Uranium Investor Information Website: Click Here to Return to Main Page GoldSeek.com GoldReview.com MolySeek.com SilverSeek.com 
Advertise - Bookmark - Contact - - Update Page 
List Sign-Up
E-mail
Subscribe
Unsubscribe


 

Siddharth Rajeev: Don't Count Out Old King Coal Yet

By: The Energy Report and Siddharth Rajeev



-- Posted Thursday, February 25 2010 | Digg This ArticleDigg It! | Discuss This Article - Comments:


Siddharth Rajeev, vice president of research for Fundamental Research Corp., talks about several of the bright spots he sees on the economic horizon in this exclusive interview with The Energy Report. Sid anticipates: recovery in 2010, with rising interest rates by the end of the year. . .longer-term growth in demand for uranium, which this year's commodity corrections somehow managed to overlook. . .continuing strength for rare earth metals as applications expand in electronics and alternative energy. . .even new faces on the coal front. Despite the push toward clean energy, Sid says coal won't go away anytime soon. One of the cheapest sources of fossil fuels in abundant supply, he says that coal is "tough to replace."

The Energy Report:
What do you see for the U.S. economy this year, Sid?

Siddharth Rajeev: We see the economic recovery continuing and increasing investor confidence along with it. We saw that the U.S. GDP grew at 5.7% in Q4, which was the fastest in the last six years and in Q3 posted growth of 2.2%. Therefore, we are definitely seeing very positive signs in the U.S. Yes, inflationary pressures are looming, but we expect the Fed to start increasing interest rates in the second half.

TER: So you're among those who see shoots of recovery and are projecting sufficient positive growth within the U.S. in 2010 to prompt the Fed to start to increase rates.

SR: Yes, because once we see economic growth in the U.S., there's no reason the Fed should not increase rates, especially because of inflationary pressures. We believe the increase in interest rates would be able to limit the inflation rates in the next two years.

TER: You're on the opposite side of what we've been hearing about a recovery in 2010. A lot of people are speculating that with the massive debt the U.S. government faces already—plus the potential for additional stimulus and the cost of radical healthcare changes—the U.S. will not go into recovery this year and possibly not even in 2011. Considering that projection is almost the exact opposite of yours, what are you seeing that they're missing?

SR: The main thing is that the U.S. dollar is still extremely weak compared to other currencies, which would benefit their exports. We believe the combination of a weak U.S. dollar and the stimulus package would result in an economic recovery in the U.S.

TER: What are some of the sectors that you think will perform well in this environment?

SR: One of the sectors that we have a very positive outlook on right now is uranium. We've not really seen any increase in uranium prices, even though all the other metals performed really well in the past few months. It seems like investors have totally ignored this commodity versus all the other commodities, which have responded well to economic recovery. All the money that's being put into infrastructure growth has helped the base metals, but uranium prices have not really responded to the positive news in terms of demand that we've seen over the last six months to one year.

TER: How do you see uranium demand as you look ahead?

SR: Basically, there have been no significant changes on the supply side with uranium, but we have seen very positive news on the demand side, especially long-term demand. Most governments worldwide are realizing the importance of cleaner energy. Obama really stresses nuclear energy. In the long term, maybe two years out, we believe the demand for uranium will be very strong. I think we will see uranium companies probably doing well in the next 12 to 24 months, and uranium prices are something to watch.

TER: One of the darlings of 2009 was all those rare earth metals. Are you following those and, if so, what's your view of that sector?

SR: We also have a positive outlook on rare earth metals, especially because more than 95% of the production comes from China. As you know, over the past year or two, China has increased restrictions on export quotas and raised export tax rates. So they are definitely trying to preserve their resources, and because the supply is concentrated in China, we believe global supply will be affected. On the demand side, rare earth metals are now being increasingly used in electronics and alternative energy. These factors will drive demand for rare earths.

TER: Are there other plays in clean energy?

SR: Uranium has the most potential on the clean energy side. But then definitely we have a positive outlook on alternate energy, clean energy.

TER: It's always educational chatting with you, Sid. We love hearing about those very interesting projects you seem to find in the beginning of their uptrend, and appreciate your sharing the information with us.

Fundamental Research Corp. VP Siddharth Rajeev oversees FRC's research department as well as covering a broad array of companies, primarily in the energy, mining and technology sectors. Sid is ranked a 4-star analyst in the energy sector by Deutsche Asset Management, a division of Deutsche Bank, with 2009 picks in energy and mining sectors that outperformed their respective benchmarks after transaction costs. Prior to joining FRC in April 2006, he had a mix of engineering and finance experience including work in corporate finance at a leading investment bank in Kuwait. Sid holds a Bachelor of Technology degree in Electronics Engineering from India's Cochin University of Science & Technology, and an MBA in Finance from the University of British Columbia. He is also a Level 3 candidate in the CFA (Chartered Financial Analyst) program, and has completed studies in exploration and prospecting at the British Columbia Institute of Technology.

 

Streetwise - The Energy Report is Copyright © 2010 by Streetwise Inc. All rights are reserved. Streetwise Inc. hereby grants an unrestricted license to use or disseminate this copyrighted material (i) only in whole (and always including this disclaimer), but (ii) never in part.

The Energy Report does not render general or specific investment advice and does not endorse or recommend the business, products, services or securities of any industry or company mentioned in this report.

From time to time, Streetwise Inc. and its  directors, officers, employees or members of their families, as well as persons interviewed for articles on the site, may have a long or short position in securities mentioned and may make purchases and/or sales of those securities in the open market or otherwise.

Streetwise Inc. does not guarantee the accuracy or thoroughness of the information reported.

Streetwise Inc. receives a fee from companies that are listed on the home page in the In This Issue section. Their sponsor pages may be considered advertising for the purposes of 18 U.S.C. 1734.

Participating companies provide the logos used in The Energy Report. These logos are trademarks and are the property of the individual companies.


-- Posted Thursday, February 25 2010 | Digg This ArticleDigg It! | Discuss This Article - Comments:



© UraniumSeek.com, Gold Seek LLC
The content on this site is protected by U.S. and international copyright laws and is the property of UraniumSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on UraniumSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.


Disclaimer
The views contained here may not represent the views of UraniumSeek.com, its affiliates or advertisers. UraniumSeek.com makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of UraniumSeek.com, is strictly prohibited. In no event shall UraniumSeek.com or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.