canada is watching closely!

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    There are many in Canada who are amazed at how long and slow the uranium rush has started here. they had theirs last year with many stocks doing 200-300% in 12 months. Spectacular stuff! I am very bullish about this sector for a number of reasons:
    1. If energy prices continue north, uranium will follow. Even with the comebacks in the oil price, uranium prices have still surged ahead!
    2. You have good stocks here in Australia with defined resources so they will make money one day and more than likely a lot of it. Eg Summit depending on U prices @ $US21/lb there uranium is worth A$2.045 billion. @ $US30/lb make that $2.92 billion! Laramide's Westmoreland. Rio's Kintyre. Paladin's Manyingee. Maple's Ben Lamond etc etc.
    3. If a global recession ever hit, these stocks will fall the least as energy demand is the least elastic of all consumables demand barring food.
    4. If oil prices crippled global growth, uranium prices would continue to strengthen. This is a real risk! A single camel with a backpack of plastic explosive can cause severe disruptions to oil supplies in say Iraq! Terrorist calls have been voiced to target oil infrastructure and make infidels pay at the bowser. That is the best way to hurt the West. Smart people these lunatics!
    5. There has been no rationlisation in the sector largely. In fact the opposite happened when U prices dipped around $US7/lb. Big companies offloaded uranium reserves to junior miners because they could make better money elsewhere. So a lot of smaller companies hold good little minesites that the big boys will surely be eyeing now. Make no mistake, Xstrata's bid for WMR is entirely over uranium! The govt should block this and let our shares realise their full value in a couple of years time just as Woodside has!
    6. Safest capacity to double a portfolio's worth in a year.
    7. Environmental benefits over fossil fuels.

    So think about your portfolio carefully and if the stocks you hold are sensitive to high oil prices, then I would suggest you either reduce their weighting or opposingly counter this energy risk with an equal investment in safe energy stocks such as uranium miners. Food for thought! Healthy to be challenged!
 
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