Playing an acknowledged theme - is outperformance possible?

"It's tough to make predictions, especially about the future." - Yogi Berra

Just like a trying to see a lighthouse on a foggy day, trying to clearly envision the future can be tough. However, making out the likely shape and dimensions of those things you are trying to avoid, or aim towards, will likely speed you safely on your journey.

It's like that in investing too. Picking out the broad trends to aim for, or avoid, can help elevate your portfolio returns.

Agricultural commodities are one big, broad, theme going forward. The popular press has recently jumped all over this, pointing to food unrest around the world. While the 'contra the herd" crowd would suggest that any trend reaching the front cover of your favorite pop magazine or newspaper is, most likely, nearly played out, they would probably be not so certain that this trend has.

Examination of the underlying factors suggest that this trend is likely to continue for awhile. Here are the factors, as I see them:

• Continued global population growth - check, this is still ongoing and unlikely to stop for several decades.
• Continued use of food stocks for bio-fuels - check, this is still ongoing. In the US, about 30% of the corn crop is going towards bio-fuel, compared to around 10% in the early 1990's. Given the presidential candidates positions to date, and the strength of the lobbying industry in the US, this appears unlikely to diminish any time soon.
• Diet - a meat-centric diet is a huge consumer of grains for animal feed (it takes anywhere from 5lbs to 18lbs of grain to produce one lbs of meat [depends primarily on meat type]). With a rising middle class in China and India turning away from a formerly mostly vegetarian diet, this will continue to pressure grains. Check, this factor remains in play.
• Arable land is decreasing - decades of industrialization, and of water course management, have reduced the amount of quality arable land available. Growing desertification is also a factor too. Check, this factor remains in play.
• Climate change - long known by scientists to be likely to reduce yield in several ways. Humanity continues to pump out voluminous greenhouse gases, suggesting this factor will only intensify in the future. Check, this remains a factor.

Of course, against those trends, you have to consider the possibility of opposing trends occurring. I see those potentially as:

• Potential reduction in bio-fuel use - a possibility, but with the opposition of vested interests, unlikely within a 10 year window.
• Change in diet - again a possibility, the increasing cost of a meat-centric diet may reduce the volume of meat consumed in some areas,. Yet with this burgeoning middle class in so much of the world, it feels unlikely to occur without some support from government, and people's own conscience. Overall, it feels unlikely to occur much within a five year window.
• Finally, the potential for increased production of foods, due to farmer's using more fertilizers and bringing all available land into production. This, I consider very likely. However, this may very well be offset by the declining yields associated with climate change.

On balance, I'd say that the current trend isn't anywhere near played out, and that agriculture remains a major investment theme going forward. If you agree, then you may very well want to stuff your portfolio with agricultural-related investment products, something I believe will fuel investment returns for a very long period of time.

Full disclosure: Long JJG, MOO, & COW (TSX exchange).

JW

The Confused Capitalist

Agricultural, it's all about the diet ...

Agricultural-related investments remains one of the big, visible, themes going forward over the next ten years. While there's been some mainstream acknowledgement of these major food issues going forward, for the most part, the media has been relatively quiet about the food inflation.

Maybe that's because many countries focus on "core" inflation, which ignores volatile changes in energy and food. These, especially food pricing, are likely to continue to ramp upwards over the next five to ten years.

Feeding the world continues to develop into one of the biggest stories of this century. The supply and demand curves for food, especially due to changing diets in the Far East to have more dairy and meat, continues to favour higher prices for these commodities. Other drivers of agricultural prices are:

- Strong population growth, expected to reach 7 billion by 2013;

- Rising income in developed markets and increased demand for soft commodities in developing markets;

- Climate changes challenging agricultural production processes and product quality;

- Arable land per person is decreasing;

- Demand for agricultural products from Bio-energy (sustainable energy resources) market adds an important and competitive new demand source. Agricultural commodities are getting
more and more important for energy generation.

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This is something I have written about here (provides some specific suggestions, which I continue to support) and here. I re-iterate those calls to make agriculture-related an important part of your portfolio. In Canada, you can now also consider a recent Claymore Investments ETF product, COW, which invests in agricultural companies.

Despite recent run-ups in prices of companies serving the agricultural sector, and the underlying commodities themselves, I consider that this investment theme is still just early in the third inning of a ballgame; a ballgame that itself may even go into lengthy overtime.


JW

The Confused Capitalist

Food Inflation will continue and accelerate

I have written several times about my belief in a movement towards higher food prices in the future, perhaps much higher than in the past. Some commodity experts like the renowned Jim Rogers have stated this belief too.

While I normally enjoy helping investors think about long-term trends that'll help fatten their portfolios, because of the implication this trend has for people everywhere, especially poor people, this posting gives me absolutely no joy.

Nevertheless, here's several ways to invest in what I believe is a long-term trend towards higher food prices:

Van Eck Global's fifth ETF, Market Vectors Agribusiness (AMEX:MOO), which recently debuted and is already up nearly 20% since then. The ETF includes subsectors of the agriculture, such as agricultural chemicals at 34.3% of the index, agriproduct operations, 33.5%, agricultural equipment, 24.3%, livestock operations, 5.6%, and ethanol/biodiesel, 2.3%.

The 40 companies from 13 countries in the index must have a market cap of at least $150 million and a monthly trading volume of 250,000 shares. These companies are primarily engaged in the business of agriculture, and must derive at least 50% of their total revenues from agribusiness. According to information on the fund sponors site (Van Eck), as of Sept 2007, the fund had a PE of ~27, a PB of ~3.5, and a dividend yield of 1.06%.

There are also several ways to invest more directly in the foodstuffs, either through ETFs or ETNs. Two recent products from Barclays (ipathetn) are as follows:

"JJA" tracks the Dow Jones–AIG Agriculture Total Return Sub-Index. The Index is currently composed of seven futures contracts on agricultural commodities traded on U.S. exchanges. The weightings are currently as follows: Coffee 8.0%; Sugar 7.0%; Soybeans 28.0%; Wheat 23.6%; Soybean Oil 9.9%; Cotton 9.3%; Corn 14.3%. According to the information provided by the sponsor, the annual return from the index looks like this: 1yr = 44%; 3yr = 12%; 5 yrs = 6.2%; 10 yrs = -(minus)1.7%.

As you can see, owning the index constituents would have been very good during the past year, and very lousy over the past 10 years.

"JJG" tracks the Dow Jones–AIG Grains Total Return Sub-Index, which has an underlying composition of three futures contracts on grains traded on U.S. exchanges. They are weighted as follows: Soybeans 42.6%; Corn 21.6%; Wheat 35.8%. According to the information provided by the sponsor, the annual return from the index looks like this: 1yr = 64%; 3yr = 14.9%; 5 yr = 6.4%; 10yr = -(minus)1.4%.

Judging by the return differences between the two products over the past year, it appears that the Grains component of the "JJA" ETN (which is 66% of that ETN) has provided almost all of the 44% annual return; in fact, my calculation shows that it's responsible for 41 points of the 44% return.

PowerShares also offers a foodstuff type ETN, DB Agriculture; "DBA".

It tracks the Deutsche Bank Liquid Commodity Index - Optimum Yield Agriculture Excess Return. The index is a rules-based index composed of futures contracts on some of the most liquid and widely traded agricultural commodities – corn, wheat, soy beans and sugar, in equal weightings (i.e. 25% each). However, the weightings in the fund are only periodically rebalanced, and as of October 25 2007, the weightings had changed to as low as 17% for sugar and as much as 31% for soybeans. Index return history as of September 28 2007; 1Yr = 36%; 3yrs = 15%; 5yrs = 11% and 10yrs = 1.6%.

This ETF started trading in January 2007 at $25 and closed at $29.28 on October 26 2007, providing a 17% return since that date.

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Finally, according to recent press releases and web-articles, ProShares is going to be offering a leveraged ETF tracking the Dow Jones-AIG Agricultural Index. When they start trading, this will offer the opporunity to track the index, but on a double-leveraged basis. The release date of the ETF isn't known at this time. Expect a one to four month delay as typically seen.

I have written previously about the food inflation issue, and it's worth re-visiting two of my postings, here and here for more background.


JW

The Confused Capitalist

Thinking Ahead: Ten Years Out

One of the themes I've tried to engage readers in here, is that by playing some fairly obvious trends, and coupling those with reasonable valuations, is a relatively easy way to outperform the market.

One theme I've pounded on over the past one-and-a-half years is the emerging market theme. It doesn't take too much heavy lifting in the thinking department to realize that with soaring GDP growth rates of 8-12% annually in some of these countries, expecting their stock valuations to follow isn't much too much of a mental stretch, even for weak thinkers like me.

So, thinking ahead, and about 10 years out is a good target, it becomes much easier to think that an overweighted emerging markets position is likely to be both prudent, and very profitable. Now, the graphic above showing firestroms in California (currently displacing one million people) obviously suggests that this posting isn't about emerging markets.

That's correct - this is about alternative energy production. While climate change and global warming have been warned about and was easily readable in the popular media 20 years ago(Time Magazine, for instance, awarded Planet Earth as "Man of the Year" in 1989, due primarily to concerns about global warming), it's only recently that most people are finally waking up to the severity of the problem.

As the problem continues to grow in the public mind, so too will the demand for solutions. These will be invoked on a political and individual basis. As the negative consequences of inaction become more and more and more visible and the predictions more dire, many will begin making personal change AND demanding societal change. This is inevitable.

Note: If you're on a blog aggregator, you can visit The Confused Capitalist here (or here: http://confusedcapitalist.blogspot.com/) for additional articles and exclusive content!)

What is also inevitable is major changes to our type of energy consumption and to the pattern of use. For instance, emerging economies will begin to use far more energy than in the past. This is good for them, but not good for the planet. The energy hogs of the planet - that's us in the western world - will finally begin to reduce consumption outright - not just on GDP weighted basis. Since we were "first in" to this pattern of inefficient energy use, it also is right that we strive to be "first out" of the pattern.

This brings us to our investment opportunity. Looking ten years, does anyone see a world in which the general populace isn't pressuring the politicians to fund alternative energy, to create incentives/disincentives to change energy use, and possibly even to restrict certain types of energy use? Perhaps rationing, a popular method for "spreading the pain" and acknowledging that we're all in this together, will become popular.

In any case, I personally cannot envision a world in 10 years where alternative energy isn't a significantly larger economic sector than it is today.

Of course, my much beloved ETFs provide a way to play this trend while avoiding single company risk. The recent launch of three ETFs targeting this sector might lead some to utter the usual cliques and say that this is a clear sign that this market segment has "topped". Yet the reasonable valuations, societal trends, and my common sense, tell me "no", that is not the case at all. And that is why I am willing to significantly overweight my portfolio to this segment.

While I do not pretend this is a comprehensive list, here are three ETF names in this sector:

Market Vectors Global Alternative Energy ETF (GEX) started trading on the New York Stock exchange. The fund, tracks the Ardour Global index (Extra Liquid), which is comprised of stocks in 30 publicly traded companies engaged in alternative energy production. These stocks are selected from a stable of 250 companies in this space. At least 30% of the names are not US-domiciled companies, and may therefore be attractive to those wishing some diversification out of the US currency. It is however, a relatively concentrated ETF, with 60% of the value being held in the top ten positions. Yahoo Finance shows the current PE as ~30.

Power Shares Global Clean Energy Fund (PBD) is based on the WilderHill New Energy Global Innovation Index. The Index seeks to deliver capital appreciation and is composed of companies that focus on greener and generally renewable sources of energy and technologies facilitating cleaner energy. The modified equal weighted portfolio is rebalanced and reconstituted quarterly. It currently holds 84 positions. It also has limited exposure to US companies, with only 26% of the ETF having US domiciled companies. Yahoo Finance shows the current PE as ~26, while information from PowerShares says the PE is ~42.

Finally, an all US domiciled companies is the First Trust NASDAQ Clean Edge ETF (QCLN)which started trading in February, covers five sub-sectors of the alternative energy industry: renewable power generation, renewable fuels, energy storage and conversion, energy intelligence, and advanced energy-related materials. The investment has above average concentration, with the top ten positions holding 55% of the value. It seeks to track the NASDAQ Clean Edge U.S. Liquid Series Index. Yahoo Finance reports the PE as ~25.

One caution with all of these ETFs is that they are presently quite small, none having assets of more than $100 million. But I predict that will change dramatically by the time 2017 has rolled around. Clean energy - a future whose time is now for the investor.



JW

The Confused Capitalist

Raising the Median: Computer Hardware and Software

Image Source: MadAsHellClub.Net

I'm mad as hell and not going to take it any more! (Well, not really, but I am more than a bit disturbed [ask anyone who knows me] :-)

In any case, I've kind of had it with computer hardware and software makers who don't promote better ways to do things and perpetuate the mediocre or inferior.

One obvious example of this is the present keyboard you are probably typing on (just as I am). It's antiquated and inferior in two very obvious ways:

• Firstly, the actual locale of the letters on the QWERTY keyboard layout, is a relatively slow method to type (created to slow typing down, so 18th century typewriters wouldn't jam). Because of this crappy letter layout, Repetitive Strain Injury (RSI) is epidemic among those regularly using keyboards. Additionally, it's a slow way to type, compared to several more modern alternatives, particularly a fairly new one that takes advantage of prior Qwerty training, while minimizing re-training time compared to using a Dvorak keyboard.


• Secondly, the flat keyboard, with its offset letters, also contributes to RSI, to a higher error rate, and was something that was designed for the actual mechanics of a typewriter, never for the human being. That the computer makers chose to perpetuate this too when manufacturing computer keyboards, is even more unbelievable.

So, in relation to item #1 above, a Dvorak layout (which many of you may have heard about) is far superior to the standard Qwerty layout and results in superior speed (the world's fastest typist used a Dvorak layout), and less RSI. However, the problem is, is that almost every key (33 of them) is recast elsewhere on the board, with many also jumping between hands.

This results in a steep time-consuming learning curve, and many people give up because of this (as I did), even though you can easily reconfigure your keyboard through a software add-on (go to Microsoft, here, if interested). This is probably the reason that the Dvorak never caught on - the very steep learning curve.

No, based on this idea though, others have been at work to recast the keyboard letters, using the lessons of Dvorak, but minimizing extraneous key movement from the Qwerty standard, where gains are minimal. In the case of the Colemak layout (moves only 17 keys, and minimal moved to the "other" hand), this results in, reportedly, much smaller learning curve, with similar speed and ergonomic gains to Dvorak.

It is now the third-most popular English language layout, and is gaining converts every day. More information, including a downloadable program to convert your existing keyboard to this superior letter layout is located at Colemak.com. I hope to download and convert to this layout. I'll report out on this from time to time.

(Note: If you're on a blog aggregator, you can visit The Confused Capitalist here or here [http://confusedcapitalist.blogspot.com] for additional articles and exclusive content!)

Keyboard layout comparisons (click to enlarge any of the below):

QWERTY (The old-fashioned, crappy, standard)

DVORAK (A better keyboard, that never caught on, probably in part due to the learning curve - look how many keys not only shift position, but from one hand to the other).

COLEMAK (With some luck, this will become the defacto standard, particularly with young people. Note how many Qwerty positions are retained, because moving them doesn't create significant improvement and moving them needlessly creates more difficulty in learning a new board layout for old-timers, like me)


So if you're looking to be a faster typist, to alleviate your own RSI, and just generally to make the world a better place, head on over the Colemak.com for a free download to covert your keyboard. OK, that's Rant #1 over. Let's move onto Rant #2.

Secondly, the actual keyboard itself sucks! The hardware makers should have corrected the obvious deficiencies in this, once there was no mechanical reason to retain the "offset" configuration. It results in missed keys, too much finger stretching, and incorrect wrist position, among other problems. The Confused Capitalist has been researching this issue however, reading reviews on the net, and believes to have found a superior board.

While some boards split and twist the keyboard (like the Microsoft Ergonomic that I use at work) which solves part of the problem, it still leaves a large portion of the ergonomics unfixed. However, a newer board, called the SmartBoard, solves most of these problems and adds several other key fixes, as well. The SmartBoard is available from datadesktech.com - see image below.

Finally, rant #3, isn't really a rant, but more of an eye opener. Many people use the Microsoft Office programs without believing there's any real alternatives out there. Well, Open Office has been picking up speed lately, and similar in some ways to Linux, converts. It is a free, volunteer-maintained open source program, providing an array of office suite type products. By all accounts on the internet, the latest release is continuing to improve and now rivals most of the Microsoft suite for utility, versatility, sophistication, stability, etc.

In some cases, some of the programs are reported as superior, with the most notable complaints being for the Power Point equivalent "Impress" still not up to the Microsoft standard, while the spreadsheet program "Calc" isn't - for sophisticated users - as good as Excel. However, huge strides have reportedly been made over the prior release. According to my research, many users are reporting that they prefer the Open Office word processor. You can go to OpenOffice.org to download this FREE program. So, even if a couple of the programs aren't quite there yet, it's not hard to think they will be soon.

Oh, and did I mention that Open Office can both properly read and save back into a Microsoft format? So my only question would be - unless you have very sophisticated spreadsheet or presentation needs - why on earth would you spend the bucks to upgrade to the latest Microsoft suite?

By the way, many of you might note the label "Global Warming" below, and wonder how this bloggering possibly ties in with that theme. It's simple really - any improvement in efficiency offers the possibility of turning off the computer sooner, and therefore reduces power consumption. Further, less RSI means fewer trips to the doctor. Ergo, less greenhouse gas emissions.

Secondly, using Open Office, an open source document, means that you don't - perhaps - have to work quite as much, since you don't need to pay for this particular type of product. Ergo, the potential exists for a couple of less trips to work every other year. Times millions of workers = less greenhouse gas emissions.

Perhaps not obvious connections, but ones which can, and I believe, do, exist.

Well, that's it for now - I have all of these links on the right hand side of my blog, under the title "Computer Stuff". I hope you are able to use this to improve your own life - to "raise the median".


JW

The Confused Capitalist

Happy Birthday to me ... to me .... to me ....

Just like an unruly child, the Confused Capitalist has passed his first birthday on this earthly plane (... this blog was started February 18 2006), with a happy smile on his face.

Hopefully, I've written something a little bit different from everybody else and something that others have found worthwhile; I've generally had fun doing this. A promotion in the latter part of last year kept me busier than usual, hence the relatively infrequent blogging over the past six months.

However, as the Confused Capitalist enjoys writing both as a means to learn, self-inform, and teach others, I will be launching an environmental/global warming blog later this year. I hope some of you might wander over there when this is launched for some ideas, insight and discussion as we move towards a sustainable future, before all the natural systems begin completely failing.

In the meantime ... happy birthday to me ... happy birthday to me ... to me ... :-)


JW

The Confused Capitalist

Raising the Median - Gas Mileage - Global Warming

In light of this morning's posting, I'll offer up a very small suggestion. Reduce your global warming load with a cheap bike conversion.

200 mpg, 20 mph+. All for a $400 conversion. Paid for once you've saved the cost of five fill-ups for your SUV.

Great for those small trips under six or seven miles or so. Fifty dollars gets first crack at it! As seen in Popular Science.

Better and cheaper than a Segway.

More here on the revolution.

And since this IS an investment blog, the extra savings you can put into the market. (OK, it's weak, I know, but hey ... you've got to try ... can't give up ...)

"I am only one, but still I am one. I cannot do everything, but still I can do something; and because I cannot do everything, I will not refuse to do something that I can do."

- Helen Keller


JW

The Confused Capitalist

Investing in a Hothouse World

I often lament to some friends that I don't understand why a few souls don't seem to get the whole "global warming" thing. For those of us in the great white north (Canada), we are well aware of how dramatically our winters have changed over the past twenty years.

Because of this dramatic change, most folks here don't subscribe to any of the junk science school of thought claiming that global warming is either:

1. Not occurring, or
2. Due to naturally occurring phenomena

To most of us Canadians, it's pretty clear what's going on. Recently, asset manager Eric Sprott of Sprott Asset Management, a firm with $3.4 billion under management, weighed in with a 56 page missive, entitled Investment Implications of an Abrupt Climate Change. In that document, Mr. Sprott says it's "shockingly clear" we've caused a spike in greenhouse gases, and further says that ...

"We are now in uncharted territory and may well be on the cusp of a warming of the planet at a rate well beyond what can be predicted using our limited knowledge of history."

Mr. Sprott considers further trends such as the massive industrialization of much of the world's remaining rural populations, and other trends in place as not projecting a bright future for the planet. Water shortages, food shortages, droughts, too much rainfall in places, rising sea levels, ever accelerating weather change, etc. Pretty much the usual bane of stuff that we manage to ignore every day, without too much thought or effort.

In any case, a goodly portion of the paper is directed to current statistics, events, and trends relating to global warming. (But I must tell you I learned something new: the paper suggests that the melting of the permafrost and its' sequestered methane gases as being an absolute tipping point - page 25 is a must read page).

By page 28, Mr. Sprott arrives at the investment risks and opportunities. He suggests the following sectors are at risk, if there is a 20% emissions constraint regulated:

• Automobile
  
• Chemicals
• Electric utilities
• Metals and mining
• Oil and Gas
• Banks (some banks have high rates of commercial loans, whose clients may be subject to various types of business risk from global warming)

Unfortunately, Mr. Sprott doesn't offer too many investment opportunities. He points to obvious ones, such as nuclear, wind and solar power as being some. He suggests however, that the ethanol craze is just adding to the global warming load (production of ethanol fuels requires more energy inputs than they produce), and that hydrogen as a fuel isn't quite ready for prime time. He suggests that micro power projects may offer some potential as well.

Finally, he suggests a hyper-inflationary environment could ensue at some point, thereby accelerating demand and prices for commodities in general, and gold in particular.

As one sentence in the document points out, a Swiss Re (insurance) executive stated that ...

"Global warming has accelerated from a problem that might affect our grandchildren, to one that could significantly disturb the social and economic conditions of our lifetime."

In light of this, may I suggest one further solution we can provide as investors? Perhaps directly investing a very small portion of our investable assets, towards some source of lowering the warming load. Whether this is in a company that is in nuclear, solar, wind power, or any other investment that lowers or reduces the warming load, it doesn't really matter. By helping to provide more abundant equity available, we'll help spur the advance of technologies to save the life of this planet. Sometimes we have obligations beyond that just of short-term investors - we have obligations as human beings.

May I suggest 1/10 of 1% of your investable assets this year, or a minimum $100, increasing by a similar amount every year for nine more years? Consider it a donation - a donation in an area we have special knowledge and awareness in - the investment field. If we wait too long, the cost may be far, far too high.


The Confused Capitalist

Raising the Median - Global Warming

For those who remain uncertain about global warming this news item just in: Canada shatters record for warmest winter ever recorded.

Canada shattered the record for the warmest winter ever, blowing away it away; its winter temperatures were some 7 degrees (Fahrenheit) above normal, and in the more northern parts of the country, it was closer to 12 degrees above normal. This is just as I have read since the mid-1980s, when the then feeble computers and climate science predicted that the far northern reaches of the planet would experience the most extreme shifts in weather.

I don't think I need to re-hash the debate from the fake science side, nor to get into a debate about other potential causes. Whatever might be contributing to the warming, it is occurring and we do know how to do something about it. We can have an influence on the rate of warming, at the very least, and at best, begin implementing long-term strategies aimed at reversing the damage.

Now, I know many of you are stock market aficionados, often with an interest in the underlying business fundamentals that makes picking stocks so interesting. I think that if many of you were looking at "The World, Inc.", what you'd see is a "deep value" investing situation. On the surface, there's lots of things wrong with the business - and perhaps it's on the verge of bankruptcy - but underneath, you believe that there's a very viable "turn-around" situation. However, an experienced turn-around CEO would probably be needed to review all the existing systems and to plan strategies for the survival of the business.

Environmentally, the litany of problems is well known, so I'll just focus on how some issues relating to global warming might be overcome.

Firstly, let's face it, national governments haven't shown much stomach for implementing some of the necessary remedies. Some of these would include national mass transit systems, city-to-city, that make rapid transit alternatives like bullet trains a real alternative to ozone-destroying and massive-polluting airplanes. I mean if people must commute back and forth between cities for business, let's build some environmentally-friendlier ways. Others would include very high standards for vehicle gas mileage, and national solutions for drastic reductions in global warming gases of all sorts.

But I digress. My focus is much more what can be done on the local (city) level and the state/provincial level. Here, taxes of all sorts could act as a disincentive to single-occupant vehicles and particularly the larger vehicles that produce 2-5 times as much warming gases as smaller efficient vehicles. The taxes could then be used to build out great transport systems, that could act as a real, viable, convenient, alternative to the single-occupant car.

Next, what about all our buildings? Of course, there's the usual array of energy-saving devices that could be outfitted - yes, some are more costly initially, but we need to think long-term here. Mandating a certain level of energy-efficiency in every new building on a local building code level - and backing it up with mandatory testing - could go a long way to producing a lower level of energy use.

And what about all the wasted space of building walls and roofs? How about mandating on a local building code level, that every building is required to produce 20, 30, 40, or even 50% of its own power usage, on site? This means making all those spaces more functional, equipping them with solar panels, mini-windmills, or other energy-creating devices - perhaps some yet to be invented. And of course the state governments would mandate that the surplus power created could be sold back "into the grid", thus further helping reduce other fossil-fuel use.

How about mandatory geo-thermal heating for all new buildings, which cuts heating costs in cold climates, and air-conditioning costs (and the associated global-warming gases too) in hot areas?

How about further mandating green roof systems in local building codes, where those systems make sense?

If we don't start acting very, very, very soon, the price will be too high - warm winters in Canada, and more of these things cleansing the Gulf Coast and Eastern US Seaboard of humanity and habitable areas ...

More resources: I highly recommend that you check out the following sites for practical ideas ...

1. The respected Rocky Mountain Institute founded by Amory Lovins (full of practical ways to better respect the earth's capacity); and
2. Greenpeace's climate change pages
   

In short, there's a whole lot that could be done, immediately, on local and state levels, without waiting for the inertia of national politics to be overcome by perennial disastrous occurrences.

As one final comment, we - as a society of peoples - need to recognize the reality of the last 100 years. That is, that we are more like the world's largest colony of ants and take advantage of that fact, rather than act like we're all single solitary foraging bears - the way we've built-out a lot of our systems to date.

Environmentalists - Raising the Sustainability Median!


JW

The Confused Capitalist

Energy Demand: Nuclear Renaissance?

As investors, it pays to be ahead of the rest of the investing crowd. Nuclear energy may offer one such option. While the focus of the Wall Street crowd today is oil and gas, future gains in uranium may vastly outstrip those remaining in the oil and gas field.

Today, it's estimated that, in addition to the 440 operational nuclear plants around the world, there'll be another 60 on-line to serve the growing world-wide energy demand, by 2020. Additionally, some environmentalists, such as James Lovelock, Ph.D., now embrace nuclear power as the only way to avoid complete environmental catastrophe. Add to that the obvious demand that will continue to occur as China's and India's 2.2 billion citizens become part of industrialized societies and the demand side of the equation is obvious.

What is less obvious is that the uranium industry has been undermining for years, perhaps even decades now. This deficit, currently estimated, at about 25 million pounds annually (of a total demand of 150 million pounds), has been met by the over-stockpiling of uranium from the 1950s-1970s, and by the decommissioning of Soviet nuclear weapons in this decade and the 1990s.

However, the "well is running dry", so to speak as these sources are themselves being drained. All of which leads us to a long-term investment thesis, of uranium producers experiencing very good gains for a lengthy time period, perhaps as long as ten years. Uranium mine approvals, world-wide, are subject to obvious governmental red-tape and this is only overcome at considerable time and expense.

In the interim, sit tight and enjoy what I believe will be superior medium to long term investment gains. The largest global producer of uranium is Cameco, on the NYSE as "CCJ".


JW

The Confused Capitalist