Dear Reader,

Welcome to the weekly mailbag edition of The Bleeding Edge. If you have a question you’d like me to answer in a future edition, write to me by clicking right here. Let’s get started…

I just read your article on nuclear reactors. I’m all in favor of nuclear power as I worked in the nuclear area for many years. I thought we made a huge mistake in the 1970s and ‘80s when we let fear and misunderstanding move us away from nuclear energy – rather than addressing the issues using engineering facts and technical solutions.

I agree with all you say, but one of the big issues is dealing with radioactive waste, and nobody mentions that. But I think with reasonable criteria, there are technical means to resolve that issue.

– Greg L.

I read your “The Age of the Atom” article Monday about nuclear-generated power. I agree 100% that it’s the best source we have for power right now. And what I was hearing was that nuclear *fission* technology is getting much closer to a reality for full-scale generation – when it’s here, it will have zero nuclear waste.

Why do you not bring up nuclear fission and talk about the companies that are working to make it a reality? It feels to me like it might possibly be as important as AI tech, but I have not once seen you bring it up. Please let me know. I, and I’m certain many other readers on your threads, would love to know.

– Michael H.

Thanks for writing in, Greg and Michael.

You’re right, fear and politics have derailed advancements in nuclear technology and use. That’s why I’m keeping a close eye on developments. I know that nuclear power can solve many of our biggest issues today.

But we have to temper our expectations. It’s going to take years to unwind the fearmongering over nuclear power and see more plans for new projects.

Being early to an investment can have its advantages, but with that comes much higher risk. Waiting for a company’s product to become reality often comes at a price. Dilutive fundraising or simply running out of money (and investor interest) can often happen.

The energy technology sector is an exciting space. But we need to focus on being right instead of early. Along with nuclear power, we’re looking at battery storage and alternative energy. We’re also keeping a close eye on where the bottlenecks and breakdowns in the energy grid are going to occur in the short term – as that will drive faster-than-anticipated investment. We’ll absolutely be bringing more energy technology discussion to the newsletter and the portfolio recommendations.

Michael, as for your question, I believe you’re referring to nuclear fusion. Fission energy is the nuclear technology that is already up and running around the world.

The topic of fusion is an interesting one. Yes, there have been important breakthroughs in this space. In December of 2022, scientists created a fusion reaction with a net energy gain for the first time. At the Lawrence Livermore National Laboratory in California, scientists sent 2.05 megajoules of energy through a laser towards a diamond capsule filled with hydrogen. The resulting reaction released 3.15 megajoules of energy.

This was a great scientific breakthrough. But that’s the important point. These developments are science experiments at this point. The path towards commercialization and adoption will be a long one. If I had to guess, I’d say it would be a process measured in decades.

And that means the investing implications for fusion energy just aren’t here yet. That doesn’t mean we can’t be excited about this technology. But my core focus right now is to find near-term investable trends. And that’s why I’ve spent less time covering the developments with fusion.

I’m an unlimited subscriber and happy to be here. I love the attention to AI as I have been trying to digest as much of it as possible. Trying to learn as much about AI, Crypto, and NFTs, working full time, and trying to figure out your best investments requires a 36-hour day.

Your AI info and insights are great, and I love reading them. I would really like more from The Bleeding Edge though. There is so much going on in the investment world with regard to tech, robotics, logistics, finances, crypto, etc… I would like to read more. Sure, AI is touching about everything right now and will continue to explode into almost every part of our lives. I guess I am just looking for more info and insights from a wider variety of topics.

– Daniel K.

Daniel, thanks for being a subscriber. I’m happy you’re with us. I agree with you – I’ve been very excited about AI, and I think the broader technology sector has been as well. This is a particularly unique time, one that I haven’t seen since the launch of the iPhone – which then ushered in the mobile web, social media, and in many ways cloud computing.

Truly, we are still in the early stages of it all. The hardware is just making its way out to the data centers, and it takes time for the server engineers to get it operational. Then, it can take months to develop anything significantly useful from this. Most software companies aren’t even generating significant revenue from AI until 2024.

In a few years, we’re going to look back and realize what a pivotal moment this was. Nvidia’s results on Wednesday underscore that fact. A trillion-dollar company growing revenues over 100% and guiding for revenues that were 33% higher than expectations that were already sky-high is unheard of.

On the backend of this growth will be robotics, automation, software, and services. In many ways, I see myself sitting here in a few years looking back and recalling what a great time it was to be writing about all this.

I’ll do more to highlight a wide variety of topics as we move forward. However, I truly believe to be a great investor, having a narrow focus is key. When I think of some of the greatest investors ever, I can always pin down their investment style very easily.

That’s one reason why my focus might seem narrow. But like I said, I can bring more to the newsletter, and I will. Thanks for the feedback.

That’s all for this week’s mailbag. Thank you to everyone who wrote in.

If you have a question you’d like me to answer in a future mailbag, feel free to send me a message at [email protected].


Colin Tedards
Editor, The Bleeding Edge