Poll for Active Investors, Planning Stage
- Thread starter northeast
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TheSilencer1313
Well-Known Member
Especially in this economy.
Gyp Rosetti
Banned
Long-term, I LOVE some of the water ETF's...it's the next oil.
Perhaps VERY long-term. I don't like them, personally. If you're looking to invest, be careful of some specific factors;
- how much actual stock in water rights are owned (vs. real estate, for example)
- in the geographic area the water is owned, how heavily regulated is it? (the expense of running the 'utility' can totally ruin the profitability)
I have a very good friend that's a billionaire. 30 years ago he sold most of his massive real estate holdings, converted to actual water rights, and now provides the water (as a lease) to cities .. And his contract also dictates that the cities bare all the expense of the utility side of things.
Effin brilliant to do this 30 years ago.
Only a small portion is actual water. It's more of a tech play, including the infrastructure end of tech. I've always had a hard time with the sector because it's too hard to find a lasting advantage without being on the inside of the industry. I spent time looking at the basic end like Toro for their drip irrigation systems--but where is their competitive advantage when these become economically advantageous and other companies climb on board?
The new membranes and anti-flashing chemicals have been very promising (desalination & sewage treatment). They can actually purify toilet water through these membranes to better level than most of our freshwater currently is, but we have a thing against drinking it even if it is clean. Buffett bought that chemical treatment company & I suspect his knowledge of the power industry gave him the edge needed to understand that one. It also doesn't hurt if your companies are already spending millions on NALCO products. Desalination will be huge in the future without dramatic climate changes. A company that can figure out affordable cooling towers that don't waste any water will be worth their weight in gold. There are some of these systems already but they're pretty expensive last I checked.
Desalination will (does) cater more to Isreal out. Conservation is much more promising in N. America & Europe, IMO. Gravity is on its side. Things like drip irrigation might sound simple & boring, but it's actually an incredibly efficient delivery mechanism for not only water but also fertilizers and pesticides. Smart farmers in the mid-west will be fighting over these systems the next time potash prices spike. They are already economically viable but require the capital input, initiative & a little convincing. I bet farmers with these installed are cleaning up on corn while everyone else's crops are failing.
You'll know Bernanke will be stopping when the economy gains traction. This move will probably do more for employment than everything congress did in the last four years combined.
so what companies make drip water irrigation systems?
first one I saw with a google search was Deere.
https://www.deere.com/en_US/water/applications/sdi/sdi_home.html
first one I saw with a google search was Deere.
https://www.deere.com/en_US/water/applications/sdi/sdi_home.html
TheSilencer1313
Well-Known Member
The government counts on farmers depending on their free hand outs.
So when things go really bad, they'll just hand over their land rights as opposed to paying the higher property tax.