But the renewed interest in ethanol proved to be short-lived, as oil retreated below $20 a barrel just four months later. As a result, many of those smaller ethanol companies couldn’t survive as profitable alternative energy investments.

Flash forward to today, where we’ve seen crude oil prices double in just the past four months. Worldwide oil demand has soared, particularly from fast-growing countries like China and India, and although the global downturn has seen the pace of demand slow, when the global economy gets back on track, it should prove even more bullish for oil.

But there’s another sector that should rise, too…

Rising Oil Prices Spark Interest In Alternative Energy

With oil prices rising again recently, it’s sparked yet another conversation about the viability of certain alternative energies.

One ETF that tracks the performance of clean energy firms is the PowerShares WilderHill Clean Energy (NYSE: PBW) – a widely traded vehicle that gives you exposure to this still-growing sector in a safer way than investing in individual companies.

While firms like Exxon Mobil (NYSE: XOM) rake in billions of dollars per quarter from oil, PBW invests almost entirely in experimental, technology-focused “green” companies. And while these guys stand to benefit from higher oil prices just like specific oil companies, their success depends more on regulatory changes, subsidies and a global recognition of the need for alternative energy solutions.

The Alternative Energy Market Gets More Attention

When it comes to the alternative energy market, wind power, solar, hydroelectric, geothermal and nuclear power have all received attention over the past couple of years.

But when the oil market first began its march towards record high prices, it was the ethanol industry that took center stage and triggered the wider debate over cleaner energy resources.

However, the ethanol market faces a battle. Despite the government’s intervention and subsidies for the industry, newer technologies are needed in order to make ethanol more viable – and the industry’s companies profitable. A good example is Pacific Ethanol (Nasdaq: PEIX) – a company that Bill Gates invested in heavily a few years ago, paying $12 a share. Today, the stock trades for just $0.40.

Below is a daily chart of PowerShares WilderHill Clean Energy (NYSE: PBW), which is currently at a critical juncture:

Chart: http://www.investmentu.com/images/iu063009chart.gif

Three Scenarios for the Clean Energy Fund

As you can see, when the stock market bottomed out in March and oil prices retested their lows, PBW’s Clean Energy Fund did the same.

Since then, however, PBW has doubled off those lows to the June 10 high of $11.37. This is right around the swing high of $11.40 that it tested back in November, before it pulled back to the trendline drawn off the March lows.

In addition, the 50-day and 200-day moving averages are very close to crossing one another – a development that sometimes indicates a short-term top.

So what we have here is a relatively clear-cut conclusion…

• A close above $11.40 would be bullish and should lead to higher prices.
• However, a close below the trendline, currently around $10, would be bearish over the short-term.
• A close or two below the 50-day and 200-day moving averages, which are currently around $9.50, could lead to a move down to $8 or lower.

Source: Alternative Energy Investments: Three Scenarios For Clean Energy

But the renewed interest in ethanol proved to be short-lived, as oil retreated back below $20 a barrel just four months later. As a result, many of those smaller ethanol companies within the alternative energy market couldn’t survive.

Flash forward to today, where we’ve seen crude oil prices double in just the past four months. Worldwide oil demand has soared, particularly from fast-growing countries like China and India, and although the global downturn has seen the pace of demand slow, the global economy gets back on track, it should prove even more bullish for oil.

But there’s another sector that should rise, too…

Viable Alternative Energies: The Clean Energy Tracker

With oil prices rising again recently, it’s sparked yet another conversation about the viability of certain alternative energies.

One ETF that tracks the performance of clean energy firms is the PowerShares WilderHill Clean Energy(NYSE: PBW) – a widely traded vehicle that gives you exposure to this still-growing sector in a safer way than investing in individual companies.

While firms like Exxon Mobil (NYSE: XOM) rake in billions of dollars per quarter from oil, PBW invests almost entirely in experimental, technology-focused “green” companies. And while these guys stand to benefit from higher oil prices just like specific oil companies, their success depends more on regulatory changes, subsidies and a global recognition of the need for alternative energy solutions.

The Government Is Helping… But This Industry Still Faces A Battle

When it comes to the alternative energy market, wind, solar, hydroelectric, geothermal, and nuclear power have all received attention over the past couple of years.

But when the oil market first began its march towards record high prices, it was the ethanol industry that took center stage and triggered the wider debate over cleaner energy resources.

However, the ethanol market faces a battle. Despite the government’s intervention and subsidies for the industry, newer technologies are needed in order to make ethanol more viable – and the industry’s companies profitable. A good example is Pacific Ethanol (NASDAQ: PEIX) – a company that Bill Gates invested heavily in a few years ago, paying $12 a share. Today, the stock trades for just 40 cents.

Below is a daily chart of PowerShares WilderHill Clean Energy (NYSE: PBW), which is currently at a critical juncture.

Three Scenarios For The Clean Energy Fund

As you can see, when the stock market bottomed out in March and oil prices retested their lows, PBW did the same.

Since then, however, PBW has doubled off those lows to the June 10 high of $11.37. This is right around the swing high of $11.40 that it tested back in November before it pulled back to the trendline drawn off the March lows.

In addition, the 50-day and 200-day moving averages are very close to crossing one another – a development that sometimes indicates a short-term top.

So what we have here is a relatively clear-cut conclusion…

• A close above $11.40 would be bullish and should lead to higher prices.

• However, a close below the trendline, currently around $10, would be bearish over the short-term.

• A close or two below the 50-day and 200-day moving averages, which are currently around $9.50, could lead to a move down to $8 or lower.

Source: The Alternative Energy Market: Bullish & Bearish Scenarios For NYSE: PBW

Nevertheless, Jim Stanton says alternative energy — and the wind-energy market in particular — has a big future. Wind energy is already the second largest source of new power generation in the US, and it now has the backing of the much-hyped Pickens Plan.

Jim says two clean-energy ETFs that look undervalued right now are PBW and GEX. He also recommends FAN for a more wind-specific ETF. 

This from the Smart Profits Report:

With the steady climb of oil prices over the past few years, it’s become apparent that higher prices are here to stay.

As a result, the market has spawned dozens of new alternative energy stocks – and subsequently, ETFs devoted to the sector.

However, with alternative energy technology developing rapidly and sub-sectors like wind, solar, geothermal, bio-fuels, and bio-mass all springing into the headlines, it can be tough to know which stocks or ETFs an investor should play.

Fortunately, ETFs give you broad exposure and diversity to certain markets, with less risk than owning individual stocks.

For example, the two most widely followed alternative energy ETFs are the PowerShares WilderHill Clean Energy ETF (AMEX: PBW), which is mostly made up of American companies, and the Market Vectors Global Alternative Energy ETF Trust (NYSE:GEX), which gives you international exposure to some of the largest companies dealing in wind power.

In 2007, these ETFs turned in outstanding performances, chalking up gains of 62% and 50% respectively. And GEX may have done even better, due to the fact that it did not begin trading until May 2007.

In 2008, however, the funds haven’t been able to sustain that performance. As of September 26, PBW is down about 40% for the year, while GEX has lost 25%.

“Springing” Back To PBW

Back in the spring (March 24, to be exact), I highlighted the performance of PBW in my “Sector Watch” piece. At the time, the stock was trading around $21 and had recently tested its January lows. With the chart pattern still bearish, I said it represented a good short-selling opportunity.

Before it rebounded last week, PBW had traded below $15. But as long as oil prices remain high, ETFs like PBW should come back into favor. Moreover, after the beating they’ve taken this year, they look like good value.

That said, I don’t like trying to pick bottoms, so let’s take a look at the daily chart of PBW for more clues…

As you can see, the downtrend line drawn from the highs last December currently sits at $18.95. As time goes by, this number will go lower, but a couple of closing prices above this downtrend line will signal a change in trend – and that the stock is probably worth buying.

Profits From Thin Air

Between PBW and GEX, though, I actually prefer GEX, due to its higher exposure to the wind power segment. This fast-growing area is gaining some serious momentum and greater investment, thanks to the publicity that T. Boone Pickens is bringing. Pickens is a very smart businessman, who is investing billions towards the largest “wind farm” in the U.S. And you can see why he’s on board…

Wind power is the second largest source of new power generation in the U.S., surpassed only by natural gas.

• In 2007, wind provided enough power to satisfy the residential electricity needs of 150 million people.
• Capacity increased by a record-breaking 20,000 megawatts, which puts the world total at 94,100 megawatts.
• According to the U.S. Department of Energy, since 1980, the cost of producing wind power has declined by as much as 90%.
• Electricity from new wind power projects will be cheaper than electricity from new conventional power plants by 2010.

If you’re a fan of wind power, there is a relatively new ETF that deals strictly with the field. It’s called First Trust ISE Global Wind Energy (NYSE: FAN) and it began trading in June 2008.

Having hit a high of $31.50 in June, FAN has sold off, along with the other alternative energy ETFs. Earlier this month, it traded as low as $20, so let’s take a look at the chart to see what the next move might be…

With only a few months of data to go on, projecting the stock’s next move is a little trickier, but we have enough information to draw a regression channel from the June highs. The upper band of the channel is currently around $24.15 and a couple of closes above that level should lead to higher prices for the stock. We’ll keep an eye on this one, as wind power continues to gain traction.

PS. Yesterday, Oxford Club’s David Fessler described how the quiet passing of an $18 billion clean energy bill could mean ‘big moves’ for FAN and two other clean energy ETFs.

Source: Forget Washington’s Hot Air… Here’s How to Really Profit from Wind

“By facilitating the growth of one of the solar industry’s leading developers, this investment gives us immediate access to attractive solar markets in Europe and the United States and will form an important part of GE’s broader strategy to become a major player in solar power,” Alex Urquhart, President and CEO of GE Energy Financial Services, said in a statement. “GE has all the right ingredients to succeed in solar: capital, technology, research and ecomagination.”

Ecomagination is GE’s in-house term for its program to help customers meet their energy needs through cleaner technologies such as solar and wind power. The company recently announced that its alternative energy investments had crossed the $4 billion threshold.

Fotowatio owns and operates solar-power installations in Spain, Italy and the United States, which will amount to approximately 960 megawatts when all projects currently under development are completed.

Countries around the world are setting aggressive renewable energy targets in hopes of reducing both environmental damage and overdependence on fossil fuels. The European Union has set a 20% target for that portion of EU energy consumption to come from renewable sources by 2020.

The International Energy Agency (IEA) projects that $45 trillion will be spent on clean technology development over the next 20 years.

And solar power is one of the fastest growing sources of alternative energy, as technological advances make solar panels thinner and more energy-efficient. To get in on the global commitment to alternative energy, here are some investments to consider.

First Solar Inc.’s (FSLR) reliance on low cost thin-film cells has helped the Phoenix-based solar module manufacturer to produce solar cells for a lower cost than its rivals. According to MarketWatch data, the average rating for this stock is “overweight” with a price target of $350. First Solar shares have traded in a range from $74.77 – $317.00 over the past 12 months and closed at $XXX.XX on Friday.

LDK Solar Company Ltd. (LDK) is a manufacturer of multicrystalline solar wafers, used to produce solar cells. This China-based firm has been hard hit this year, with a share price down over 30% year-to-date. But LDK Solar has several lucrative projects in the pipeline that could turn things around as it puts the finishing touches on a brand-new silicon plant with a 1,000-ton production capacity. Another plant with a production capacity of 15,000 tons per year is set to come online some time next year. LDK Solar shares closed at $XX.XX on Friday.

If you prefer the built-in diversification that mutual-fund-type investments offer, consider an exchange-traded fund (ETFs) that focuses on such “clean” technologies as solar and wind power. One of the top ETF names in this category is PowerShares WilderHill Clean Energy Fund (PBW). This ETF has also been battered, but if you have a long-term investment horizon and believe global governments will honor their pledge to clean energy investments, now might be the time to buy.

Source: GE Strengthens Its Commitment to Alternative Energy with a $230 Million Solar Power Investment

According to a recent survey, three-quarters of the American public think that we’re currently in a recession. The Dow is trading around the same price it was seven years ago and only seems to be heading lower.

Fuel and food prices are at all time highs and the employment picture is gradually getting worse.

And all of this on top of a housing crisis that has yet to fully take hold.

Depressed enough yet?

Basically, we’re standing on the tracks and the train is coming — I don’t need a PhD in economics to figure that much out — the only question is, do we stand here and let it hit us or do we get out of the way?

I’m voting for getting out of the way, who’s with me!?

But it’s not enough to just “get out of the way.” We’re investors; we should do whatever we can to profit from the current economic and market climate too.

On TickerHound, we’ve been seeing questions on this exact topic for the last couple of months, you can check out what some of the other members have had to say here:

What are the Top Three Investments for a Down Market?

I decided not to weigh in at the time; it was too tough to tell where things were headed. But I think the picture has become much clearer now and today I wanted to share where my trades will be focused for the second half of this year.

***********************************

“How Will I Know What and When to Buy and Sell?”

Answer: This one is simple. I’ll tell you exactly what to buy, when to buy it and when to sell it.

I’ve recommended a total of 106 plays with specific buy-and-sell recommendations. Eighty-eight went up. And the average gain over all of those plays, including losers, was an amazing 64%.

Want to know what I’m talking about? Click here…

***********************************

Discount Retailers

Given the fact that the American consumer thinks we’re in a recession, it stands to reason that consumer spending will continue to slow this year. That means luxury goods or purchases that require large lump sum payments are going to get pushed to the back burner for the time being.

So what will consumers be buying?

The usual, of course: Groceries, medicine and maybe even some clothing.

Consumers will certainly continue to buy these items, but they’ll be very picky as to where they buy them. Meaning, I doubt you’ll see long lines at Gap Stores anytime soon, or baby boomers opting to buy brand name drugs as opposed to the generics. People will be extremely cost conscious as we head into the second half of the year.

That’s why it’s important we focus on retailers that cater to the cost conscious consumer.

For me, that means looking at stocks like Wal-Mart (WMT: NYSE) and Dollar Tree (DLTR: NASDAQ), both of which have done very well over the last six months.

So I’ll be looking to go long Discount Retailers.

Alternative Energy

Forget the green movement and all the damage we’re doing to our environment with current forms of energy production, let’s just look at what’s going on at the pumps every day. The price of fuel is rising and it doesn’t look like it’s coming down anytime soon.

What’s a gallon of gas going to cost by the end of the summer: $5.00? $5.50?

The bottom line is, our dependence on crude is killing our economy and many of our industries; everything from transportation to shipping.

It doesn’t take a rocket scientist to know that we’ll need to look for alternative sources of energy in the not-too-distant future.

But it would take a rocket scientist to know which companies will pan out in this emerging sector. So while I won’t be buying any individual companies just yet, I will, however, be looking to go long on some of the ETFs that cover the alternative energy market.

I’ve had my eye on several for a while now — PBW, QLCN and GEX, just to name a few.

***********************************

Make Over 600% Profits in One Month!

Find that hard to believe? Penny Stock Fortunes Editor Greg Guenthner has the “key” to wealth…

We’ve found a proven way for you to make a fortune by risking very little by tracking Wall Street’s “Black Market.” We’ve researched, we’ve analyzed, we’ve tracked, and we want you to know the which stocks will be the winners…

To find out how to multiply your fortunes… Click here for more info…

***********************************

Automakers

This one is a no-brainer for me for the following reasons:

• Decreasing consumer spending
• Increasing cost of fuel
• Increasing cost of steel

A new car will certainly be out of the question for many American consumers for quite some time. I think food, water and medicine will be higher up on the priority list for most folks in this country.

So as this market continues to head south, so too will the Auto stocks.

Luckily for us it won’t be too hard to pick which automakers to short; they’re all performing equally poorly these days. So I’ll probably go ahead and short the Big Three for the near term. I can’t see any of them turning the corner anytime soon.

One of the most important lessons I ever learned in my years in the market is that as investors we can make money regardless of how the economy is doing. As long as we don’t get emotional, lose our cool or make decisions that go against the facts, we can come out of this downturn just fine.

So make sure you play this bear market, don’t let it play you. For more on this, read what my readers have written…

Source: Weighing in on Today’s Bear

On the second day of a three-day summit hosted by the U.N.’s Food and Agriculture Organization in Rome, leaders from 40 nations and representatives from 183 countries met to address the growing world food shortage.

“We must focus on the underlying causes: years of neglect of the agricultural sector and the lack of investment in increasing productivity,” U.N. President Ban Ki-Moon told reporters, Bloomberg News reported. “The price of oil has contributed significantly in the price rise of food. There is no doubt about that it affected the cost of transportation.”

The summit has been contentious, as leading biofuel producers such as the United States and Brazil have tried to deflect criticism that ethanol derived from corn and sugar is also driving up food prices, The Wall Street Journal reported.

“We don’t have clear evidence on the trade-off between agriculture products and biofuels,” Ban said, but there is an “urgent need to establish an international consensus and agreed policy guidelines.”

Meanwhile, less-developed countries that have set limits on exports such as rice, in order to feed their own populations, were fighting off calls for more free trade.

“We shall renew our efforts to further improve the environment and establish a fair and equitable order for international agricultural trade and protect the initiatives of farmers for production in developing countries,” Sun Zhengcai, China’s agricultural minister told state-run news agency Xinhua.

Ban laid the blame squarely on the rising cost of grains, which have increased dramatically over the past two years. The U.N. estimates that if countries do not act to stem growing global hunger, more than 800 million people could soon not have enough to eat.

The Global Ag Boom

When asked about the causes for the massive run-up in food prices, “experts” listed many of the same catalysts that have been discussed at the U.N. summit:

• Rising fuel costs.
• The use of certain foods – such as corn – for the creation of biofuels that are being developed to combat global warming.
• Rising populations.
• Growing demand from emerging economies – particularly China and India.
• Floods and droughts that are being blamed on ongoing climate changes.

But two causes aren’t on that list and they should be. The first is subprime mortgage crisis, which caused the U.S. Federal Reserve to go on one of the most aggressive rate-slashing campaigns in its history. The second is a greenback that’s been made weaker with each cut of the Federal Funds rate. Both are part and parcel of inflation.

Unfortunately for all the starving folks abroad, these rate reductions are highly inflationary. They continue to force the greenback ever lower, while at the same time boosting the price of dollar-denominated commodities such as oil.

The answer is a growing global interest in agriculture, both planting more crops and devising heartier, disease-resistant crops through the use of biotechnology.

Long-term, that global “Ag Boom” is the answer to the current food crisis. It’s also how you can offset the rising costs on the consumer side of your personal ledger by ramping up profits from this very same trend on the investment side of your own ledger.

To invest in the commodities boom, look at these two exchange-traded funds (ETFs):

• Van Eck recently launched its Market Vectors Agribusiness ETF (MOO), a fund that really reflects the breadth of the agriculture sector, apportioning its holdings across such sectors as chemicals (34%), agri-product operations (33%), equipment (24%), livestock operations (6%), and ethanol/bio-diesel (2%).

• The Deutsche Bank AG (DB) managed Power Shares Agricultural Fund (DBA) is intended to reflect the performance of commodities in the agricultural sector – soybeans (31%), wheat (28%), corn (23%), and sugar (16%).

Or if you believe that biofuels – and other forms of alternative energy sources – will be an inevitable part of the global future, consider the following “green” ETF: The PowerShares WilderHill Clean Energy (PBW), one of the better-quality funds that focus on “clean” technology as determined by the WilderHill Clean Energy Index.

Source: U.N. Calls for Increased Cooperation to Fight Growing Global Food Crisis

Yesterday (Thursday) futures prices for that benchmark grade of crude oil hit the latest in a succession of record highs, punching through the $135-a-barrel mark on the New York Mercantile Exchange, before sliding back.

In other words, in only a single year, crude-oil prices have more than doubled, soaring 115% – and setting 27 separate new records along the way. And while a short-term correction may be in the offing – especially with fears of a U.S. recession ebbing – the reality is that oil prices are nowhere near the end of their run, meaning the United States is really an economic system that’s at the crossroads.

“The market is less worried about the economy and subprime problems,” Tim Speiss, head of the wealth-management arm of Eisner LLP, told MarketWatch.com. “But that’s near-sighted. If oil stays above $130 a barrel, that’s a very significant event and a lot of the sectors of the economy would have to be re-engineered.”

Commodities of all types are at or near all-time record highs. And the impact – on a global basis – has been as starting as it is far-reaching, affecting consumers at all income levels and in every market across the world.

Even so, here in the U.S. market, it’s the price of oil – and of gasoline – that continues to dominate the headlines. Like a junk-food junkie who’s constantly searching for a sugar fix, the U.S. economy is addicted to foreign oil. And because it’s not a habit we’re going to kick anytime soon, U.S. consumers will be forced to live with the heinous consequences.

Given that harsh reality, shrewd investors will look for ways to offset that largely unavoidable pain with some well-placed profit plays. Before we can do that, however, a look at the basics is necessary.

Oil Prices 101

Since 2005, global oil production has remained stagnant, but demand has increased exponentially. Even if American consumers are unwilling to pay $4 a gallon for gasoline, and U.S. demand plummets, global demand will continue to rise.

Eduardo Lopez, an analyst with the International Energy Agency, told The Independent that America’s role as the global oil-price arbiter – the United States consumes one out of every four barrels of oil used worldwide – is dwindling.

“Demand is coming from emerging markets. As long as the [United States] doesn’t collapse, it doesn’t really matter if the mature economies are slowing,” Lopez said.

While the IEA expects demand in industrialized countries to decline by 0.7% (about 300,000 barrels of oil per day) this year, the Paris-based group says oil consumption in the rest of the world will grow by 3.7% (1.4 million barrels a day).

The net increase is due chiefly to the rapid growth in China and India.

Fueling the Fast-Growing Economies of China and India

According to the China Petroleum and Chemical Industry Association (CPCIA), China’s apparent consumption of petroleum byproducts such as gasoline, diesel and kerosene rose 16.5% year-over-year in the first-quarter. Crude oil consumption jumped 8%.

China’s net imports totaled 44.95 million metric tons in the first quarter, up 15%, and net imports of oil products rose by 32% from a year ago, according to the Asian nation’s General Administration of Customs.

And now that the most powerful earthquake in 58 years has ravaged the country’s infrastructure – smashing roads, leveling refineries, and shutting down hydroelectric plants – China has been forced to supercharge its imports of diesel and jet fuel just to supply power generators and airports to help it accelerate the desperate rebuilding process.

Ultimately, the IEA sees China’s oil demand more than doubling to 16.5 million barrels a day by 2030.

But that’s nothing compared to other emerging hot spots, where demand is expected to rocket sevenfold during that same stretch.

Just look at India, another big country with a pedal-to-the-metal growth rate. That country is expected to overtake the United States, Japan, and China as the world’s leading net importer of oil by 2025.

In 1970-71, India was importing 11.66 metric tons of crude oil. By 2005-06, however, the imports had increased to 99.40 metric tons, the Economic Times reported. Since 1997-98, alone, petroleum imports have almost tripled. Nearly 76% of India’s domestic oil needs are met via imports.

And it’s really no wonder: India’s demand for oil is expected to grow by 8%-10% this year alone.

Together, China and India will account for 45% of the increase in global primary energy demand through 2030. The two countries’ net oil imports are expected to jump from 5.4 million barrels in 2006 to 20 million barrels a day in 2030, which could create a “supply crunch” as early as 2015 according to the IEA.

The Pending ‘Supply Crunch’

There’s no avoiding the fact that the world will one day run out of oil. In fact, the biggest field in the world, Saudi Arabia’s Ghawar field, is only a shadow of its former self. It was originally discovered in 1948. And since the 1970s, the oil field has required large-scale injections of seawater – a technique used to artificially pressurize an oil reserve that’s on the decline.

Ghawar isn’t the only spot where this seawater saga is playing out. As the biggest, most-accessible, and most-cost-efficient wells on the planet dry up, oil producers are struggling to replace them.

To do so, they’ve been forced to experiment with challenging and costly deep-sea drilling expeditions. Such heavy-hitters as Exxon Mobil Corp. (XOM), BP PLC (BP), Total SA (TOT), Chevron Corp. (CVX), ConocoPhilips (COP), and Royal Dutch Shell PLC (RDS.A, RDS.B), will spend a record $98.7 billion this year on exploration and production, according to Lehman Bros. Holdings Inc. (LEH).

Exploration costs have more than quadrupled since 2000, as oil producers have been forced to take on more complex projects and the costs of both labor and materials have skyrocketed. In just the past eight years alone, the cost of finding and developing a barrel of crude oil soared from $4 to $18, Andrew Latham, vice president of exploration services at consulting firm Wood Mackenzie Ltd., told Bloomberg News.

With more than $1.5 billion in assets, PBW is one of most popular, diversified ways to invest in solar, biomass, wind, and geothermal energy. Common sense tells us when the holy trinity of fossil fuels – crude oil, coal, and natural gas – rise in price, companies that provide cleaner substitutes should also rise in price.

Today’s chart tracks the ratio between the price of crude oil and the price of the Clean Energy ETF. When the ratio hits around 3 or below, clean energy stocks are popular and soaring. When the ratio moves past 5, clean energy shares are out of favor and lagging the gains made in crude oil.

PBW’s only been around for three years, and this indicator is pretty rough… But with oil approaching $130 a barrel and clean energy stocks out of favor, expect a rally from the “treehugger-approved” companies of the world.

Source: Clean Energy Stocks Are Due for a Big Rally

Pickens’ Mesa Power LLP yesterday (Thursday) unveiled the first phase of an eventual $10 billion alternative energy project that has the potential to become the world’s largest wind farm.

“You find an oilfield, it peaks and starts declining, and you’ve got to find another one to replace it,” Pickens, who once operated one of the largest independent oil-and-gas production companies in the country, said of the deal. “It can drive you crazy. With wind, there’s no decline curve.”

Mesa Power will purchase 667 wind turbines from General Electric Co. (GE). Each turbine can produce 1.5 megawatts of electricity. The first phase of the project will produce 1,000 megawatts, enough energy to power 300,000 homes. GE will begin delivering the turbines in 2010, and current plans call for the project to start producing power in 2011.

“T. Boone Pickens’ commitment underscores the ability of wind technology to help meet the country’s need for diverse sources of energy,” said Jeffrey R. Immelt, GE’s chairman and CEO. “As America’s demand for energy escalates, it is clear that wind can and will play a bigger part in meeting that need. We’re excited to partner with an energy visionary like T. Boone Pickens to bring our wind technology to the marketplace.”

Ultimately, Mesa Power plans to have enough turbines to produce 4,000 megawatts of energy, the overall project is expected to cost $10 billion and be completed in 2014.

Mesa Power has leased sparsely populated land in the Texas panhandle, where the wind often blows during daylight hours when energy needs are highest. Texas’ Competitive Renewable Energy Zones (CREZ) transmission lines will deliver what Pickens hopes will be “cost effective and reliable electricity generated by renewable energy power projects.”

“We have had a great response to this project,” Pickens said. “We are making Pampa the wind capital of the world. It’s clear that landowners and local officials understand the economic benefits that this renewable energy can bring not only to landowners who are involved with the project, but also in revitalizing an area that has struggled in recent years.”

“Alternative” Energy No Longer Just an Alternative

At a time when oil is costing upwards of $125 a barrel, alternative energy sources are no longer just for the environmentally conscious, but for the cost conscious, as well.

“The development of alternative energy projects, especially renewable resources such as wind power, is critical for the future of the country in the face of declining world oil resources,” Pickens said.

For years, emerging economies such as China have chosen “cheap” over “clean” when it comes to energy sources. But with the cost of traditional fuel sources such as oil and coal skyrocketing, environmentally friendly choices are becoming more appealing.

When it comes to China investments, “the smart money is in the clean money,” says Money Morning Investment Director Keith Fitz-Gerald.

And when it comes to alternative energy, wind power isn’t the only option. The Solar Energy Industries Association (SEIA) says that solar power will provide 50% of all new electricity in the United States within eight years, creating tens of thousands of new high-tech jobs, while helping to conserve natural gas and saving American taxpayers billions in energy costs.

And while that estimate might be a bit ambitious, it’s certainly true that solar power use is on the rise, both domestically and abroad.

One of the solar power stars is First Solar Inc. (FSLR), which designs and manufactures solar modules using a proprietary thin-film semiconductor technology. With that know-how, the company’s average cost for making a solar module is among the lowest in the world.

Another up-and-comer is LDK Solar Company Ltd. (LDK), which expects to complete a brand-new silicon plant with a 1,000-ton production capacity this summer. And another plant with a production capacity of 15,000 tons per year is set to come online sometime next year.

If you prefer the built-in diversification that mutual-fund-type investments offer, consider an exchange-traded fund (ETFs) that focuses on such “clean” technologies as solar and wind power. One of the top ETF names is PowerShares WilderHill Clean Energy (PBW).

If you’re the type of investor who prefers cool breezes to sunny skies, you could invest in the makers of wind turbines.

Two of the largest include GE and Siemens AG (ADR: SI). GE just received the $2 billion order from Pickens and expects another $6 billion in orders from the planned 4,000 MW Pampa project alone. And Siemens will supply the turbines for a 500 MW wind farm planned in the United Kingdom.

Source: Former Oilman T. Boone Pickens Makes a $2 Billion Bet on Alternative Wind Energy

Don’t you believe it.

I’ll grant you, the alliterative moniker for the crisis cooked up by WFP Executive Director Josette Sheeran was clever – if not downright brilliant: It was picked up by dozens of global news services and was actually featured prominently in quite a few headlines. It’s also one of the most accurate descriptions of a growing global crisis that I’ve ever seen.

You see, the “silent tsunami” is real. And as the damage escalates, the silence will devolve into a grating global cacophony of pain, poverty and protests. The folks at the U.N., the World Bank, and in global capital cities from Beijing to Washington all have vowed to fight back. In Great Britain, the government this week hosted a world summit at its offices on Downing Street.
But there’s a problem. And it’s a pretty big one: You see, even the folks who are planning to battle back against the “silent tsunami” aren’t fully armed in that they don’t really understand all its causes.

Nor do the victims understand the very real steps that they can take to protect themselves – let alone how to offset at least some of the damage by profiting on the very real global trends that have whipped up this worldwide food firestorm.

Let me explain …

Fanning the Flames of a Global Food Crisis

By “silent tsunami,” Sheeran is referring to soaring worldwide food prices – the first truly global food crisis since World War II. The WFP says the crisis already threatens 20 million children in the world’s most-poverty-stricken regions, and has ignited demonstrations and protests in Africa, across Asia, and throughout the Caribbean. This unrest even led to deaths in Haiti and in Cameroon, where civil servant Samuel Ebwelle told a journalist from The Associated Press that the thought of continued escalations in the price of food scares him deeply.

“We are getting to the worst period of our life,” said Ebwelle, 51. “We’ve had to reduce the number of meals we take a day from three to two. Breakfast no longer exists on our menu.”
World Bank President Robert B. Zoellick claims that as many as 100 million people could be forced deeper into poverty. And U.N. Secretary-General Ban Ki-moon says the soaring price of food is undermining a goal of slashing worldwide poverty in half by 2015.

So just how bad is this “tsunami?”

According to the World Bank, worldwide food prices have risen a scorching 83% over the past three years. The price of rice – a staple of daily diets all across Asia – has actually doubled in the last five weeks. [Here in the United States, the Sam’s Club warehouse stores unit of Wal-Mart Stories Inc. (WMT) actually began limiting rice purchases yesterday (Wednesday)].
Research such as the World Bank stats certainly give the crisis a somewhat daunting feel, but it’s when an American consumer takes a look at actual grocery store prices that the impact finally starts to hit home. Consider these prices from a U.S. Bureau of Labor Statistics study:

• A dozen large Grade A eggs that two years ago cost $1.33 now costs a U.S. shopper $2.17 – 63% more.
• A pound of whole wheat bread has jumped 42% during that same period, moving from $1.32 to $1.88.
• A gallon of whole milk has jumped 20%, moving from $3.22 to nearly $3.90.
• And a pound of white flour, a key ingredient in so many things, has soared 39%, from 33 cents to 46 cents.

Add in the impact of rising fuel and energy prices – regular gasoline that consumers use to drive to their jobs or run family errands is up 18% in the past year, while the diesel fuel that powers the trucks and trains that deliver goods from producers to market has soared 44%.

The bottom line is this: In the U.S. market, inflationary forces have struck hard at staple goods – the essentials like groceries, gasoline and healthcare – causing them to soar, while having very little impact on luxury goods that many American consumers are avoiding right now anyway.

Because food and energy costs are backed out of – not included in – the so-called “core” rate of inflation, domestic pricing pressures still look fairly benign, with inflation running at a tad bit more than 4%.

But clearly the “real” inflation rate is much higher. And U.S. consumers and investors know it, because they’re worried – if not afraid.

According to a USA Today/Gallup Poll released yesterday (Wednesday), 73% of the American consumers surveyed cited soaring food costs in the form of rising grocery bills as a concern, while nearly half said that food inflation has caused a “hardship” for their households.

That’s here in the United States. Let’s now take a look overseas, where the rising prices aren’t merely a “hardship” – they’re a disaster.

Causes, Effects, Solutions

The U.N.’s World Food Programme says the soaring food prices will leave a $755 million shortfall in its $2.9 billion budget, forcing cuts in vital programs.
“This is the new face of hunger – the millions of people who were not in the urgent hunger category six months ago, but now are,” Sheeran said. “The response calls for large-scale, high-level action by the global community, focused on emergency and longer-term solutions.”

But here’s the crux of that problem: Before you can fix a problem, you have to understand its root causes. And it’s clear to us that very few folks really see the big picture.
When asked about the causes for the massive run-up in food prices, “experts” listed many of the same catalysts:

• Rising fuel costs.
• The use of certain foods – such as corn – for the creation of biofuels that are being developed to combat global warming and to take up the slack for the increase in conventional fuel prices.
• Rising populations.
• Growing demand from emerging economies – especially China and India.
• Floods and droughts that are being blamed on ongoing climate changes.

Unfortunately, they forgot two causes – and they’re not small: The first is the implosion of the U.S. subprime mortgage bubble, and the second is a greenback that’s so weak that it’s threatening to disappear altogether. Both are part and parcel of inflation.

By creating all the cheap money that created, first, the U.S. Internet stocks bubble and, second, the U.S. housing bubble, the U.S. Federal Reserve essentially created the subprime mortgage bubble. When that burst, as all bubbles must, it created a global financial crisis that forced all the world’s key central banks to create additional liquidity in an attempt to basically bail out the world’s developed economies [and lest we try and blame the United States for all of this, let’s not forget that Great Britain has a humdinger of a housing bubble that’s deflating, but hasn’t quite fully collapsed].