Investing In Water

Money For the Rest of Us

J. David Stein

Investing, Investing Podcast, Business, Economics, Economy

4.5 • 1.4K Ratings

🗓️ 2 June 2021

⏱️ 28 minutes

🔗️ Recording | iTunes | RSS

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Summary

What are ways to invest in water and is it an attractive investment?

Topics covered include:

How water rights work and how they have been overallocated in the Colorado River basin.
Why agriculture uses the vast majority of water in the southwestern U.S. while contributing only a few percentage points to the region's gross domestic product.
Why hedge fund manager Michael Burry invests in farmland instead of water rights.
What ETFs are available to invest in water
What have the historical returns been for water stock investing, what are current valuations, and what is the expected long-term revenue growth.

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Show Notes

Beyond the Signing by Laura Paskus—Water Education Colorado

Where the Water Goes: Life and Death Along the Colorado River by David Owens

What Happens When The Colorado River Runs Dry—Science Friday

Editorial: There is no drought by The Times Editorial Board

New Mexico’s coming megadrought highlights farmers’ control of water by Cody Nelson, Capital & Main—New Mexico Political Report

Arizona | The Economic Contributions and Impacts of U.S. Food, Fiber, and Forest Industries—University of Arkansas Department of Agriculture

U.S. Southwest, Already Parched, Sees ‘Virtual Water’ Drain Abroad by Diana Kruzman—Coyote Gultch

Brazil’s Worst Water Crisis in 91 Years Threatens Power Supplies by Walter Brandimarte and Gerson Freitas Jr—Bloomberg Green

Does Arizona really use less water now than it did in 1957? by Andrew Nicla—azcentral.

Arizona’s Groundwater Management Act at Forty: Tackling Unfinished Business by Kirsten H. Engel, Esther Loiseleur, Elise Drilhon

Michael Burry, Real-Life Market Genius From The Big Short, Thinks Another Financial Crisis Is Looming—by Jessica Pressler—Intelligencer

Global water crisis: Investing in water—Fidelity

Related Episodes

301: Use Caution with Alternative Investments

334: How To Invest In Farmland

336: Own What Is Real

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Transcript

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0:00.0	Welcome to Money for the Rest of Us. This is a personal financial on money. How it works,
0:06.4	how to invest it, and how to live without worrying about it. I'm your host, David Stein,
0:11.4	today's episode 345. It's titled, Investing in Water. A couple years ago, I received an email
0:20.6	from a listener that owned 25 shares of water rights in Southwestern Colorado in the four corners
0:27.3	area where the states of Arizona, Colorado, New Mexico, and Utah meet. Her rights weren't
0:34.3	attached to any parcel of land. They were senior rights or sometimes called golden rights,
0:40.0	in that they predated the Colorado River Compact of 1922 by several decades. The water was from
0:48.7	snow melt from the San Juan Mountains. The Colorado River Compact is an agreement dating back to
0:56.6	1922 among seven US states in the Colorado River Basin. It governs how the water from that river
1:05.3	is allocated. When the agreement was set up, the Colorado River Basin was divided into an upper
1:13.2	basin consisting of seven and a half million acre feet per year of water, about half of which
1:20.5	went to Colorado, 23% to Utah, and then lower allocations to Wyoming, New Mexico, and just a small
1:27.7	amount to Arizona. The lower basin was also allocated seven and a half million acre feet of water
1:35.0	per year. With California getting 59% of that lower basin allocation, Arizona 37% and Nevada 4%.
1:46.4	There is an additional 1.1 million acre feet in surplus that goes to the lower basin,
1:52.9	plus 1.5 million acre feet to Mexico. 1922 was a long time ago. Today, there are more than 40
2:01.3	million people in two countries that depend on the Colorado River. The Colorado originates in the
2:07.3	western slope of the Rocky Mountains, major tributaries to the Colorado include the Green River,
2:13.3	Gunnison, the San Juan River, where this particular listener had water rights, and then major
2:19.3	cities depend on it. Denver, Los Angeles, San Diego, Phoenix, Tucson. US is two largest hydroelectric
2:28.1	plants. The Hoover Dam and the Glen Canyon Dam are also on the Colorado River. Arizona,
2:34.7	where we live, most of the year, gets a significant percentage of their water from the Colorado River
	...

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