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Next Generation Nuclear Technology

Done with PCs, Gates Goes Nuclear

Written by Nick Hodge
Posted February 16, 2010

The rich get richer.

That phrase has entered our common diction for a reason: by and large, it holds true.

You see, the rich aren't just good at staying rich — hoarding assets, beating the tax code — but they're also good at creative financial thinking. If financial planning were a chess game, the rich would always be thinking several moves ahead.

Case in point: Bill Gates.

Even in his younger days, Gates knew how turn a dollar. In eighth grade, he used proceeds from a yard sale to buy a precursor to the modern computer: an 8-bit ASR-33 made by Teletype. You know the rest of the story...

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But here's the thing about the rich: their frame of mind never changes. It's always about the next big thing — identifying the next mega market trend before anyone else.

Right now, Gates is at it again. And you might be surprised to learn the market he's after.

Gates' Stealth Company

Of course, you know about Microsoft's success because of its immense public presence. But the rich are good at hiding things — be it lumps of cash in offshore havens or big ideas in the works.

So I'm guessing you've never heard of Intellectual Ventures, which BusinessWeek calls Gates' "innovation/invention incubation outfit."

This time, Gates is working on what he refers to as an energy miracle, incubating a company called Terrapower. The company's website boasts that "a wave of fission moving slowly through a fuel core could generate a billion watts of electricity continuously for well over 50 to 100 years without refueling."

Put simply, Gates is looking to build a nuclear plant that uses natural or depleted uranium.

Can it happen? That's yet to be seen. By its own admission, Terrapower says any such plant wouldn't come online until the "early 2020s." Still, I pass this tidbit along not for its energy implications, but for the investment philosophy behind it.

Ahead of the Nuclear Curve

Gates is clearly able to assess the long-term writing on the wall.

He was funding Terrapower long before nuclear energy made its way back into the limelight. He knew nuclear energy had to make a resurgence if we're ever to truly enjoy energy independence and reduce our emissions.

He was thinking several chess moves ahead.

And look what's happening now...

Obama just called for a "new generation" of nuclear power plants to be built in the United States and has requested $54 billion in his budget to get them started.

Just this week, the Wall Street Journal reported, "The Department of Energy (DoE) is awarding the first conditional loan guarantee for a new nuclear power plant in the U.S. to Southern Co.'s Vogtle plant in Georgia."

Think Like the Rich

So here's your opportunity to think like a rich investor, because it's unlikely you're able to fund a nuclear start-up like Gates can.

For starters, you'll want to look at the next companies in line for nuclear loan guarantees... like the one just awarded to Southern Co. (NYSE: SO).

According to DoE filings, Scana Corp. (NYSE: SCG), Constellation Energy (NYSE: CEG), and NRG Energy (NYSE: NGR) are next on the list.

But there's an even better way to think like a billionaire investor — by capitalizing on the one thing every new and existing nuclear power plant needs, regardless of who builds them: fuel.

By investing in nuclear fuel, you gain exposure to the entire industry and all of its coming growth.

Now, the standard names are already out there. Cameco (NYSE: CCJ) is the obvious choice. But to truly think like the rich, you have to think outside the box.

And there's a company doing just that. It's making a nuclear fuel additive that allows 25% more energy to be extracted from existing nuclear fuel. Even better, it absorbs much more heat, preventing meltdowns from happening ever again.

It's truly a few steps ahead. This company is already lining up massive sales contracts. It'll be common knowledge soon — but right now, it's still being "incubated," as Gates would say.

The company is public and you can buy shares now. All the information about the company and its breakthrough technology can be found in this new report.

Call it like you see it,

Nick Hodge

Nick

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