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Why Chris Demuth Jr. Really Likes the Commodity Uranium (0:35) Nuclear Power and the Emotional Tradeoffs (3:20). This is a brief conversation from a recent podcast by investment experts.
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Danielle Snyder: Chris Demuth Jr., runs the world's screening operation. If you haven't checked it out already, I highly encourage you to do so. This guy focuses on arbitrage and litigation and is great at what he does.
So, Chris, let's dig deeper. I want to get things started. Uranium. Last time we spoke, you were talking about that. You mentioned that you have a position in Sprott Physical Uranium Trust (OTCPK:SRUUF) units. Do you still have those? Do you still prefer uranium at this time?
Chris Demuth Jr: We do. a happy new year. It's great to be here, Daniel. It's an important position. This is my only type of direct commodity position. We own some uranium stocks, but it wasn't a sector that many companies and management teams were able to fall in love with.
But we sure like the item. I would say that even since we last spoke, things are leaning more toward kind of a consensus that this kind of — center-right, kind of free market, more capitalist orientation, more pro-energy side, has actually been joined by more and more. From the left of the center governments in Europe and around the world are willing to look at nuclear energy and reclassify nuclear energy as clean energy, which of course is clean, cleaner and safer energy.
And I mean there are individual hydropower projects, especially in the less developed world, that have had far more fatalities than in the entire history of the nuclear industry. It's safe, it's clean. And it's this consensus around the need to produce more energy that's really going to drive this.
Something I love and some of my friends have noticed, but it's kind of my jam, is that I'm very interested in non-conformity on a scale where someone can enrich me on a scale that matters a lot to me, but it doesn't matter that much to them. It's not a big deal.
Uranium inputs into public facilities are not expensive. It can be 2x, 3x, 4x, 5x from here without kicking anyone out. And so I think that's an interesting part of this opportunity. I think it's going to be a big part of our energy future.
I think intermittent alternative energy is a fad. It is useful sometimes at times, in some places, but it will never constitute such a large portion of our energy needs, which will be filled by petrochemicals and nuclear power.
This coal, perhaps, is where environmentalists can achieve in reducing their environmental impact, if they are willing to use nuclear power. But if they say only intermittent power, that's not serious, and that's just kind of excluding them from a serious part of the conversation.
s: Now, there seems to be a lot of fear around nuclear power for a wide range of people, whether it's close proximity to local areas, or the idea that if we go to war, someone might focus on targeting that specific infrastructure.
Do you think that's justified, or is that kind of a trade-off that if we reduce our reliance on power and coal and try to reduce energy costs here for Americans, is that just the kind of trade-off that we need to accept? Any thoughts?
CD: Yeah, I mean I really believe in Tom Sowell's point of view that there are no solutions, only trade-offs. So I think that's a legitimate concern, but it's largely emotional. I mean, it's safe, it's clean, and strengthening our infrastructure against enemies is a deep and important topic. It's an issue that I think nuclear opponents raise cynically and inconsistently.
There's a lot around our network that could be made even stronger, but nuclear plants are actually probably some of the safest and some of the best defended already. It's the same word as a nuclear bomb. It's not like there's going to be a mushroom cloud over one of them even in the event of a disaster. But I think that connection has this emotional pull that's hard to avoid.
s: Chris is always writing new ideas about sifting through the world. Go check it out here on Seeking Alpha.
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