Long or Short Capital

With the Olympic background, the Georgia-Russia-South Ossetia squaredance has been getting a lot less attention than it should. Most people don’t even know that Georgia isn’t even in the United States, much less how important South Ossetia is to ensuring that enriched uranium remains affordable for blue-collar Americans. Just as the demand for gas picks up when the so-called “driving season” officially opens, so to does the demand for enriched uranium pickup in the so-called “atomic bomb hobbyist season”. It starts in just one week, with it’s tradititional commencement on the third Monday of August.

Unlike with gasoline, we are confident that there will be no actions in Government designed to help affected consumers, already laden with credit card debt, mortgage debt, second mortgage debt, third mortgage debt, car payments, tv payments, home theater payments, debt surrounding the bowling alley they had installed in their ranch house, inflation, a weak labor market, and Exxon-Mobil’s extortative pricing practices. Expect to see some atomic bomb hobbyists forced to switch to less expensive substitutes, like trinitrotoluene, napalm, or even baking soda.

Recommendation: There will be demand destruction for all enriched uranium stations, in addition to a squeeze on their margins. Short them, but maintain a nimble predisposition. Long-term, it’s harder to get a feel for the direction enriched uranium prices will take. The war situation is bumping up prices now, but if South Ossetia links up with North Ossetia and becomes one with Russia, the market price will likely decrease. But if the land remains in a state of anarchy without actually being at war, still a pseudo-province in Georgia, enriched uranium prices will likely come in back to recent levels.

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