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Monday
Oct132014

Rick Rule: Are the Worst of Times Yet to Come?

“I plan on using this recording a few years from now as marketing material,” said Rick, speakingto current clients and friends of Sprott Global Resource Investments Ltd., the firm he founded in 1994. “What I’m going to talk about today I think will seem like a prescient market call three or four years from now.”

His recent update was about putting the ‘carnage’ and heavy damage to people’s natural resources portfolio over the last two years, and acutely in the last couple of weeks, in perspective.

“It’s times like these that you’ll look back on as the ‘good old days,’” Rick suggests. “In 2017 or 2018, I believe we will think of 2014 as the days when you could buy companies with the most compelling projects and management teams at 75 percent discounts from their previous highs. ‘Back then, we could see a company fall 30 percent after they refused to take money from us in a private placement, and we could buy the stock at even more attractive terms,’ we’ll say.

“We have all had the experience of seeing goods on sale and procrastinating, and later on seeing them priced much higher. You think to yourself ‘I really wish I’d participated.’ Those are the kinds of times that get referred to as ‘the good old days.’”

Right now, it feels like we couldn’t be done with good old days soon enough. As Rick puts it, “You are either a contrarian or a victim, I’ve often said. Sometimes, it’s possible to be both.” Right now certainly feels like one of those times.

That’s no reason to give up on your contrarian investments, according to Rick. If you were correct in your initial assessment, and the goods you bought were indeed ‘on sale,’ then the right thing to do is to hang on.

As Rick explains, this is what made his fortune during the last period of ‘good old days’ for the resource sector – the profound bear market of the 1998 to 2001 period. He checked his reasoning for investing in the companies he owned, and decided he’d made the right choice.

Rick tells the story: “Companies in the resource sector were in a once-in-a-decade sale at the end of the 90’s. There was one commodity in particular, uranium, which had been in a 20-year bear market. The price had gone from 32 dollars to 8 dollars a pound. Not only did people lose money, but, to make things worse, it was a despised material. It was perceived as having cost people their lives at Hiroshima, Nagasaki, or Three Mile Island. The commodity had underperformed so bad that the margins on producing it were now negative.

“There was one Australian company at the time, called Paladin, which owned a uranium mine. The bear market for resources was even more severe in Australia than it was in Canada.

“In 1998, I realized that uranium was a spectacular contrarian investment. Nuclear power made up 16% of the world’s energy. As long as the Western world continued to want to have electricity, the price would have to go up, or the lights would go out. I had decided that Paladin was a highly speculative bet on that outcome.


“I financed them at 10 cents, and the stock rose a little. I financed them again at 12 cents. Then, things got ugly.

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Sunday
Oct052014

Austria says will sue if EU regulator clears UK nuclear plant plan

(Reuters) - Austria will take the European Commission to the European Court of Justice (ECJ) if it approves Britain's plans for a 16 billion-pound nuclear power plant, a spokesman for the chancellor said on Sunday.

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Thursday
Oct022014

Bolivia to kick off nuclear energy program in 2014

President Evo Morales said Thursday that Bolivia will launch its civilian nuclear energy program this year, a project that will include the construction of plants in the western province of La Paz and an investment outlay of more than $2 billion through 2025.

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Wednesday
Oct012014

U.N. Leaders Must Include Nuclear Energy In Action Plan On Climate Change

All eyes are on New York City this week, as world leaders come together for the U.N. Climate Summit – an event that aspires to shape the national and global energy future. The U.N. Climate Summit will build global partnerships among representatives from business, science, advocacy and government sectors. These partnerships will take action on an essential plan to reduce carbon pollution and address global climate change.  This plan must include realistic actions that take us toward sustainable energy solutions,

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Monday
Sep292014

Time to buy uranium? The best ways to play it

 Chart courtesy of u308.biz

Patience could finally start to pay off for investors waiting for a revival of the uranium market that imploded in the aftermath of Japan’s nuclear disaster in 2011.

After the spot price hit a nine-year low of $28 (U.S.) this spring on oversupply concerns, dragging uranium equities down with it, many investors believe the commodity used to fuel nuclear power plants has finally hit bottom, as the demand picture brightens.

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Thursday
Sep252014

Denison Mines Excites Analysts with Gryphon Zone Extension

A summer of good news has continued into the fall for Denison Mines (TSX:DML,NYSE:DNN). On Wednesday the company announced that it has extended the Gryphon Zone of its Wheeler River property and has concluded its 2014 summer drilling programs at Wheeler River, Crawford Lake and Bachman Lake.

Denison has now drilled a total of 14,397 meters in 20 holes in the Gryphon Zone. The Gryphon Zone measures 350 meters by 60 meters,

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Thursday
Sep182014

Nuclear energy must be part of climate change strategy

As a former governor, I am familiar with the challenge of balancing the immediate electricity and heating needs of our citizens with the long-term priority of ensuring that power comes from a diverse mix of energy sources that allows us flexibility as we fight the effects of climate change.

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Monday
Sep152014

Why ECB QE Is Bearish For Gold Prices

The recent action by the ECB appears to have caught many gold bulls off guard. A common interpretation of the impact that a potential quantitative easing program would have on gold prices was that it would be very bullish. This argument was based on the concept that money printing is bullish for gold, and that QE1 and QE2 by the Fed triggered major rallies in the yellow metal. Whilst we do not dispute that QE1 and QE2 by the Fed were indeed bullish for gold, we strongly disagreed that the ECB would introduce a program that would spark a major rally. In fact we went further, predicting that what the ECB was going to do was in fact highly bearish for gold, and in this article we will endeavour to explain why.

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Wednesday
Sep102014

Rick Rule - Takedowns In Gold, Silver & Oil To End Badly For Bears

Despite the title of this post Uranium does get a mention:

Today one of the wealthiest people in the financial world told King World News that the take downs in the gold, silver, oil, and uranium markets will end badly for the bears.  Rick Rule, who is business partners with Eric Sprott, also discussed why he is so incredibly bullish on the metals and energy.

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Monday
Sep082014

Saudi Arabia Fast-Tracks Nuclear Power

Last Tuesday, energy officials in Saudi Arabia announced plans to become a major nuclear energy state, assuring the reactors would be used only for peaceful purposes (The Nuclear Wire). They intend to move fast, beginning construction by year’s end.

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