nations into upping their own game in space.

But as novel as a space based 1 megawatt solar plant will be, it wouldn’t even power a single suburb in Beijing. Australians, for example, demand about 45,000 megawatts per year, according to the Australian Energy Regulator.

With coal’s long-term future looking dim, and space energy mostly a high profile exercise in international PR, how will the world meet the booming demand for reliable, affordable energy?

While solar, tidal, and wind power will make up some of that supply, there’s another electricity source set to see a surge in demand. At the same time as its facing a supply crunch.

Now extracting energy from this commodity is nothing new. In fact, it first started powering cities more than 70 years ago before falling out of favour later in the 20th Century.

But with the world focused on cutting carbon emissions, interest is reviving…fast.

I’m talking about uranium, of course. And as Greg Canavan explains in this research report, uranium is looking to make a huge comeback.

1,243% gains…in six months?

I’ve known Greg for almost six years.

For several of those years we shared an office at Port Phillip Publishing’s HQ in Albert Park, just outside of Melbourne.

Over all those years, Greg’s investment track record is among the best — if not the best — of all of our editors and analysts. And with the quality of our investment team, that’s saying quite a lot.

One thing Greg generally shies away from is making speculative recommendations. The kind that can see you make 500% gains in less than a year…or lose 90% of your money just as quickly.

But when he dug into the uranium story and uncovered the sky-high potential of three Aussie listed uranium stocks, Greg made a rare exception.

Here’s what he has to say about them:

No doubt, these are three of the wildest ASX speculations I’ve recommended in my 20-year career.

If these three Aussie uranium punts don’t pan out…you could lose money here. But if they do pay-off, you could make gains in the order of 282%…right up 1,243%.

That’s short term. Inside the next 6–12 months.

If the uranium story really picks up steam, you could even triple those numbers.

Those are some big numbers, to be sure. And as Greg points out, there are no guarantees. These kinds of speculative investments come with a good dose of risk.

So, what makes Greg confident enough to recommend these stocks?

Like I mentioned above, the uranium supply is coming under pressure.

As Greg writes in his report, ‘one of the world’s biggest uranium producers is about to shut down its largest mine. And with it 24,000 tonnes of uranium are about to disappear. That’s 16% of global supply we’re talking about.’

At the same time demand for uranium is growing.

Greg notes that there are 57 nuclear reactors under construction across the world and 154 planned.

19 of those reactors are in China, who apparently aren’t ready to wait for the space based energy market to become viable.

In fact, the Chinese government has allocated $2.4 trillion to expand its nuclear power generation by 6,600%.

Japan, Russia, India, and the US are also investing billions in new research and development.

As Greg notes:

The last time uranium markets looked this sweet was over a decade ago, in 2006. You could have made a tasty profit just by betting on the uranium spot price. In less than a year uranium prices spiked 278%.’

You can see that historic spike in the graph below:



chart image

Source: Index Mundi
Click to enlarge

But as with gold and oil — and almost every commodity — for the really big gains you want to invest in the miners and producers. Their share prices are highly leveraged to the price of the underpinning commodity. Meaning if the commodity doubles in price, their stock can go far higher.

Greg points out that during the previous uranium price boom:

Between December 2005 and April 2007, shares in Aussie uranium player, Paladin Energy climbed 508%. Between 18 December 2005 and 8 April 2007, US-based uranium outfit Energy Fuels soared 7,542%.

Intrigued? I was.

You can get the full uranium story and the three stocks Greg thinks could shoot the lights out by clicking here.

Finally, don’t forget to check out the latest in political backstabbing from The Australian Tribune:

‘Treason! Trump Goes on Offensive Over Russia Probe’

There are few charges as grave as treason. And for good reason.

Acting against your nation is akin to acting against your family.

In the US, a conviction can see you jailed for life. Or face the firing squad.

That fate may not befall several key officials who were involved in the probe attempting to portray US President Donald Trump as…

If you’re fed up with sanitised, politically correct dogma cut and pasted from one mainstream source to another then The Australian Tribune is for you.

And it’s absolutely free.

Sign up here to get The Australian Tribune delivered free to your inbox five days per week.

You can visit our website at https://www.theaustraliantribune.com.au/ to read the complete article above now.

Cheers,
Bernd