Peak Oil, Peak Water.. We’re All Gonna Die

Let’s keep this in context.. gloom and doom sells.  Period.  I’m not disputing the fact that scarce commodities are becoming increasingly valuable but I don’t buy all the gloom and doom either.  That being said, I just read a good article on Peak Water from Wired.

Here are the cliffs notes for those short on time:

* 1.1 billion people, about one-sixth of the world’s population, lack access to safe drinking water.

* Shortages are reaching crisis proportions in even the most highly developed regions, and they’re quickly becoming commonplace in our own backyard, from the bleached-white bathtub ring around the Southwest’s half-empty Lake Mead to the parched state of Georgia, where the governor prays for rain.

* … This is not to say the world is running out of water. The same amount exists on Earth today as millions of years ago — roughly 360 quintillion gallons. It evaporates, coalesces in clouds, falls as rain, seeps into the earth, and emerges in springs to feed rivers and lakes, an endless hydrologic cycle ordained by immutable laws of chemistry. But 97 percent of it is in the oceans, where it’s useless unless the salt can be removed — a process that consumes enormous quantities of energy.

* Freshwater is the ultimate renewable resource, but humanity is extracting and polluting it faster than it can be replenished.

* If moneyed special interests determine the going price of water, eventually they will edge out users who can’t afford to pay top dollar. Agriculture will be squeezed out, as will water rights for poorer communities. And the environment, it goes almost without saying, will twist in the wind

* "People need to get away from the idea that you just turn on the tap and all the water you want is there"

* Stripping seawater of its salt is a pricey way to obtain freshwater, cost-effective only for high-end uses like drinking, but not bathing or watering gardens.

* The country (Australia) was founded during the second-worst drought in its history, but the worst dry spell is unfolding right now. Rainfall, which has declined to 25 percent of the long-term average, is projected to plummet another 40 percent by 2050.

* The price of beer has been rising since a jump in barley prices, a development that many joke could lead to large-scale civil unrest. But it’s no joke: The global price of wheat hit its highest level in decades in December, partly due to Australia’s water shortage.

* Americans already use 20 percent less water per capita than they did a generation ago. Gains in industrial use are even more impressive: A ton of US steel manufactured today requires just 2 percent of the water it did in the 1940s. Still, we are using more than we have. Can we change enough, and soon enough?

Investing in companies that control, distribute and/or purify water are probably safe bets over the next several years.  Two ETF’s provide a diversified way to do that – the PowerShares Water Portfolio (PBW) and the Claymore S&P Global Water Index ETF (CGW)

One thought on “Peak Oil, Peak Water.. We’re All Gonna Die”

  1. The ticker symbol for Power Shares Water Portfolio is PHO. PBW is the alternative energy ETF. Also check out PIO, the Power Shares Global Water Portfolio, which is much more actively traded than CGW.

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