This leaves less than 1% of the world’s water supply for its 6.87 billion human inhabitants, crops, and livestock.

Even worse, our tiny portion of the world’s water is becoming increasingly polluted and is consumed at unsustainable rates.

Fortunately, Paris based Veolia Environnement (NYSE: VE) has everything it takes to help us avoid the looming global water shortage and pad our portfolio.

With operations in 66 countries, Veolia provides water and wastewater management, transportation, and energy services to countries in desperate need of fresh water.

In fact, Veolia operates in all five countries considered to have the most potential for growth in the water and wastewater industry. And with roughly 20% of the world’s population, China is at the top of this list.

Currently water pollution plagues 90% of Chinese cities.

Luckily for the Chinese – and Veolia stakeholders – Veolia Water operates in 20 of 34 Chinese provinces and has contracts naming the company as the sole water supplier for 30 million Chinese citizens.

And the best part? These contracts aren’t just for 2009; some span up to 50 years!

Due to dire need for potable water and increasing infrastructure, Veolia can expect growth in China of up to 25% per year.

The Infrastructure Behind Water

Worldwide spending on the improvement and expansion of water infrastructure is forecasted to grow nearly 98% by 2016. And with the United States making up less than 4% of the total demand for infrastructure upgrades, water investors must think internationally.

Strengthened by its global reach and vertical integration, Veolia is the perfect opportunity.

The company is so large that its economies of scale allow it to create greater profits that its competitors and provide investors with a higher return.

Even in this year’s struggling economy, Veolia distributed its most impressive dividend in company history– at 5.74% of its share price.

Because of the difficulty small water companies face and growing costs associated with finding and treating freshwater, experts expect to see increasing consolidation in the industry.

Veolia’s positioning ensures that the company will remain a market leader throughout the market overhaul.

By aligning itself with equipment manufacturers, the company has built its own desalinization plants, giving Veolia control of its processes from the collection of wastewater to the servicing of end users.

Now, government stimulus packages all over the world are supplying billions for infrastructure upgrades ($90 billion in the US alone).

With gains of over 50% in the last six months, Veolia shareholders have had their appetites whetted … and are thirsty for more.

Source: Veolia Environnement SA (NYSE: VE): Stock of the Day

This from Martin:

I’m drinking on the job again.

No, not that kind of drinking. I’m swigging away from a one liter bottle of fresh water. Like most folks, I thought nothing of it when I bought it. I took its availability for granted, even though it’s that cool Voss stuff all the way from Norway.

But sadly, that’s not the case for approximately 40% of the world’s population, which lacks adequate fresh water supplies. What’s more, the United Nations says that two out of three people will be living in areas under “water-stressed” conditions by 2025.

Water shortages currently affect 80 countries and within 50 years, more than half the global population will be living with water shortages.

But hang on a minute… isn’t 71% of the Earth’s surface made up of water?

Yes, that’s true. But 97.5% of it is seawater, leaving just 2.5% that is drinkable. And only about 0.1% of all water is readily available. Most of it is locked up in glaciers, groundwater, and soil.

And water supply problems are only going to get worse… which opens up some very good investment opportunities.

Here’s the deal…

More People = More Pollution = Less Water

In 1900, there were about 1.6 billion people on Earth. Today, there are 6.5 billion. By 2025, the world population is expected to rise to 9 billion.

But here’s the problem: During the 20th century, human water consumption swelled six-fold and global water demand already exceeds supplies by 17%, according to the Population Institute.
And World Bank figures show that demand is doubling every 21 years. By 2020, the two billion extra people will require 20% more water than is currently available, according to the International Food Policy Research Institute.

And speaking of food, global population growth leads to increased industrialization and pollution. U.S. energy production requires about 40% of fresh water withdrawals. And the fact that people are also living longer means not only less drinking water, but also less water available for food production.

Crop production already claims 65% of fresh water, compared to 25% for industry and 10% for households. There is 7,000 liters (1,900 gallons) of water used for one kilogram of grain-fed beef… 5,000 liters (1,300 gallons) for one kilo of rice… and 1,500 liters (400 gallons) for one kilo of corn, according to the U.S. Geological Survey.

The point is… when it comes to water needs, it doesn’t matter one iota what the economy or stock market is doing. Every single person on the planet needs water… period. And with H2O in shorter supply, the world is set to invest approximately $800 billion over the next decade in order to improve the situation. This is the time for smart investors to run with this opportunity…

The China Problem

For all the talk of federal budget plans, economic bailouts, stimulus packages and all the other dizzying (and often demoralizing numbers), money is no object when it comes to satisfying the world’s water needs.

Put bluntly, no water = no people. Certainly no need to worry about the economy, unemployment, the real estate and auto industry debacles, or anything else if you’re not actually alive!

Of that $800 billion number I just mentioned, China has set aside $200 billion for its water infrastructure over the next decade. It makes the U.S. government’s $8.4 billion look like small potatoes in comparison – and woefully inadequate. The Environmental Protection Agency forecasts that the U.S. will have to spend $277 billion on water infrastructure by 2019. Nevertheless, China has some serious problems…

Two-thirds of the country already faces water shortages. Its annual water shortage is 40 billion cubic meters and it uses 30 more cubic kilometers of water than is replaced by rain.

Of its 1.3 billion people, 300 million don’t have access to clean drinking water.

According to Summit Global Management, “75% of China’s drinking water is unsuitable for drinking and cooking, and 80% of China’s seven major river systems no longer support fish.”

What’s worse is that at the current growth rate, China’s population is doubling every 12 years. More people = more food/drink needs = more agriculture development and industrialization = more pressure on water supply and demand.

So what’s the solution?

Thirsty For Profits? Try These Water Stocks…

Let’s kick off with a broad investment option. Because of their increased flexibility, lower costs, and the fact that they trade like stocks, I like ETFs (exchange-traded funds). With water, you can go for…

~ PowerShares Water Resources (NYSE: PHO), which tracks the price and yield performance of the Palisades Water Index. The fund includes big water companies like Veolia Environnement (NYSE: VE) and Ameron International Corp. (NYSE: AMN)

~ Claymore S&P Global Water Index Fund (NYSE: CGW), whose results aim to replicate the performance of the S&P Global Water Index. Like PHO, it holds Veolia and Aqua America Inc. (NYSE: WTR), plus Danaher Corp. (NYSE: DHR) and Severn Trent in England.

Breaking it down, Paris-based Veolia is one of the biggest water infrastructure stocks and is split into four groups: Water, Environmental Services, Energy Services, and Transportation. Click this link for a more detailed company profile and rundown of its water management operations – it has a very broad reach in the industry. With a P/E ratio of just 9, it’s trading at a hefty discount and coughs up a fat 15.8% dividend yield ($3.12 per share annually), too.

Aqua America’s fourth quarter revenues rose 7%, resulting in 3% earnings growth. With an aggressive acquisition policy that has seen the firm tie up more than 100 buyout deals over the past few years, it has boosted its customer base from 245,000 in 1992 to 950,000 today. It applied for $80 million worth of price increases last year, with $61 million approved. This resulted in a 10% revenue increase in 2008 and a 15.7% profit margin. It pays a 2.8% dividend.

There’s another option, too…

Salty Solutions

The National Academy of Sciences recently stated, “Desalination is a realistic option for increasing water supplies.”

In fact, global spending on desalination is set to more than double in four years in an attempt to boost the 11 billion gallons of drinking water that the process currently creates every day. That’s because even that hefty-sounding number still only represents 1% of water usage.

But desalination capacity is about to surge by 45% over the next seven years, producing an extra five billion gallons of water per day. And with 1,200 desalination plants worldwide, the cities of Las Vegas and San Diego (based in two states suffering some of the most severe water shortages in the U.S.) are discussing plans to build new plants themselves.

Yes, desalination is an expensive, energy-intensive process. But there’s one company that is attempting to solve it by not only producing clean water, but also recovering and recycling as much energy and waste as possible. It just signed a deal with China’s largest plant, too.

My colleague Marc Lichtenfeld, who’s as bullish as I am on the water industry and water stocks, added this small-cap, fast-growing company to the Xcelerated Profits Report portfolio last month. And just this week, he added another water-based company, whose shares are up around 230% over the past 18 months. Sales are continuing to rise – and demand for its products is red hot. It’s also active in China.

Boy, after all that, I’m really thirsty now. So while I find some more water, here’s what I’d like you to do. While I can’t reveal the names of those two water stocks that Marc recently added to our portfolio, what you can do is check out how you can become a member yourself. Go here for full details on the Xcelerated Profits Report. And if you like what you see, click this link to start profiting right away.

Water is critical. We can’t live without it. But with population growth, pollution, industrial expansion, and climate change resulting in shorter supplies as demand continues to rise, it’s no wonder governments around the world are pumping billions into the industry for infrastructure improvements. And water stocks could be one few areas that could truly benefit in this wretched global economy.

Source: Water Is The World’s Most Critical Commodity… Here’s How You Can Profit From It

This from David:

A few weeks ago, during a particularly bad cold snap, we had a pipe freeze underneath our 200-year-old farmhouse, causing us to go without water for a few days. I eventually managed to unfreeze the pipe, but there was no question it was disruptive for a busy household of four.

Here in the United States, we don’t realize how much we take our fresh water supply for granted, until it’s suddenly cut off. We’re used to turning on the faucet and there it is.

But for the folks in California, 2009 is shaping up to be a big fresh water disaster in the making. Last Thursday, state water officials reported that the snow pack in the Sierra Nevada Mountains is only 61% of what is considered normal for this time of year.

An with only eight weeks left in the rainy season, significant rain and snow is needed for the next two months in order to divert a disaster.

That’s on top of back-to-back dry years in 2007 and 2008. The situation is so bleak, officials may be forced to ration water on a statewide basis for the first time since the 1990s.

Lester Snow, the Director of California’s Department of Water Resources, put the situation in perspective: “We may be at the start of the worst California drought in modern history. It’s imperative for Californians to conserve water immediately – at home and in their businesses.”

The fallout has already hurt the wild salmon population, and if the drought continues, it will get even worse. Farmers, who use 80% of California’s water for irrigation, will have to cutback on the number of acres they plant. That will have a devastating impact, as agriculture is one of the most important sectors of California’s economy.

Fresh Water: The New Oil

Fresh water has been talked about as the “new oil,” but it’s far more important. The human race can survive without crude oil, but not without water. We can’t live more than a week without it.

And for that reason – unlike oil – it is completely immune to demand destruction. We need a pint a day, on average, to maintain a healthy existence. If you include the amount used to produce our food, the number jumps to nearly 1,000 gallons per day per person, and even more in countries whose citizens eat a lot of meat.

The main problem with oil is finding more of it. With water, it’s the distribution system that’s the issue, as it primarily flows through pipes. Many were installed when Edison was fooling around with electricity.

While California has its own set of special problems when it comes to water and its distribution, the problem is monumental nationwide:

• 650,000 miles of antique water pipes are in need of repair or replacement.
• Nearly 30% of the water infrastructure in New York City – and most other big metropolitan areas in the east – dates back to when Lincoln was president.
• Many of the nation’s water purification facilities are more than 50 years old, and completely outdated.

But don’t think the United States is alone in this dilemma. China has lots of water, but much of it is polluted or untreated. Roughly 300 million of its 1.3 billion people don’t have access to clean drinking water out of the tap.

China is spending tens of billions of dollars annually to try to fix the problem.

2 Ways to Play the Coming Water Boom

While the recession has consumers hunkering down – and cutting back their purchases of computers, cell phones, toys and other discretionary items – it hasn’t decreased their demand for clean, fresh water.

And one of the biggest companies in the world that’s able to provide the infrastructure to deliver it is Veolia Environment (NYSE: VE). It provides bumper-to-bumper environmental management services for both water and wastewater.

Whether it’s supplying clean water, recycling wastewater, or developing waste conservation systems, Veolia has a solution.

In China, it’s operating freshwater plants, wastewater decontamination and recycling plants and sewerage treatment facilities.

And now you can add some shares to your portfolio at more than a 75% discount to what they were trading a year ago. Veolia currently trades with a P/E of 8.8 and sports an 8.1% dividend yield.

A different, but no less lucrative, way to invest in water stocks is the Calgon Carbon Corporation (NYSE: CCC). Calgon is a manufacturer of activated carbon granules, a material that’s essential in many of the world’s water purification systems and over 700 other liquid purification and odor control applications.

Carbon granules remove impurities from water, air and many industrial processes.

And business is booming for Calgon:

• The company’s shares are up over 200% since September 2006, and worldwide demand is continually increasing for its products.
• Sales in 2008 were $351 million, with roughly 62% of that coming from the Americas, and only 7% coming from Asia.

Clearly the opportunities for the company are enormous. This past year, the company signed a contract with the Jiaxing Jiayuan Water Company to provide 1.1 million pounds of carbon granules for water purification.

James Fishburn, Calgon Senior Vice President, commented on the significance of the order: “Over the last 40 years, Calgon Carbon has supplied millions of pounds of activated carbon to municipalities all over the world, and we are committed to serving the rapidly growing markets in China.”

In summary, both companies mentioned above are addressing a market that will be rapidly expanding for the foreseeable future. Fresh water is clearly the new oil. And now’s a great time to make it part of your infrastructure and energy portfolio.

Source: Fresh Water: California Drought Reveals the “New Oil”

This from Investment U:

A friend of mine, along with his family, owns and operates one of the largest landfills in my area. He smiles and says, “It’s about as a recession-proof business as you can find. Here in the United States, people and businesses generate 750,000 tons of garbage every day. The trucks never stop coming.”

Many years ago, before recycling became popular, the company started a recycling operation as a natural extension of the landfill business. It’s doing very well. When any given recyclable commodity goes up, the company’s a seller. The rest of the time, it just stores the copper, steel, aluminum and a dozen other scrap metals and plastics in huge mounds.

Now the company plans to “drill the pile” and tap into the vast source of methane gas generated when garbage decomposes. That solves a big problem with landfills: smell. Some of the power produced will be used at the site and the excess will be sold off to the local power company.

Plans to expand the landfill are currently under way. And even though the company gives back to the community in many ways besides paying taxes, the expansion is being met with mixed feelings by local residents. It’s the old “NIMBY” (not in MY backyard) argument. So what’s the best way to play the garbage game?

Market Vectors Environmental Services: A “Trashy” ETF

Not surprisingly, there is a “trash” exchange traded fund (ETF), called Market Vectors Environmental Services ETF (AMEX: EVX) that seeks to replicate the performance of the AMEX Environmental Services Index.

The 24 companies in the AMEX ESI include those involved in the management, removal and storage of consumer and industrial waste (trash haulers and landfill operators), and related environmental service companies.

Three of the top four holdings of EVX are trash haulers and landfill operators: Waste Management, Inc. (NYSE: WMI), Republic Services, Inc. (NYSE: RSG) and Allied Waste Industries (NYSE: AW). Veolia Environnement (NYSE: VE), an international environmental services company, rounds out the top four.

EVX shares – cut in half by the recent market rout – have recently rebounded to the $35 range, but still trade well below the 52-week high of $58.54 reached this past June. EVX sports a yield of 1.5% and is a great buy at current levels.

Special Mention - Clean Harbors Included in Amex: EVX

Clean Harbors (Nasdaq: CLHB) – a vertically integrated environmental services and hazardous waste treatment company – is included in the EVX ETF, but merits special mention.

Handling the hazardous side of waste disposal and management is Clean Harbors’ special focus, and business is booming. Revenues are up 55% in the last three years, and earnings are up an even more impressive 81%.

Clean Harbors is the leading provider of environmental services in North America, with 45,000 customers located in the United States, Mexico, Puerto Rico and Canada. The company’s customer list includes 325 of the Fortune 500 companies, and it services them from over 100 locations.

Treating and disposing all this hazardous waste requires extremely specialized facilities, and Clean Harbors has that covered, too. The company owns and operates six hazardous waste incineration facilities, six wastewater treatment plants, nine landfills, six PCB (polychlorinated biphenols) management facilities, two waste oil reprocessing and recycling facilities, and 20 TSDFs (transportation, storage and disposal facilities).

The second quarter of 2008, ending in June, was a record for the company. CEO Alan S. McKim had said, “Clean Harbors delivered another record quarter in Q2, with double-digit increases in both revenue and profitability. Solid growth across nearly all of our operations enabled us to generate revenues of $265.3 million.”

Currently, shares are trading midway between their 52-week high/low, and represent an excellent buy at current levels.

I expect that the third quarter of 2008 will be another good one for the company, perhaps another record. We won’t have to wait long. It’s expected that earnings will be announced on November 3, 2008.

In summary, both Market Vectors Environmental Services ETF (AMEX: EVX) and Clean Harbors represent two great ways to add some recession resistance to your investment portfolio while you wait for the global economy to slowly recover.

Source: Market Vectors Environmental Services ETF: Adding Recession “Insurance” To Any Portfolio

NEW HIGHS OF NOTE LAST WEEK

Halliburton (HAL)… oil services
Patterson-UTI (PTEN)… oil services
Carbo Ceramics (CRR)… oil services
Atwood Oceanics (ATW)… oil services
Key Energy Services (KEG)… oil services
National Oilwell Varco (NOV)… oil services
Spectra Energy (SE)… gas pipelines
U.S. Steel (X)… you guessed it
Schnitzer Steel (SCHN)… scrap steel
Fluor (FLR)… infrastructure
Quanta Services (PWR)… infrastructure
Crude oil, Natural gas, Gasoline, Corn, Soybeans, Cocoa

NEW LOWS OF NOTE LAST WEEK

JetBlue (JBLU)… airline
US Airways (LCC)… airline
Continental Airline (CAL)… airline
MGM Mirage (MGM)… casinos
Boyd Gaming (BYD)… casinos
Wynn Resorts (WYNN)… casinos
Las Vegas Sands (LVS)… casinos
Monarch Casinos (MCRI)… casinos
Winnebago (WGO)… RVs
Thor Industries (THO)… RVs
Fleetwood Enterprises (FLE)… RVs
Goodyear Tire (GT)… tires
News Corp (NWS)… media
Hershey (HSY)… candy
Playboy (PLA)… eye candy
American Express (AXP)… credit cards
Capital One Financial (COF)… credit cards
International Gaming (IGT)… gambling machines
Circuit City (CC)… landfill stuffing continues to suffer
Veolia Environnement (VE)… world’s largest water stock
Honeywell (HON)… conglomerate
General Electric (GE)… conglomerate
United Technologies (UTX)… conglomerate
XM Satellite Radio (XMSR)… satellite radio
Legg Mason (LM)… asset management
Callaway Golf (ELY)… golf equipment
Whole Foods (WFMI)… expensive groceries
General Motors (GM)… read the letter from the Chairman
Lead, Nickel

Source: Brian Hunt’s Market Notes Monday, June 30, 2008

You have ExxonMobil to track Big Oil… Goldman Sachs to track Wall Street… Google to track Internet commerce. More entertaining, though, is following the little bellwethers…

For example, we follow Harris & Harris to check sentiment toward nanotech. We follow St. Joe to check on Florida real estate. And for the water industry, we follow Veolia Environnement.

Veolia is the world’s largest publicly traded operator of clean water projects, sewage systems, and desalinization plants. It’s a French company, but let’s not hold that against it. Veolia is one of the fund industry’s favorite ways to invest in the booming demand for clean water.

Veolia has enjoyed huge growth over the past five years… but shares have fallen by a third in six months. Debt and profit concerns weigh on the company, but most water stocks have similar charts. We’re sure the developing world’s need for clean water will help Veolia resume its uptrend someday. But for now, water is finding its way lower.

Source: The World´s Largest Water Stock Is Falling