Invesco Water Resources ETF Trust (PHO)

[frenchee]

The politics of water (thanks FuturesJackal

A decaying water system leaves the nation vulnerable

http://www.freep.com/article/20090114/OPINION05/90114090/1068/OPINION/A+risk+America+can+repair

By JOAN ROSE • January 14, 2009


It’s not very sexy. Yet it is one of the most important and potentially costly health-related issues facing our nation. I refer to the need to continue supplying safe, clean drinking water — billions of gallons a day. Threats to our water security are increasing and the infrastructure for delivery to our homes, schools, hospitals and places of work is crumbling.


Replacing thousands of miles of old, rusting and leaking pipelines — sometimes 100 years old — is essentially a local and state issue. But cumulatively, it is a serious national problem, requiring major investment, planning and construction on a national scale. Clean water is essential to our lives. Ensuring its future availability should be a priority for the new head of Department of Health and Human Services, Tom Daschle, and the heads of Department of Interior and the Environmental Protection Agency.

So far, we have been lucky. But a recent outbreak of e-coli in Colorado is a reminder that even in states with the most impeccable safety records, breakdowns are occurring with growing frequency. Vigilance is essential to prevent a recurrence of waterborne diseases such as typhoid and cholera that claimed so many thousands of lives in the past.

Do we have the expertise to prevent this? Yes. Do we have the technology? Yes. What we need is the political will — and yes, billions of dollars of investment to restore and expand our water infrastructure. It is hard to think of a more urgent use for future federal funds.

Looking back, this country has a great record. The fact that our whole population of more than 300 million can today take clean drinking water for granted is an achievement difficult to overestimate. It is a tribute to the many scientists, engineers and public health officials who made it happen and to the country’s far-sighted investment in the development of our vast water infrastructure.

It is also a tribute to those researchers, here and in Europe, who discovered that chlorine was a safe, reliable and affordable disinfectant that killed dangerous bacteria in the water and essentially eliminated waterborne diseases, literally saving the lives of thousands of infants and children who otherwise, each year, faced deaths before ever reaching age five.

This development has been described as probably the greatest advance in public health.

Few of us working in the field would argue. It is worth remembering that in the early 1900s, waterborne diseases were still rampant and claiming thousands of lives each year. Attempts to purify water often ended in failure. Raw sewage was often dumped directly into the rivers and lakes that were also a source of the region’s drinking water. Little surprise, therefore, that life expectancy hovered around the mid-40s.

The big breakthrough in eliminating waterborne diseases and almost doubling our life expectancy came just over 100 years ago. In 1908, Jersey City, New Jersey, became the first municipality in the country to chlorinate its water supply.
The results were dramatic. Within a few years, death rates from waterborne diseases plunged by 90 % and life expectancy soared.

It is an anniversary that has passed almost unnoticed, but for those of us concerned with public health, it is an anniversary worth celebrating. But while our drinking water today is among the world's safest, we cannot relax. Our aging wastewater and water distribution systems pose an increasing threat to public health. And we need to increase our investment in the research and development of water science and technology.

Safe drinking water is important not only for the health of our population, but for our economic prosperity and quality of life.

Sexy or not, the new administration cannot afford to ignore this largely unseen but very serious challenge to its governance.

[frenchee]

Current P&F price objective is 21 for PHO. See chart in iBox.

[frenchee]

Breakout happened last Friday on PHO. Water resources is a great long-term play...

[frenchee]

The First Billion Is the Hardest
By Chris Mayer
“I’ve been drunk, but never two nights in a row.”
- T. Boone Pickens
T. Boone Pickens’ new memoir, The First Billion is the Hardest, is better than I thought it would be. Based on reviews I’ve read, I thought it would spend a lot of time on Pickens’ plan to reduce U.S. oil dependency. I always find such discussions a bore. But that part of the book was only 10 of 250 pages.
Mostly, it’s memoir material, with some peeks into the future as T. Boone sees it evolving. The most interesting parts, to me, were some nuggets from his career, his views on natural gas and his large investment in water.
Pickens is 80 years old now, and he’s accomplished an awful lot in his career. He started Mesa Petroleum with $2,500. Five years later, he took it public, and Mesa earned $435,000 in profits on revenues of $1.5 million. Not a bad start at all. After only eight years as a public company, Mesa generated $92 million in sales and $15 million in profits. It helped make him a rich man.
Along the way in the book, Pickens offers various “Booneisms” such as: “Chief executives who themselves own few shares of their companies have no more feeling for the average stockholder than they do for baboons in Africa.” (That’s one reason why the “O” - owner-operators - in CODE is important.) Or this: “As my father used to say, ‘There are three reasons we can’t do it. First, we don’t have the money, and the other two reasons don’t make a damn.’”
He complains about the bureaucratic nature of Big Oil and its track record for dumb deals. “I’ve said that giving the good old boys of Big Oil excess cash flow,” Pickens writes, “is like handing a rabbit a head of lettuce for safekeeping.” Pickens points to Mobil buying Montgomery Ward as part of its plans to diversify. What a bust! In 1984, Fortune focused on the seven worst mergers of the decade. Four of them involved oil companies. I think big oil companies have gotten smarter since - or maybe just less dumb.
Gains of 9,095%!
He also talks about his career in deal making, finding deep values in the oil patch and making millions taking them over. He eventually gets out of the oil business and starts BP Capital in June 1997. What follows is an incredible ride. By May 1998, the fund lost $24 million and had only $13 million left. By January 1999, it was down to $2.7 million - down 90%.
It was practically out of business. No one would’ve blamed Pickens for changing things or giving up. Some investors left him, but most stuck with him. It paid off big for those who stuck to their guns.
In 2000, he rung up one of the best years anybody has ever had anywhere - up $252 million, a 9,095% gain! I love Pickens’ grit and determination in all this, sticking it out and coming back.
Plus, Pickens offers peeks into the future. A couple of topics piqued my interest: natural gas and water.
The Fuel of the Future
“Natural gas is the fuel of the future,” Pickens writes. I agree with him. Natural gas is our second largest resource, behind only coal, and it burns a lot cleaner than coal does. Pickens’ big vision for natural gas is as a transportation fuel. The logic is pretty simple. “[Natural gas] is the highest-priced fuel in the United States when used for power generation, but it’s cheaper than gasoline or diesel when used for transportation.”
Pickens is talking his book, as they say. He owns Clean Energy, which runs fueling stations for natural gas and builds more every year. Even so, he makes a good case. I was not aware, for example, that there are already 8 million natural gas vehicles on the road worldwide already. He also points out that 25% of all transit buses burn natural gas - a use that’s growing 25% annually.
I had a hard time imaging who would want to own a natural gas vehicle when fueling stations are so sparse. It’s kind of like being one of the first people to buy a telephone. But I recently read a review of the only natural gas-powered car in America at the moment: the Honda Civic GX.
It was a positive review. Though the range is limited to only 200-220 miles, the car comes with a GPS locator to find the nearest fueling station for you. Refilling also costs about half of what it would cost you for gasoline, though the car itself sells for a third more than a gasoline-powered Civic. Tax credits help offset that somewhat, and the EPA estimates the payback is about 21/2 years. Meaning after that, you’re even with the conventional gasoline vehicle. There are also home fueling systems that go for about $5,000 and let you tap into your gas lines at home (assuming you have gas). You get tax credits for that too.
Anyway, this is the way these things get started. Pricey in the beginning, but as technology improves and more people adopt, the price will go down. I think there is a good future in natural gas-powered vehicles.
There Is Profit in Scarcity
In addition to his stance on natural gas, Pickens writes that he is a large owner of permitted groundwater in the U.S. His investment here follows the same key principle he’s used throughout his career: There is profit in scarcity.
Pickens owns land in Roberts County, Texas, a place so rich in water, he jokes it’s the only place he couldn’t drill a dry hole. It’s not difficult to pump 1,000 gallons per minute. This land lies above the Ogallala Aquifer, one of the largest in the U.S., covering over 174,000 square miles across eight states.
Pickens plans to sell water to parched regions in Texas, like Dallas or San Antonio, where water supply is becoming an issue. “We can deliver water faster and more cheaply than any other option on the table,” he writes. “It’s not a matter of if, but when, and I’m betting it’s soon.”
I’m thinking along the same lines as Pickens on water, too. This all ties back to the agriculture theme, as well. In fact, The Economist recently ran a story called “Running Dry: The World Has a Water Shortage, Not a Food Shortage.” It’s a simple idea. As world populations and incomes rise, expect to see meat consumption also rise. Meat takes more grain and water to produce - exponentially more.
In a post-finance world, where the mortgage gravy train is dead in its tracks, these are the kinds of ideas - essentials like grain and water - that will attract new money.

[frenchee]

Bulls Love Water, Longterm Water Ideas

Santosh Sankar

Water, unarguably the most precious natural resource in the world is attracting investors who find its longterm scarcity attractive. There has been an increasing concern about the future of fresh water supplies used in a wide variety of applications from farming to bathing. The environment is shaping up favorably for companies involved in water management, treatment, and distribution. I also believe that corporations involved in the manufacturing of the components used to lay down the water supply chain- pipes, brackets, filtration systems, etc. The growing concern for water has even attracted the likes of T. Boone Pickens has been quietly accumulating the rights to water, yes, water in Texas and the Midwest.

Before you read any further I will advise that many water companies have yet to operate profitably since they are growing and investing heavily in their operations. This is an obvious risk that should not be taken lightly; these companies have no free cash flow and post negative EPS for the most part. I would suggest that water ETFs are a better way to take advantage of the favorable operating environment while protecting your portfolio from the risk.

Pickens Loves Water

The most notable investor is T. Boone Pickens, the legendary energy investor who has surprisingly gone green with his interests. Pickens is a proponent of water and has jumped head first into the water management field. The establishment of Mesa Water in 1999 marked the beginning of Pickens’ mass acquisition of water rights in Texas. Texas established a law in the early 1900s that simply stated that “the biggest pump wins.” This meant that one could build a pump and essentially pump water right out of your backyard- the idea that someone could make money off your property did not excite Pickens. After accumulating rights to large amounts of ground water, Pickens strategically found ways to cash in on the imminent scarcity of water in urban Texas. To read in detail about Picken’s water plans, visit Business Week. Investors have followed this trend as water management companies have entered to capitalize on water as related ETFs are making a rise.

Water ETFs

As I stated earlier, water ETFs seem to be the best way to capture the boom in the water commodity/infrastructure market. Here are some solid ETF plays that show great potential as more people begin to tackle our future water problems.

PHO has hit highs of over $22 as the largest water ETF with over 2 billion in assets under management. FIW and CGW however have had a rough time but I do like them as a longterm holding. It is a simple move, all these ETFs are down YTD but water is scarce in the long run, in my opinion this is a solid buying opportunity. The companies these ETFs hold are set to receive great business as more and more people realize how grave our water issues can get. ETFs are diversified well over the utilities, bottlers, filtration, and pipeline entities that are set to explode. Do not be discouraged by the poor YTD performance if you are here for a LONGTERM enviromental play.

If you are looking for a specific company, General Electric is committed to reducing water usage and has entered a joint venture to provide water filtration and management solutions. GE which has seen a lackluster year is providing investors with great buying opportunities as a leader in industry and in my opinion solid longterm growth prospects with their ecofriendly products.

Longterm investors should look at water and consider the long term opportunities present for companies involved in this business. I do not expect immediate gains with the current economic enviroment paired with the lack of urgency for proper water management. If you are unsure about this play, Pickens’ forsight should provide some guidance as the world faces not just energy problems, but problems with many of it’s natural resources.

- Santosh Sankar

[frenchee]

Next target is Fib 38.2% retracement.

[frenchee]

PHO went on a short-term buy signal today...

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Here's an water infrastructure play that has my attention...

[frenchee]

nice close today relative to the open--perhaps a bottom next week?

[frenchee]

I think it's a good offensive play!

Liquid Assets, a ninety-minute documentary, tells the story of essential infrastructure systems: water, wastewater, and stormwater. These systems — some in the ground for more than 100 years — provide a critical public health function and are essential for economic development and growth. Largely out of sight and out of mind, these aging systems have not been maintained, and some estimates suggest this is the single largest public works endeavor in our nation’s history.

“We have about 2 million miles of pipe in this nation. If you look at what we’re spending now and the investment requirements over the next twenty years, there’s a $540 billion difference.”

—Steve Allbee, U.S. Environmental Protection Agency

Exploring the history, engineering challenges, and political and economic realities in urban and rural locations, the documentary provides an understanding of the hidden assets that support our way of life. Locations featured in the documentary include Atlanta, Boston, Herminie (Pennsylvania), Las Vegas, Los Angeles, Milwaukee, New York City, Philadelphia, Pittsburgh, and Washington, D.C.

Documentary Themes
The Fundamental Public Health System We Take for Granted
Essential to all life on earth, water is the provenance of civilization. Throughout history, thriving cities have had in common the presence of a water infrastructure. Much of the original American infrastructure, however, is still unchanged and in use today. This section will illuminate the integral role of water and wastewater infrastructures in our lives, offering a brief history of wastewater practices, in addition to accounts of the burdens placed on, and the neglect of, our current system.

A Watershed Protection Approach
To understand the risks of neglecting our buried assets, we need to understand our role in watersheds and hydrologic/geologic cycles. This section will follow the natural cycle of our water supply and address the health and environmental hazards that our cities face when industrial and residential districts unsustainably interface with the water cycle.

An Engineering Marvel—Seeing the Unseen
Simply considering the complexity of constructing a system serving a city the size of Philadelphia or Atlanta is daunting, but the task of restoring a broken system is even more so. With the help of 3-D imaging and dynamic animation, this section will visually expose America’s underground and explore, with engineers, the technical complexity of our national infrastructure.

21st Century Solutions
The preceding section will dovetail into this one, which will explore the innovative solutions being developed by engineers to address infrastructure rehabilitation needs. Buried asset management, robotic pipe inspections, engineering research, pipe restoration and replacement technologies—these concepts, along with the best practices from around the country, will be explored, revealing a portrait of 21st century technology, economics, and solutions.

The Challenge
Hundreds of billions of dollars are required to restore America’s infrastructure. This section will track how cities and regions are confronting infrastructure rehabilitation, both economically and politically.


http://liquidassets.psu.edu/the_film/index.html

[Picassa]

Good defensive play.

Gonna follow it

[frenchee]

sweet gap up today...

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Got a short-term buy signal with today's close!

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PHO coming up on trendline support as shown on the daily charts in the iBox. A decisive bounce off the trendline will be a short-term buy signal

[frenchee]

Got a short-term sell signal with PHO's close today...

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PHO negative "mo" starting to lessen. Look for the daily ADX to turn down with a decisive close > 5-day price EMA for a short-term buy signal.

[frenchee]

There will be H2O...

http://www.businessweek.com/magazine/content/08_25/b4089040017753.htm?chan=magazine+channel_top+stories

[frenchee]

PowerShares Water Resources Portfolio (the Fund) seeks investment results that correspond generally to the price and yield of an equity index called the Palisades Water Index (the Index). The Palisades Water Index includes water companies drawn from sectors, which include water utilities, treatment, analytical and monitoring, infrastructure and distribution, water resource management, and conglomerate water companies. The Index includes companies that focus on the provision of potable water, the treatment of water and the technology and services that are directly related to water consumption. The Palisades Water Index was created by Hydrogen Ventures, LLC. The Fund will normally invest at least 80% of its total assets in American depositary receipts and common stocks of companies in the water industry. The Fund generally will invest in the stocks comprising the Index in proportion to their weightings in the Index. The Fund's investment advisor is PowerShares Capital Management LLC.

[frenchee]

Water, too, remains a commodity in high demand. One driver in rising water consumption is the rush to produce biodiesel, as this McClatchy chart shows:

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On the scarcity scene, scientists are flooding the Colorado River.



The U.S. Department of the Interior has ordered the folks running the Glen Canyon Dam at Lake Powell to flood the Colorado River at a rate of 300,000 gallons per second for the next 60 hours. If the Empire State Building were an empty container, this man-made flood would fill it in less than 20 minutes.

The government is ordering the flood to restore sandbars and ecosystems in the Grand Canyon, but we hasten to add that the billions of gallons of water will end up in Lake Mead... the very lake we showed you last week being sucked dry by neighboring cites. How convenient.

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PowerShares Water Resources Portfolio (PHO) is actually an investment in infrastructure, Gordon says. The idea incorporates everything a society may do to use electricity, roads, communication networks, water transportation and the creation and maintenance of sewage systems. Equal weighting of small and mid cap companies make it a quick growth investment.

[frenchee]

Feds say water negotiations have failed By BEN EVANS, Associated Press Writer
Sat Mar 1, 5:59 PM ET



WASHINGTON - Interior Secretary Dirk Kempthorne acknowledged Saturday that White House-brokered water negotiations among Alabama, Florida and Georgia have failed.

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Without an agreement, the Army Corps of Engineers and other federal agencies will begin implementing a water-sharing plan of their own, Kempthorne said in a letter to the governors.

"Regrettably, it will necessarily be a solution being directed to the states instead of our much hoped for solution coming from the states," he wrote in the letter, released Saturday.

Kempthorne said the talks, which began last fall, yielded more progress in three months than at any time during the last 18 years.

But he said the negotiators could not reach a comprehensive agreement and called it "unfortunate" that the states are moving forward with ongoing litigation.

"It is our hope that developments in the courts will not frustrate further progress in resolving the remaining technical issues we face together," he said.

The three states have been feuding for nearly two decades over water rights in the Apalachicola-Chattahoochee-Flint and the Alabama-Coosa-Tallapoosa river basins, which run south through Georgia into Alabama and the Florida panhandle.

Georgia is fighting to hold back more water in federal reservoirs around Atlanta to serve its growing population.

Florida and Alabama argue that Georgia hasn't adequately planned for growth. The extra withdrawals, they argue, would damage the environment and dry up river flows into their states that support smaller municipalities, power plants, commercial fisheries and industrial users like paper mills.

With a record drought creating a critical water shortage last fall, President Bush dispatched Kempthorne to try to settle the dispute.

But the talks appeared doomed from the start, with Florida almost immediately backing away from an initial agreement to allow Georgia to temporarily hold back more water in Lake Lanier outside Atlanta as the governors worked toward a longer-term pact by Feb. 15.

Then Georgia lost a major court ruling in a case that raised questions about whether the federal government can allocate the state more water from the river basins without first getting approval from Congress or the U.S. Supreme Court.

After a series of meetings, the governors missed the Feb. 15 deadline but said they would continue talking until March 1.

The talks appeared to unravel further in recent days, with Georgia Gov. Sonny Perdue saying the water problems facing Florida and Alabama are not as critical as Georgia's and accusing the other states of approaching the talks without the same urgency as Georgia.

Alabama Gov. Bob Riley responded by saying that prospects for a negotiated solution were "indeed dim" if Perdue could not acknowledge that Georgia's needs are no more critical than those of the other states.

Against that backdrop, Georgia officials said Saturday they will not make a severe drought declaration for the lower Flint River Basin in the southwest part of the state.

[frenchee]

PHO on the move again...

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Looks like next target is lower Bollinger Band on the daily chart in the iBox.

[frenchee]

ETFs Flow Clean Water For The Future
November 21, 2007
by Tom Lydon
Jonathon Greenblatt wants to change the world and help exchange traded funds (ETFs), one bottled water at a time. He is the co-founder of Ethos water, a business whose mission is to provide the world's children with clean drinking water. This local enterprise started in health clubs, schools and cafes. It then went on to Whole Foods before eventually coming to Starbucks, reports Lara Seligman for The Daily Pennsylvanian. In fact, every bottle of Ethos water sold in Starbucks will donate 5 cents to the global water crisis, giving drinking water to countries in need.

On the government side, Congress is negotiating the Clean Water Restoration Act H.R.2421. The outcome would give the Federal government the right to gauge how normal activities affect every drop of water that falls on your land, reports Jonathon Youngberg for AGWeekly. Federal bureaucrats could visit farms, ranches and even your very own lawn to see how, say, altering how your lawn slopes, changes how rainwater runs off.

This is a bit extreme and there is an easier way to help the water crisis and make sure your energy goes into companies that help secure clean drinking water here and abroad. Many of the clean water ETFs invest in companies that manufacture clean drinking water, and make the machinery for purification and distribution.

An ETF to take a look at if this is an issue that concerns you is PowerShares Water Resources (PHO), which is up 16.36% year-to-date.

[frenchee]

Expected support area coming up on the daily charts in the iBox.

[frenchee]

Nice move since mid August. See daily charts in iBox. Nevertheless, expect we are getting close to reistance next week or so...