But if you can set aside peak oil and the indisputable global food crisis for a moment, I want to talk about another threat facing the global economy. In fact, in my opinion, it’s the #1 threat to the global economy: the scarcity of fresh water.

This precious resource is also running in short supply. There’s no argument that water is much more necessary to life than oil. Without water, we die. Without oil…well, we learn to use bio-fuel… or bicycles.

Forget Peak Oil… What about Peak WATER!

Here in Florida, we’re already rationing our water, like many other areas around the world. Even as our “rainy season” begins, I’m restricted to watering my parched front lawn just two days per week. But that’s a very mild inconvenience compared to what’s going on in other parts of the world – and what’s likely to happen in the very near future here in the United States…

Due to global warming, glaciers in the Himalayas are melting fast. That’s bad news for emerging Asia, because a few hundred square miles off the Himalayas is the source for ALL the major rivers in Asia – home to nearly HALF the world’s population.

In places like Florida, where vast underground aquifers supply ALL our fresh water, rainfall isn’t enough to refill the sub-surface water tables.

It turns out water isn’t a “renewable” resource after all. Or at least Mother Nature is not renewing it fast enough to keep up with soaring demand.

“Demand for water continues to escalate at unsustainable rates” according to a recent Goldman Sachs report. “Globally, water consumption is doubling every 20 years. By 2025, it is estimated that about one third of the global population will not have access to adequate drinking water.”

Aging Infrastructure Leads to Short Supply

Water is running in short supply. It’s a global issue, and it’s approaching crisis dimensions. Consider that…

• Billions of people – don’t have access to reliable fresh water supplies
• The U.S. alone needs up to US$1 trillion in new water pipes and waste treatment plants by 2020.
• Half of the world’s population – will live under conditions of “severe water stress” within the next two decades.
• Water is also a vital industrial resource, used in the production of many other goods. For instance, it takes about 1800 gallons of water to produce a pair of jeans, 400 gallons to produce a cotton shirt, and 150 gallons for the Sunday paper.

The fact is, we’re consuming water faster than we can tap new fresh water resources. This growing crisis in the world’s fresh water supply means major profit opportunities are in store for companies working to find solutions.

Part of the solution involves building out new water infrastructure in developing nations where an estimated US$50 million a day will be invested on water supply projects over the next few decades. Meanwhile, aging water systems in modern countries are leaking like a sieve. They badly need infrastructure updates.

Global Water Crisis Will Trigger a Tidal-Wave of Spending

The World Water Council estimates that developing nations alone will need US$4.5 trillion in water infrastructure investment over the next 25 years alone. And this isn’t just a third-world problem…

In modern industrialized countries, municipal water systems put in place centuries ago are woefully inefficient and falling apart at the seams.

In Europe, most pipe systems date from before World War I and many haven’t been upgraded since then. These leaky pipes lose 40% to 60% of Europe’s drinking water before it can be used.

In U.S. municipal water systems 30% of the pipes are between 40 and 80 years old…another 10% of pipes are over 80 years old. As a result, about six billion gallons of treated water leak from American water systems every day.

The global water crisis may soon end up grabbing the headlines away from soaring food prices and sky-rocketing energy costs. This will result in an unprecedented spending boom of more than US$5 trillion over the next 20 years, according to estimates.

That’s about US$250 billion in water-related spending every year – a very big opportunity to profit if you know where to invest…

I’ll be watching this trend very closely over the next few months. Please stay tuned for updates.

MIKE BURNICK, Senior Editor & Global Markets Analyst

P.S. In my research, I’ve discovered one fund that invests in 50 different water treatment and infrastructure companies. In my opinion, it’s the absolute best way to profit from what’s quickly becoming a global issue. Look for full details on this dynamite play coming in the July issue of The Sovereign Individual. Don’t receive our members-only newsletter? Click here to sign up for the next 12 issues – for pennies a day.

Source: Why This Scarce Resource is Also the #1 Investment Opportunity of the 21st Century

The European Union has set a target date of 2020 for 20% of its energy to come from renewable sources. The British Wind Energy Association said Britain will contribute 15%, meaning up to 40% of the country’s power will come from wind energy by the target date.

“The richest investment opportunities can be found in the fast-emerging alternative energy sector,” says Mike Burnick in The Offshore A-Letter.

That’s where oilman T. Boone Pickens is putting his money – his company Mesa Power just placed an order for US$2 billion in wind turbines. And there’s much more profit potential in other parts of the alternative energy sector too – especially alternative fuel.

• The market for ALL alternative energy sources grew 40% last year alone to US$77.3 billion and will explode into a US$250 billion industry within 10 years.
• Bio-fuel grew to a US$25.4 billion market last with more than 15 billion gallons of ethanol and biodiesel produced globally – more than double the output of just four years ago.
• The worldwide Bio-fuel industry will continue to enjoy explosive growth for years to come – expanding into a US$81 billion business within the next 10-years!

But you don’t have to wait two decades or even two years to start making serious money from this energy-sector market shock…

Fossil fuels are dead – the future belongs to alternative energy. Vast fortunes will be made in the “great fuel revolution!”

Investing in established wind energy stocks stocks is a great way to profit, says Charles Delvalle in Investor’s Daily Edge:

It seems to me that investing in green stocks is a great thing to do. What you want to do is avoid the companies that have no profits… the ones that are using very experimental technologies that haven’t been proven yet. These companies may do well in the future, but you take a huge risk by putting your money on them now.

If you think investing in clean energy is a bad idea, just take a look at the Market Vectors Global Alternative Energy Fund (GEX) and you’ll see that the sector’s been clearly moving higher. And the PowerShares Global Clean Energy Portfolio (PBD) has been doing the same.

Shares in leading German solar stocks rose substantially on expectations that other big players, including oil groups, are on the prowl in a market that grew to €6.6bn last year and is forecast to top €18bn by 2020.

Germany is by far the world’s biggest solar energy market thanks to its “feed-in” tariffs, which pay a government-guaranteed premium of up to €0.47 a kilowatt hour for power produced by photovoltaic panels. It is expected to continue to grow despite government plans to cut subsidies by 8% or 9% in 2009 and 2010.

“The richest investment opportunities can be found in the fast-emerging alternative energy sector,” says Mike Burnick in The Offshore A-Letter.

“That’s where oilman T. Boone Pickens is putting his money – his company Mesa Power just placed an order for US$2 billion in wind turbines. And there’s much more profit potential in other parts of the alternative energy sector too – especially alternative fuel.

“The market for ALL alternative energy sources grew 40% last year alone to US$77.3 billion and will explode into a US$250 billion industry within 10 years.

“Bio-fuel grew to a US$25.4 billion market last with more than 15 billion gallons of ethanol and biodiesel produced globally – more than double the output of just four years ago. The worldwide Bio-fuel industry will continue to enjoy explosive growth for years to come – expanding into a US$81 billion business within the next 10-years!”

“The richest investment opportunities can be found in the fast-emerging alternative energy sector,” says Mike Burnick in The Offshore A-Letter.

“That’s where oilman T. Boone Pickens is putting his money – his company Mesa Power just placed an order for US$2 billion in wind turbines. And there’s much more profit potential in other parts of the alternative energy sector too – especially alternative fuel.

“The market for ALL alternative energy sources grew 40% last year alone to US$77.3 billion and will explode into a US$250 billion industry within 10 years.

“Bio-fuel grew to a US$25.4 billion market last with more than 15 billion gallons of ethanol and biodiesel produced globally – more than double the output of just four years ago. The worldwide Bio-fuel industry will continue to enjoy explosive growth for years to come – expanding into a US$81 billion business within the next 10-years!”

“The days of meeting an unchecked demand for energy through monolithic carbon intensive power stations are coming to an end. Increasingly the emphasis will be on energy efficiency, renewables, cleaned up fossil fuel plant and micro generation,” the company said in a statement accompanying its full-year results, according to Britain’s The Guardian newspaper.

SSE, which currently gets 15% of its energy from nuclear suppliers, said it believed “one more tranche of nuclear power stations will be necessary, but that the deployment of such power stations should be minimised through the maximum exploitation of renewable energy sources.”

“The richest investment opportunities can be found in the fast-emerging alternative energy sector,” says Mike Burnick in The Offshore A-Letter.

“That’s where oilman T. Boone Pickens is putting his money – his company Mesa Power just placed an order for US$2 billion in wind turbines. And there’s much more profit potential in other parts of the alternative energy sector too – especially alternative fuel.

“The market for ALL alternative energy sources grew 40% last year alone to US$77.3 billion and will explode into a US$250 billion industry within 10 years.

“Bio-fuel grew to a US$25.4 billion market last with more than 15 billion gallons of ethanol and biodiesel produced globally – more than double the output of just four years ago. The worldwide Bio-fuel industry will continue to enjoy explosive growth for years to come – expanding into a US$81 billion business within the next 10-years!”

Floyd Brown in Investment U looks at another alternative energy source: the Fischer-Tropsch process, used to create synthetic fuels.

“The process works like this: Coal is broken into its components by subjecting it to high temperature and pressure, using steam and measured amounts of oxygen. This leads to the production of synthetic gas.

“In the United States, a small firm provides technology to produce ultra-clean synthetic fuels and chemicals. It licenses its proprietary derivative process from the Fischer-Tropsch method.

“It converts synthesis gas derived from coal, petroleum coke, biomass, natural gas, or municipal solid waste into liquid hydrocarbon products. This includes ultra clean diesel fuel, jet fuel, naphtha, specialty chemicals and other fuel products. It also manufactures anhydrous ammonia, UAN, nitric acid, carbon dioxide and granular and liquid urea.”

Read on here to find out Floyd’s cashing in on this conventional energy alternative.

I have been extensively researching the global energy crisis that’s now underway. My research is uncovering some very interesting investment candidates with lots of profit potential. The interesting thing is…NONE of these firms are traditional big oil & gas firms that investors are so fond of.

Crude oil soared as high as US$135 a barrel last week – more than double the price of a year ago. But big oil firms like ExxonMobil WILL NOT be cashing in on the next phase of the energy boom.

Instead, the richest investment opportunities can be found in the fast-emerging alternative energy sector.

That’s where oilman T. Boone Pickens is putting his money – his company Mesa Power just placed an order for US$2 billion in wind turbines. And there’s much more profit potential in other parts of the alternative energy sector too – especially alternative fuel.

• The market for ALL alternative energy sources grew 40% last year alone to US$77.3 billion and will explode into a US$250 billion industry within 10 years.
• Bio-fuel grew to a US$25.4 billion market last with more than 15 billion gallons of ethanol and biodiesel produced globally – more than double the output of just four years ago.
• The worldwide Bio-fuel industry will continue to enjoy explosive growth for years to come – expanding into a US$81 billion business within the next 10-years!

But you don’t have to wait two decades or even two years to start making serious money from this energy-sector market shock…

Fossil fuels are dead – the future belongs to alternative energy. Vast fortunes will be made in the “great fuel revolution!”

MIKE BURNICK, Senior Editor & Global Markets Analyst

P.S. I’m pulling the trigger on my first market-shock recommendations to take advantage of the great fuel revolution. My first pick is a renegade oil firm that develops “HemiCell-190″, which already powers 2.6 million cars. My second selection is a “giant killer” that just scooped-up gold-mine in alternative energy assets that ExxonMobil threw away. Subscribers to my signature research investment service Market Shock Trader will be hearing from me about even more ways to profit. Very soon, I’ll be sending them specific rifle-shot plays to cash in on alternative energy!

Source: Legendary Oil Man Turns Back on Oil

There’s also another crisis brewing at the moment – that’s becoming more painfully obvious with each passing day: A global energy crisis! In many ways, the two are closely connected…

U.S. corn-based ethanol production is a big reason why corn prices surged 56% higher in the past 12 months alone. About one-third of the entire U.S. corn crop is being diverted from kitchen tables to gas tanks.

As a result, people are rioting in poor countries around the world. They’re taking to the streets in protest over U.S. corn-based ethanol. They complain bitterly that we are trading THEIR food for OUR fuel. But there is a better way…

In fact, there is an “emerging” alternative bio-fuel source that is a lot more efficient than corn-based ethanol, and doesn’t require the same food vs. fuel trade-off.

In fact, Brazil is leading the great fuel revolution – with sugar cane-based ethanol…

Brazil’s Big Ethanol Advantage

Brazil is far and away the global leader in ethanol production technology. In fact, the country began large-scale development of ethanol as an alternative fuel source amid the oil shock of the late 1970’s and early 80’s.

Today, ethanol accounts for 50% of Brazil’s total annual automotive fuel consumption. More than 70% of new cars sold in the country are flex-fuel capable. That means they’re able to run either on gasoline, ethanol, or some combination of the two.

Currently, Brazil is the world’s second-largest ethanol producer, and largest exporter, with total output of about six billion gallons a year.

The country has its sights set on becoming the dominant global exporter of ethanol by 2020. Brazil’s global ethanol exports could total as much as 200 billion gallons a year within that time – that’s over 30-times today’s ethanol production. Talk about a growing industry!

U.S. and Europe Just Can’t Compete with Brazilian Ethanol

Brazil enjoys a big advantage over other nations – as the world’s lowest cost ethanol producer. As shown in the graph above, Brazil can distill bio-fuels from sugar cane at a significant cost advantage to other nations.

Neither U.S. corn-based ethanol, nor wheat-based ethanol from Europe, can come close to matching the Brazilians on a production cost basis.

The sugarcane plant, which flourishes in Brazil’s tropical climate, produces a “yield” of 6,000 liters of ethanol per hectare of land. That’s about twice the yield of corn-based ethanol!

In fact, Brazilian ethanol is about 40% cheaper to make than in the U.S. – and costs less than half the price of European ethanol.

When Trade Tariffs Fall, Brazilian Ethanol Will Flow

Of course Washington, in their infinite wisdom, maintains silly trade tariffs equal to 54-cents a gallon on imported ethanol. This ridiculous trade barrier benefits a relatively small number of U.S. corn farmers at the expense of millions of American drivers.

In spite of this, Brazil’s largest ethanol export market remains the United States. In fact, Brazil shipped us more than 430 million gallons of ethanol last year – up fourfold from 2004! Wholesale gasoline prices in the U.S. are leaping above US$4 a gallon, and will keep spiraling higher as crude oil goes through the roof during what’s shaping up to be a long, hot summer.

Naturally, pressure is mounting for Congress to eliminate this silly, protectionist ethanol tariff. When that happens, the floodgates will open wide for much-cheaper Brazilian ethanol to flow freely into U.S. markets.

By leveraging the strength of its vast sugarcane growing region, and building on its already well-established ethanol producing technology, Brazil is perfectly positioned to benefit.

In fact, this emerging market tiger could easily become the Saudi Arabia of ethanol within the next decade. You heard it here first!

MIKE BURNICK, Senior Editor & Global Markets Analyst

P.S. Want to know more about the great fuel revolution – including the alternatives that may be running your car within the next 10 years? Click here to read my FREE special report to get all the details.

Source: Put This Emerging Market Tiger in Your Tank!

Of course this is NO news flash to regular readers of the A-Letter. My colleagues and I have been talking about skyrocketing agricultural commodity prices for months now. In fact, our investment director Eric Roseman dedicated a whole series of articles to the global food crisis just last week. If you missed them, you owe it to your portfolio to catch up. You can review Eric’s comments from last Wednesday, Thursday and Friday right now.

Your Food Prices Leap 83% in Three Short Years

According to data from the World Bank “Surging commodity prices have pushed global food prices up 83% in the past three years.”

Officials singled out U.S. corn-based ethanol production and other bio-fuels as a contributing factor to the rise in food prices. Corn prices have soared 56% in the past 12 months alone. About 30% of the entire U.S. crop is being diverted from kitchen tables to ethanol production.

But there’s another crisis looming too, in case the IMF hasn’t noticed…a global energy crisis! With conventional energy prices soaring, it’s no surprise that more money is being diverted into alternative energy, including bio-fuel.

Crude oil has skyrocketed over 400% since 2001 – topping US$112 a barrel last week. Coal, once considered a cheap and abundant source of energy, is now running in short supply as well. The cost of coal has soared nearly 60% this year – to US$63 per ton – and has doubled since July 2003.

So in addition to a global food crisis, the IMF should add the global energy crisis to its list of things to “officially” worry about.

One thing is crystal clear, with fossil fuel prices skyrocketing as supply continues to fall short of rising global demand, alternative energy sources are back in the spotlight and here to stay. These alternatives are more cost effective solutions to the energy crisis than ever before.

Alternative Energy is a Fast Growing Market

The market for alternative energy – including solar, wind, bio-fuels and fuel cells power – grew a whopping 40% last year alone! Alternative energy grew into a US$77 billion industry by the end of 2007, according to industry data from Clean Edge.

But that’s just the tip of the iceberg. The alternative energy sector is set to explode into a US$255 billion market within the next 10 years! The data supporting this miraculous growth is simply staggering. For instance:

• Global production of bio-fuels will grow to US$81 billion within the next 10-years, up from US$25.4 billion last year.
• Spending on solar power generation will expand from US$20.3 billion in 2007 – to US$74 billion by 2017.
• Wind power is projected to grow to US$83.4 billion over the next 10 years, up from US$30 billion in 2007.

Solar and wind power have both enjoyed phenomenal 30% compound annual growth rates over the past 10 years. That growth is set to accelerate in the future as both of these alternative energy sources go mainstream.

The commercial costs of solar and wind power are falling rapidly, making these clean energy sources more cost effective than ever before. In fact, with the soaring cost of fossil fuels, solar and wind power technologies are even cheaper than conventional energy sources in some applications.

Last year global wind power installations reached a record 20,000 megawatts (MW), of power generating capacity. That’s equivalent to the output of 20 conventional coal-fired power plants.

Advances in solar-power technology are bringing costs per megawatt down considerably. As a result, spending on solar photovoltaic systems exceeded US$20 billion in 2007. Obviously, this alternative energy technology has a very bright future.

Almost 800 cities in the U.S. alone have pledged to meet Kyoto targets for reducing greenhouse gas emissions through a greater commitment to renewable energy resources. The European Union has even more ambitious targets.

Emerging Asia is in desperate need of new power generating capacity. Rising fossil fuel costs are putting the squeeze on countries such as China and Japan, leading to more alternative energy investment sources.

Smart Money Pours into Alternative Energy

The huge growth potential offered by the expanding alternative energy sector has notgone unnoticed by well-heeled investors either.

In fact, some of the very same smart-money investors who were early to profit from the 1990’s technology boom - namely savvy venture capitalists – are now just beginning to pour billions into clean energy technology. Investment in the alternative energy sector surged 60% last year to US$148 billion in 2007.

Once again, this is just scratching the surface of the true investment potential in alternative energy today. In fact, the International Energy Agency estimates that “US$16 trillion needs to be invested by 2030 (or about US$600 billion per year) to meet the growth in projected demand for new electricity and fuel sources worldwide.”

You can bet that an increasing share of this spending will find its way into promising alternative energy technologies.

The Best Way to Invest in Alternative Energy

Alternative energy covers a lot of ground. It includes everything from ethanol to solar energy, wind to hydro-electric power. Even fuel cells and high-yield battery technologies are included in the alternative energy sector. That’s why it’s so difficult to choose specific sub-sectors to target – let alone pick the best stocks.

Perhaps one of the easiest ways to invest in the vast growth potential in alternative energy is by making a broad, sector-wide investment. There are a number of exchange traded funds that offer instant diversification among dozens of profitable companies in just one single investment.

I recently recommended one such ETF to my Global Market Investor subscribers. This ETF holds 30 leading alternative energy firms from all over the world. In fact, 65% of the stocks in this fund are listed outside the United States. This gives you the added bonus of diversifying your investment outside the falling buck and slumping U.S. stock markets.

The bottom line here is that growth in alternative energy is an undeniable long-term trend. In fact, this industry hasn’t even scratched the surface of its long-run growth potential, which means this is still a great time to buy.

MIKE BURNICK, Senior Editor & Global Markets Analyst

EDITOR’S NOTE: With ETFs, you truly have the holy grail of offshore investments right here at home. You can diversify in far off regions like Japan, Taiwan, Brazil and Singapore, and still invest right on the NYSE, with your regular stock brokerage account. This May 14 -17, Mike will introduce you to the most exciting ETFs on the planet at our Total Wealth Symposium in Panama. It’s not just ETFs. Mike will be joined by over a dozen investment experts from around the world. These experts will give you their favorite options, currencies, commodities and funds to beat the credit crunch in 2008 and beyond. Still interested in joining us this year? Seats are filling up. So please click here to reserve your seat before we sell out.

It’s the perfect storm for investors – especially when just about everything else in the investment world has continued to post big declines since last July.

Best of all, you don’t have to purchase futures and options contracts to invest in these commodity gems. I should know. I’ve been researching and recommending commodities since 2002 in my Commodity Trend Alert (CTA). So I know it’s never been easier to trade raw materials with zero leverage and no margin!

Hot Commodities for Everybody

Commodity service-providers have launched a blizzard of exchange traded funds (ETFs) over the last 12 months. These new ETFs allow both individual and institutional investors access to hot commodities like coffee, wheat, sugar and corn, to name only a few.

It’s no wonder investors have poured an extra US$30 billion into commodities within the first 60 days of the year alone compared to just US$10 billion in 1998. The boom has arrived and everyone wants a piece of the action as the dollar slides, rates plunge and emerging markets feed their bustling infrastructure and populations.

Negative Correlation to Stocks is What Makes Commodities So Tempting

Commodities, and soft agricultural commodities in particular, are not tied to stocks, bonds or currencies. They’re not correlated to any of these markets directly. Therefore commodities provide a critical asset-allocation diversification strategy to traditional portfolios.

Indeed, as global stocks plunged the first 75 days of 2008, commodities continued to hit new record highs. The soft edibles have led the charge with big gains.

Recently, commodities have started a long-awaited correction after almost seven months of blistering gains – even as global stock markets entered bear market territory. Some bears point to a “bubble” in raw materials while others exclaim the Federal Reserve will eventually start raising interest rates again to cool rising inflation, supporting the flagging U.S. dollar. I seriously doubt that.

Facts are the United States can’t afford high interest rates for the foreseeable future because the financial system is coming undone. The Fed will continue to pump massive amounts of credit in the system. Bernanke and his boys will continue to bailout institutions that they believe pose a systemic threat and they’ll do whatever they can to act as lender of last resort in the worst financial crisis since the 1930s.

This Isn’t the NASDAQ – or the Volcker Fed

“Commodities in the 2000s are what the NASDAQ was to speculators in the 1990s.”

That’s a common misperception placed about commodities today because people assume that because the gains have been so spectacular that the cliff can’t be far away. They also point to how technology stocks went wild in the late 1990s with billions of dollars chasing the NASDAQ. We all know how that frenzy ended. Eight years later, the NASDAQ still trades more than 60% below its all-time high in March 2000.

To be sure, raw materials have enjoyed spectacular gains since bottoming in late 2001. Some sectors, mainly the base metals, are overbought. You should avoid these few overbought sectors, and possibly short them using reverse-index ETFs. But the rest of the complex, despite posting big gains lately, remains well below its inflation-adjusted highs back in 1980.

Wheat is still 150% below its inflation-adjusted high, corn is 62% off and soybeans still 60% below its best level.

The main difference between technology stocks and commodities is consumption. A few billion people every day consume raw materials while tech stocks mostly suffered from a mirage of negative earnings, negative cash-flow and absurd valuations.

Thirty-five years ago, the world didn’t have China and many other emerging markets rapidly industrializing. More than two billion consumers have entered the global trade picture. Whether we like it or not, the future of capitalism lies in the east, not in the west.

If the Fed was aggressively fighting inflation, then commodities would be dangerously vulnerable. But that’s simply not the case. In fact, it’s far from reality. This isn’t circa 1980 when the Volcker Fed was busy fighting 13.6% inflation and raising rates to a crippling 21%.

Commodities feed on easy money or low rates, a declining dollar and most of all, falling production coupled by rising demand. That’s exactly what we’ve got in 2008.