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The Nuclear Option

The Nuclear Option

By Marin Katusa, Chief Investment Strategist, Casey’s Energy Opportunities 

Earlier this year, the Obama administration announced large new federal loan guarantees for the nuclear energy industry – totaling about $54 billion, or more than triple the current level of funding. Philosophically, we abhor government subsidies to any industry, but we also recognize that they’re a fact of life these days, with an inordinate influence on markets. So even though we’d prefer the government didn’t pick industry winners and losers, we must be mindful of what Washington is doing if we expect to reap profits as investors. 

In this instance, the ramping up of government support means boom times are coming for the nuclear energy industry, which is about to awaken from a three-decade long sleep. And if you correctly position your energy investment portfolio, you can benefit from a comeback that’s baked in the cake. 

Power is all about the numbers. Consider the illustration below, which shows how current electricity generation technologies stack up when it comes to producing energy (cost is in dollars per megawatt hour). Solar and wind generators are not cheap and don’t work when it’s dark or calm. They’re competitive only with heavy government subsidies and even then, will never contribute much juice to the grid. 

Source: EIA. Adapted from http://www.investingdaily.com/tes/17201/sell-wind-and-solar-energy-stocks.html 

Hydro, biomass, and geothermal fare much better, easily competing with more traditional technologies, and there are good investment opportunities among them that we’re following. But again, in the larger picture they’re minor players. 

In terms of bang for the buck, it still comes down to coal, gas and nuclear, and Washington realizes we’re going to need all three to meet our future energy needs, especially as electric vehicles begin to replace those that run on gasoline. 

The Obama administration is all for going as “green” as possible, but realizes that wind and solar are not going to cut it. Thus, after thirty years in the doghouse, the nuclear option has regained the respectability in America that it enjoys among nations such as China, where ten new plants per year are proposed (our last new construction project broke ground in 1977). 

Despite lingering doubts among those who remember Three Mile Island, uranium has been dusted off and presented to the public as a safe, environmentally friendly, cost-effective source of power. And the new generation of plants is all of those…
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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743"

Thank you for you time!

 
 

Phil's Favorites

Expect higher treasury yields in second half

Expect higher treasury yields in second half

Courtesy of Sober Look

While many investors refuse to accept this fact, we are clearly marching toward higher treasury yields later in the year and in 2015. Even after today's bond selloff, we are still around the yield levels we had during the dark days of the government shutdown. Here are a couple of key factors that will drive yields higher from here.

1. Many are pointing to record low yields in Europe (see chart), suggesting that on a relative basis treasuries look attractive. Perhaps. But it's important to make that comparison based o...



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Zero Hedge

Russia And Germany Allegedly Working On Secret "Gas For Land" Deal

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

While many were amused by this photo of Putin and Merkel during the world cup final showing Europe's two most important leaders siding side by side, some were more curious by just what the two were scheming:

 

Thanks to the Independent, we may know the answer, and it is a doozy, because according to some it is nothing shy of a sequel to the ...



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Insider Scoop

Warren Resources Enters Marcellus with Citrus Asset Buy - Analyst Blog

Courtesy of Benzinga.

Independent energy company, Warren Resources, Inc. (NASDAQ: WRES) announced that it has acquired certain assets in Pennsylvania's Marcellus Shale from Colorado-based oil and natural gas producer, Citrus Energy Corporation and two other parties that owned working interest in the region. The transaction, which marks Warren Resources' entry into the prolific natural gas basin, was for a purchase price of $352.5 million.

Following this announcement, shares of Warren Resources gained around 2.6% to close at $6.30. Shares also touched an intraday high of $6.70 that marked a new 52-week high for the stock.

The company mentioned that it will issue $40 million in shares at $6.00 per share as part of the transaction cost. The...



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Chart School

3 Things Worth Thinking About (Volume 2)

Courtesy of Doug Short.

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.

Last week, I started a new weekly series entitled "3 Things Worth Thinking About". The focus here will be three things, ironically enough, that are worth considering with respect to your portfolio and related investments. As I have discussed many times previously, focusing only on "bullish" commentary when markets are rising is really of little use as it creates a "blind spot" to related investment risks. The same goes for when markets are falling. These cognitive biases get in the way of making logical and disciplined investment decisions to not only garner returns when markets rise, but avoid depletion of capital when they don't.

I hope you will...



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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Option Review

Kellogg Call Options Active Ahead Of Earnings

Shares in packaged foods producer Kellogg Co. (Ticker: K) are in positive territory on Monday afternoon, trading up by roughly 0.20% at $65.48 as of 2:20 p.m. ET. Options volume on the stock is well above average levels today, with around 12,500 contracts traded on the name versus an average daily reading of around 1,700 contracts. Most of the volume is concentrated in September expiry calls, perhaps ahead of the company’s second-quarter earnings report set for release ahead of the opening bell on Thursday. Time and sales data suggests traders are snapping up calls at the Sep 67.5, 70.0 and 72.5 strikes. Volume is heaviest in the Sep 72.5 strike calls, with around 4,600 contracts traded against sizable open interest of approximately 11,800 contracts. It looks like traders paid an average premium of $0.37 per contrac...



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Sabrient

Sector Detector: Bold bulls dare meek bears to take another crack

Courtesy of Sabrient Systems and Gradient Analytics

Once again, stocks have shown some inkling of weakness. But every other time for almost three years running, the bears have failed to pile on and get a real correction in gear. Will this time be different? Bulls are almost daring them to try it, putting forth their best Dirty Harry impression: “Go ahead, make my day.” Despite weak or neutral charts and moderately bullish (at best) sector rankings, the trend is definitely on the side of the bulls, not to mention the bears’ neurotic skittishness about emerging into the sunlight.

In this weekly update, I give my view of the current market environment, offer a technical analysis of the S&P 500 chart, review our weekly fundamentals-based SectorCast rankings of the ten U.S. business sectors, and then offer up some actionable trading ideas, incl...



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OpTrader

Swing trading portfolio - week of July 28th, 2014

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW in the comments below each post. 

Our weekly newsletter Stock World Weekly is ready for your enjoyment.

Read about the week ahead, trade ideas from Phil, and more. Please click here and sign in with your PSW user name and password. Or take a free trial.

We appreciate your feedback--please let us know what you think in the comment section below.  

...

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Digital Currencies

BitLicense Part 1 - Can Poorly Thought Out Regulation Drive the US Economy Back into the Dark Ages?

Courtesy of Reggie Middleton.

An Op-Ed piece penned by Veritaseum Chief Contracts Officer, Matt Bogosian

This past weekend (despite American Airlines' best efforts), Reggie and I made it to the Second Annual North American Bitcoin Conference in Chicago. While there were some very creative (and very ambitious) ideas on how to try to realize the disruptive Bitcoin protocol, one of the predominant topics of discussion was New York Superintendent of Financial Services Benjamin Lawsky's proposed Bitcoin regulations (the BitLicense proposal) - percieved by many participants at the event as an apparent ...



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Market Shadows

Danger: Falling Prices

Danger: Falling Prices

By Dr. Paul Price of Market Shadows

 

We tried holding up stock prices but couldn’t get the job done. Market Shadows’ Virtual Value Portfolio dipped by 2% during the week but still holds on to a market-beating 8.45% gain YTD. There was no escaping the downdraft after a major Portuguese bank failed. Of all the triggers for a large selloff, I’d guess the Portuguese bank failure was pretty far down most people's list of "things to worry about." 

All three major indices gave up some ground with the Nasdaq composite taking the hardest hi...



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Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



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Promotions

See Live Demo Of This Google-Like Trade Algorithm

I just wanted to be sure you saw this.  There’s a ‘live’ training webinar this Thursday, March 27th at Noon or 9:00 pm ET.

If GOOGLE, the NSA, and Steve Jobs all got together in a room with the task of building a tremendously accurate trading algorithm… it wouldn’t just be any ordinary system… it’d be the greatest trading algorithm in the world.

Well, I hate to break it to you though… they never got around to building it, but my friends at Market Tamer did.

Follow this link to register for their training webinar where they’ll demonstrate the tested and proven Algorithm powered by the same technological principles that have made GOOGLE the #1 search engine on the planet!

And get this…had you done nothing b...



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