Gold and Nuclear Power Are White-Hot Now

It’s not an “I told you so” moment, but just a confirmation of the power of patience. If you invested in gold and uranium assets years ago, you’d be doing well today. However, there are still more gains ahead of us than behind us.

The signs were there for gold, no doubt. The Federal Reserve couldn’t keep interest rates high for much longer. After all, it’s an election year and besides, the government can’t afford to pay its massive debt interest at high rates.

I’m not in the business of trying to time the exact moment when gold or uranium will soar. I’ll leave that to the short-term traders. Rather, I’ve been discussing a “be right and sit tight” strategy for gold and for uranium; the big price move was bound to happen sooner or later.

Courtesy: @IGWTReport

The gains for gold, however, didn’t just start with the Federal Reserve’s recent “jumbo” 50-basis-point interest-rate cut. The “gold rush” has been in effect for a while now, and I believe we’re in for another amazing multi-year rally like we saw in 2002 through 2011.

The inflection point typically happens when you start to see retail interest. The proof point here is that Costco has been selling gold bars like hotcakes.

Indeed, sales of gold bars provided a “meaningful tailwind” to Costco’s e-commerce sales in the most recent quarter, according to Costco CFO Gary Millerchip. Moreover, the CFO observed that sales of gold were up “double digits” during that quarter.

Wells Fargo analysts estimated that Costco is selling $100 million to $200 million worth of gold bars each month. It’s an interesting phenomenon in which higher gold prices actually lead to more gold-bar sales, not less.

Courtesy: Yahoo Finance

Of course, there are plenty of businesses that sell gold bullion and you don’t have to shop at Costco to get gold. Plus, there are convenient ways to invest in gold through the stock market.

You’d have to be a Costco member to buy gold from Costco, and the company has a sales limit of five total gold-bar units per membership. The point is that I’m not trying to get you to buy gold bars from Costco, but only to see that the retail “gold rush” is just getting started.

At the same time, interest in nuclear power is picking up quickly and we’re seeing headlines about uranium in the media now. Again, this is a typical sign that retail interest is about to ramp up significantly, but there’s still time to get ahead of the crowd.

Here’s a signal that you can’t afford to ignore. Jensen Huang, the famous CEO of NVIDIA, recently declared that “Nuclear is wonderful as one of the sources of energy, one of the sources of sustainable energy.” Experts have been saying this for years, but when Huang talks, people perk up and listen.

NVIDIA’s processors will require a whole lot of power for artificial intelligence (AI) applications. Where will all of that power come from? Huang understands that the U.S. and other nations will have to tap into the potential of nuclear energy, and this will require vast amounts of uranium.

The point is that we can’t just rely on natural gas and coal; nations and businesses must tap into nuclear power. “We’re going to need energy from all sources and balance the availability and the cost of energy as well as the sustainability over time,” Huang explained.

Courtesy: CNBC

Governments, including ones that were previously reluctant about nuclear power, now appreciate the dire need for nuclear energy in the 2020s and beyond. So, uranium stock investors may have done well over the past few years, but the next chapter will be significantly higher prices.

In other words, it’s certainly not too late to take positions in carefully selected gold and uranium assets. Or, you can sit back and hope for lower prices, but that’s “timing the market” and it’s an awfully hard game to win.

Instead, I prefer to start my positions and if prices go down, gradually add to those positions. It’s a strategy that has provided amazing wealth for patient gold and uranium asset investors, and should continue to succeed for folks with an attitude of calm and conviction.