URÁN – perspektívy uránu

Jedna z teórií hovorí, že práve rastúca globálna likvidita a apetít investorov majú za následok rast cien komodít. Dopyt vs ponuka pravdepodobne v tomto hrajú menšiu úlohu.

Napr. striebro bolo v deficite posledných 18 rokov a jeho cena začala stúpať až posledné 3 – 4 roky.


Perspectives on Uranium

We have learned that uranium is being consumed faster than it is being mined. This fact has been identified by many analysts at the main cause for the spectacular rise in its price. We also learned that the story of uranium is complex. Uranium is not a rare element and is available via many primary and secondary sources. There are immense untapped primary sources and the extent of global stockpiles is debatable. There are many options for nuclear power plants to feed their reactors and these alternatives are now becoming economically viable. According to industry sources, there is little danger of nuclear power plants running out of fuel under any foreseeable circumstances. If there really was uncertainty over fuel supply, nobody would be building billion-dollar new nuclear power plants. In short, the fundamentals give a mixed investment picture for uranium at this point in time.


It is true that a mine supply deficit is a bullish factor in uranium. But a mine supply deficit by itself does not in itself mandate a price increase. Silver had been in a structural mine supply deficit for decades before the price started to rise. It seems that in our finance-dominated marketplace, fundamentals are secondary to liquidity trends Global liquidity has been in an historic expansion since the market meltdown of 2000-2003. In a desperate attempt to recover from that meltdown, governments, central banks, and private financial institutions have loosened credit to the point that they created the conditions for extreme speculation. This historic tidal wave of global liquidity has given global investors both the means and the motive to bid up metals, energy, and almost all tangible assets. It is no coincidence that copper, nickel, zinc, lead, uranium, and almost all other metals are dramatically higher in price since 2003. Not all of these markets are in supply deficits. I contend that investor demand fueled by easy money is likely the primary driver behind the rise in industrial metals, not necessarily the condition of the physical markets.


Even though I just presented a fairly exhaustive fundamental analysis of a single commodity called uranium, I claim that fundamentals are not the dominant force behind the current bull markets in uranium and industrial metals. I chose uranium to analyze because it is actually a simpler market than copper or other multi-use metal. With uranium, we can see that a deep analysis can give a much different picture than a superficial investigation. But it does not matter in a finance-dominated market. The technicals rule in a finance-dominated market and the fundamentals are only a story used to justify technical market behavior. In this perspective, uranium an example of what can happen when an army of well-funded investors descend upon a small and vulnerable market.


It is my contention that a combination of extreme global liquidity creation and investor zealousness is pushing prices higher. So as long as those conditions persist, uranium and other industrial commodities will also continue to be strong. Should global liquidity contract or investors become spooked for some reason, all bets are off. Prices could fall regardless of the underlying supply/demand conditions.


As long as finance remains dominant over the economy, investor behavior will determine the pricing of industrial commodities and probably most other assets as well. At the time of this writing, I don't see compelling evidence of any imminent change in these conditions. In other words the trend will remain in place until it doesn't. This is not a cop-out, just an acknowledgement of our limited ability to forecast the future


But as investors we must anticipate likely future scenarios to exploit opportunities and manage risk. The best way to do this in a finance-dominated market is with technical analysis. TA is the most effective method of determining liquidity flows and investor behavior. There are many TA tools that can be employed. I think that the most powerful tool in this environment is inter-market analysis. If my assumption that the metals bull market is an artifact of global liquidity is correct, then trend changes should be reflected in all related markets. Metals investors should keep a sharp eye on both industrial commodity markets and global credit markets for clues to the future.


This implies that a source of concern for metals investors should be the condition of the global credit system. One of the prime sources of new liquidity is the mortgage security market. The explosion in mortgage credit is intertwined with the global real estate bubble. The real estate bubble is now in retreat. This will ultimately be reflected in the price of mortgage securities which is a multi-trillion dollar market. It is possible that a mortgage security market bust could cause investors to seek refuge in the much smaller hard asset market. If so, the prices of industrial metals, gold, and other commodities could soar even if bonds and stocks collapse. This is not a prediction, just a possible scenario. A mortgage security market bust could also take down commodities depending upon investor sentiment. Technical analysis will give the best indication of liquidity flows in all of these markets.


Source: SafeH

10.02.2007

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