Best of the Week
Most Popular
1.The Gallery of Crowd Behavior: Goodbye Stock Market All Time Highs - Doug_Wakefieldth
2.Tesco Meltdown Debt Default Risk Could Trigger a Financial Crisis in Early 2015 - Nadeem_Walayat
3.The Trend Every Nation on Earth Is Pouring Money Into - Keith Fitz-Gerald
4.Do Tumbling Buybacks Signal Another Stock Market Crash? - 26Mike_Whitney
5.Could Tesco Go Bust? How to Save Tesco from Debt Bankruptcy Risk - Nadeem_Walayat
6.Gold And Silver Price - Respect The Trend But Prepare For A Reversal - Michael_Noonan
7.U.S. Economy Faltering Momentum, Debt and Asset Bubbles - Lacy Hunt
8.Bullish Silver Stealth Buying - Zeal_LLC
9.Euro, USD, Gold and Stocks According to Chartology - Rambus_Chartology
10.Evidence of Another Even More Sweeping U.S. Housing Market Bust Already Starting to Appear - EWI
Last 5 days
More Downside Ahead for Gold and Silver - 31st Oct 14
QE Is Dead, Now You Tell Me What You Know - 31st Oct 14
Welcome to the World of Volatility - 31st Oct 14
Stocks Bear Market Crash Towards New All Time Highs as QE3 End Awaits QE4 Start - 31st Oct 14
US Mortgages, Risky Bisiness "Easy Money" - 30th Oct 14
Gold, Silver and Currency Wars - 30th Oct 14
How to Recognize a Stock Market “Bear Raid” on Wall Street - 30th Oct 14
U.S. Midterm Elections: Would a Republican Win Be Bullish for the Stock Market? - 30th Oct 14
Stock Market S&P Index MAP Wave Analysis Forecast - 30th Oct 14
Gold Price Declines Once Again As Expected - 30th Oct 14
Depression and the Economy of a Country - 30th Oct 14
Fed Ends QE? Greenspan Says Gold “Measurably” “Higher” In 5 Years - 30th Oct 14
Apocalypse Now Or Nirvana Next Week? - 30th Oct 14
Understanding Gold's Massive Impact on Fed Maneuvering - 30th Oct 14
Europe: Building a Banking Union - 30th Oct 14
The Colder War: How the Global Energy Trade Slipped From America's Grasp - 30th Oct 14
Don't Get Ruined by These 10 Popular Investment Myths (Part VIII) - 29th Oct 14
Flock of Black Swans Points to Imminent Stock Market Crash - 29th Oct 14
Bank of America's Mortgage Headaches - 29th Oct 14
Risk Management - Why I Run “Ultimate Trailing Stops” on All My Investments - 29th Oct 14
As the Eurozone Economy Stalls, China Cuts the Red Tape - 29th Oct 14
Stock Market Bubble Goes Pop - 29th Oct 14
Gold's Obituary - 29th Oct 14
A Medical Breakthrough Creating Stock Profits - 29th Oct 14
Greenspan: Gold Price Will Rise - 29th Oct 14
The Most Important Stock Market Chart on the Planet - 29th Oct 14
Mysterious Death od CEO Who Went Against the Petrodollar - 29th Oct 14
Hillary Clinton Could Be One of the Best U.S. Presidents Ever - 29th Oct 14
The Worst Advice Wall Street Ever Gave - 29th Oct 14
Bitcoin Price Narrow Range, Might Not Be for Long - 29th Oct 14
UKIP South Yorkshire PCC Election Win is Just Not Going to Happen - 29th Oct 14
Evidence of New U.S. Housing Market Real Estate Bust Starting to Appear - 28th Oct 14
Principle, Rigor and Execution Matter in U.S. Foreign Policy - 28th Oct 14
This Little Piggy Bent The Market - 28th Oct 14
Global Housing Markets - Don’t Buy A Home, You’ll Get Burned! - 28th Oct 14
U.S. Economic Snapshot - Strong Dollar Eating into corporate Profits - 28th Oct 14
Oliver Gross Says Peak Gold Is Here to Stay - 28th Oct 14
The Hedge Fund Rich List Infographic - 28th Oct 14
Does Gold Price Always Respond to Real Interest Rates? - 28th Oct 14
When Will Central Bank Morons Ever Learn? asks Albert Edwards at Societe General - 28th Oct 14
Functional Economics - Getting Your House in Order - 28th Oct 14
Humanity Accelerating to What Exactly? - 27th Oct 14
A Scary Story for Emerging Markets - 27th Oct 14
Could Tesco Go Bust? How to Save Tesco from Debt Bankruptcy Risk - 27th Oct 14
Europe Redefines Bank Stress Tests - 27th Oct 14
Stock Market Intermediate Correction Underway - 27th Oct 14
Why Do Banks Want Our Deposits? Hint: It’s Not to Make Loans - 26th Oct 14
Obamacare Is Not a Revolution, It Is Mere Evolution - 26th Oct 14
Do Tumbling Buybacks Signal Another Stock Market Crash? - 26th Oct 14
Has the FTSE Stock Market Index Put in a Major Top? - 26th Oct 14
Christmas In October – Desperate Measures - 26th Oct 14
Stock Market Primary IV Continues - 26th Oct 14
Gold And Silver Price - Respect The Trend But Prepare For A Reversal - 25th Oct 14
Ebola Has Nothing To Do With The Stock Market - 25th Oct 14
The Gallery of Crowd Behavior: Goodbye Stock Market All Time Highs - 25th Oct 14
Japanese Style Deflation Coming? Where? Fed Falling Behind the Curve? Which Way? - 25th Oct 14
Gold Price Rebounds but Gold Miners Struggle - 25th Oct 14
Stock Market Buy the Dip or Sell the Rally - 25th Oct 14
Get Ready for “Stupid Cheap” Stock Prices - 25th Oct 14
The Trend Every Nation on Earth Is Pouring Money Into - 25th Oct 14 - Keith Fitz-Gerald
Bitcoin Price Decline Stopped, Possibly Temporarily - 25th Oct 14

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Stocks Epic Bear Market

The Big Nuclear Energy Lie

Commodities / Nuclear Power Dec 12, 2012 - 12:15 PM GMT

By: DailyWealth

Commodities

Matt Badiali writes: What are the Japanese doing in Uzbekistan?

For natural resource investors, it's one of the most important questions in the world. The country is a major gold producer. It also produces large amounts of natural gas, cotton, and copper. But these days, Japan has little interest in the traditional commodities Uzbekistan has to offer.


The Japanese are in Uzbekistan because they need uranium...

That might surprise a few readers. Japan's Fukushima Daiichi nuclear disaster pushed the country to shut down its 50 nuclear reactors within weeks. The mainstream media reported Japan planned to swear off nuclear energy for good.

Several other countries followed suit, most notably Germany. Chancellor Angela Merkel shut down all of Germany's nuclear power plants, instantly removing 41% of Germany's electric power.

But that's not the end of the story. And if you dig through the hysteria and government misinformation and look at the facts, you'll find a big investment opportunity...

You see, once again, basic economics is overriding political speechmaking. Let me explain...

Coal is the world's most important fuel for power generation... accounting for 40% of the electricity generated in 2010 (the most recent full-year data available)... Natural gas comes in next at 21% (and rising). Hydropower generates 16%, barely ahead of nuclear at 13%.

Global demand for electric power totaled 22,018 terawatt hours (TwH) in 2010, according to the International Energy Agency (IEA) World Energy Outlook 2012. Depending on policy changes, economic development rates, and population growth over the next 25 years, the study predicts an increase in electrical consumption between 48% and 88%.

Government policies will drive development of the various fuels. But in any scenario you choose, nuclear power plays a prominent role.

In 2010, nuclear power produced 2,756 TwH of electricity. Depending on the scenario used, the IEA projects nuclear power growth between 42% and 117% over the next 25 years. That would put production between about 4,000 TwH and 6,000 TwH.

That is a significant underestimation.

This study accepts at face value governments' fanciful projection of renewable energy, which would reduce the role of nuclear power. In the most aggressive scenario, the study shows non-hydro renewable power accounting for 9,031 TwH in 2025. That's much more than nuclear and nearly 12 times the power production by renewables in 2010. That is a ridiculous assumption. And I believe, in real life, that nuclear power will be tapped to fill much more of that production than in this estimate.

Here's why...

The following table displays the costs of various sources of electric power in U.S. cents per kilowatt hour (KwH). Nuclear power is the cheapest source of electricity.

Further complicating Japan and Germany's anti-nuclear stance... both countries are aggressively trying to restrict the use of fossil fuels, like coal, to reduce carbon-dioxide production. (We'll leave the folly of that endeavor for another day.)

If you abandon nuclear fuel and coal... you're left with limited and expensive options...

"Renewable" energy sources are popular to discuss, but the only viable one is hydroelectric power. And as the table shows, it's more than four times as expensive to operate as a nuclear power plant. Wind and solar are unproven as mainstay sources of power for a national power grid... and are incredibly expensive to build and maintain.

Add to that... the demand for electricity is growing fastest in places that don't have the luxury of experimenting with fads and theories...

The IEA and oil major BP both put out highly regarded annual energy forecasts. And according to both analyses, electricity demand represents the largest growth of any energy sector. World electricity demand is projected to grow between 2.2% and 2.6% per year through 2030, according to the two major forecasts. And as you would expect, the main sources of growth are the immense and modernizing economies of China (38%) and India (13%).

One of the cheapest, cleanest options for these countries is nuclear power. There's just no way the world can work without nuclear energy playing a prominent role... no matter what the politicians say.

That's why Japan is in Uzbekistan looking for uranium. Just a few months ago, Japan Oil, Gas, and Metals National Corporation – the government agency responsible for creating stable supplies of key resources – closed a deal to help fund the exploration and production of large uranium deposits in central Uzbekistan.

This is not the action of a country ready to give up on nuclear power. It's the action of a country that's saying one thing and doing another. And that's why there's a big opportunity here for investors.

In my next essay, I'll show you another major factor that will help kick off a bull market in uranium and uranium producers.

Until then...

Good investing,

Matt Badiali

P.S. Last week, I told my S&A Resource Report subscribers about my three favorite ways to profit off the opportunity in uranium. These companies are so beaten-down that we won't risk more than 12.5% on any of them... and our potential gains are as much as 300% if they simply recover to their pre-Fukushima prices. You can gain immediate access to these picks with a subscription to the S&A Resource Report. Learn more here.

http://www.dailywealth.com

The DailyWealth Investment Philosophy: In a nutshell, my investment philosophy is this: Buy things of extraordinary value at a time when nobody else wants them. Then sell when people are willing to pay any price. You see, at DailyWealth, we believe most investors take way too much risk. Our mission is to show you how to avoid risky investments, and how to avoid what the average investor is doing. I believe that you can make a lot of money – and do it safely – by simply doing the opposite of what is most popular.

Customer Service: 1-888-261-2693 – Copyright 2011 Stansberry & Associates Investment Research. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This e-letter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of Stansberry & Associates Investment Research, LLC. 1217 Saint Paul Street, Baltimore MD 21202

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Daily Wealth Archive

© 2005-2014 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Free Report - Financial Markets 2014