Hello and welcome back to today’s post, dear beginner trader.

In today’s post, I will be discussing an interesting topic with you, a topic you never thought of in today’s financial market trading world, which, of course, is about our natural water, its significance, and how our natural water being nature’s gift could become another new financial trading asset in the world.

Needless to say, there are already lots of tradable assets in the world’s financial market, but to include natural water as part of the discussion could be a game changer in the future.

 

So, let’s get started.

Water will become a traded commodity, like oil, gold, and silver; it’s just a matter of time.

70% of Earth may be covered by it, but less than 1% of it is readily available freshwater, which makes it a scarce resource.

Its value to human life is unquestioned- oil, gold, and silver we can live without- we die without water.

The problem for Wall Street and the major international markets is that in addition to overcoming the difficulty of attaching a price to something so essential to our lives, for it to become a traded commodity, it also needs to fulfill three criteria: standardized/interchangeable, tradable, and deliverable.

 

1. WATER IS MORE EXPENSIVE THAN OIL TO TRANSPORT:

Water is always made up of H₂O, but the levels of minerals and metals it also contains depend on the location it is drawn from, thus making it difficult to standardize.

Its tradability is dependent on location.

There are parts of the world that have so much of it, and their biggest problem is flooding.

In others, it’s a scarcity, and they suffer droughts.

Water is also costly to transport- it costs more to pipe water than it does to pipe oil.

So how can it be said with any certainty that it will become a tradable commodity?

Jean-Louis Chaussade, the chief executive of French utility Suez, recently told the Financial Times that he believed water will become more valuable than oil because of the increased demand from people, industry, and agriculture.

 

2. WATER DEMAND IS INCREASING BEYOND SUPPLY CAPABILITIES:

The United Nations has projected that by 2035, 40% of the world’s population will live with water scarcity. This puts companies in competition with people and farming for supplies.

Local governments around the world are refusing to allow industries to take water from underground to operate, which is forcing them to turn to desalination plants or wastewater recycling to meet needs.

Instinct tells us that it’s correct to give priority to people and agriculture over industry in the supply of water.

It clouds the issue of the government’s inability to manage the provision of water efficiently and how lack of investment in state-run infrastructure has led to the supply problem and why local governments now create barriers to its use by industry.

Converting water into a tradable commodity will result in it being managed more efficiently as a resource.

The misuse and overexploitation of the past would be prevented by assigning it a value.

This thinking prompted Fortune magazine to describe water as the commodity that will determine the wealth of nations in the 21st century, in the same way that oil did in the 20th century.

The counter-argument to treating water as a commodity is that it’s a basic human right and the fear that the world’s poor stand to become worse off as social equality will be traded in for economic efficiency.

Trading water rights is already happening in Australia and, to a lesser extent, in the western US.

The more this happens, the more it becomes accepted and eventually becomes part of the mainstream.

 

3. GOVERNMENTS WILL STRUGGLE TO MEET FUTURE DEMAND:

The need for fresh, clean water will only increase- by 2050, 55% more water will be needed than supplied today- and governments are unlikely to be able to meet that demand because of the massive investment needed to improve supply management.

Markets can play an important role in providing future water security by helping to fund improvements to water infrastructure.

The creation of a futures market to trade water would help to create a baseline pricing mechanism against which regional water tariffs could be fairly set.

There is another fear that water scarcity could eventually see water-rich countries (Brazil, Russia, the US, and Canada) form into a group similar to the Organization of Petroleum Exporting Countries (OPEC) despite the current transportation issues inherent in moving water.

But if serious investment isn’t made into infrastructure- $22 trillion over the next 20 years to maintain current supply levels according to some estimates- then the problem of water shortage will become even more acute.

There you have it, a topic you never thought of in today’s financial market trading world, and how our natural water being nature’s gift could become another new financial trading asset in the world.

 

Congratulations, as you plan and make every right effort to succeed as a financial market trader.

 

Based on its beginner friendly and profitable user experience as a trader, here is my recommended technical indicator for you as a beginner today (Band Single Indicator).

Also, to join other beginners in my recommended ongoing 14-day Career Freedom Opportunity, click here

 

P.S.: If you have any questions regarding this post, kindly go ahead and comment in the comment section below or share this post with your financial market trader friends using the share button on this post page. Thank you!

I want to see you succeed in life and in your financial market trading career.

 

Talk to you soon,

 

Daniel Ohuegbe,

14-Day Career Freedom Opportunity Founder And CashForex Trading System Creator!

14-Day Financial Market Success Mentor! 

Dedicated To Redeeming Your Career And Financial Freedom!