Wednesday, November 3, 2010

Post-election "green" investing outlook

Tuesday saw the end of some market uncertainty with the defeat of California’s Prop 23. Enactment of this proposition would have been a real blow to alternative energy and alternative fuel companies in the U.S. Solar company shares, which gain most of the mainstream media attention, were hard hit during the past 1 ½ weeks but saw an across the board bounce today.

One of the few solar stocks not sharing in today’s gains was First Solar(FSLR), which saw a $13.00 one-day drop last Thursday and further loss on Friday. Most of these stocks will take a few weeks to regain their late October price levels, if not longer. With demand and production continuing to grow, many solar stocks seem destined for new 52-week highs before the end of the year.

Much uncertainty remains among green investors after the election. The Republican party is well known for its support of big oil and coal. They are equally well known for their lack of support for energy efficiency/saving measures and alternative energy sources. Look for federal support programs for everything except ethanol to be slashed, particularly funds coming from the Department of Energy. At least the military branches do not need direct congressional approval to continue spending on alternative energy.

If Republicans were really as patriotic as they like to claim they would be using the U.S. military alternative energy initiatives as an example for the entire country to follow. Our biggest national security issue is more likely energy-dependence on other(often unfriendly) countries than terrorism. And we don’t and never will be able to produce enough oil domestically to meet our current demand.

Obstructing legislation to reduce domestic oil demand, such as higher mpg standards, higher lighting efficiency standards, higher energy efficiency for household appliances, etc…, does nothing but extend and exacerbate an already bad situation. Blocking federal and state incentives for alternative energy installations only lets China and the European nations widen their lead over the U.S. in implementation of these technologies. When the real petroleum crunch does come, those countries with the greatest percentages of solar, wind, geothermal and nuclear energy production will have huge strategic advantages.
America needs to grow food, not fuel

The reason ethanol receives so much support in the U.S. is its reliance upon Big Agriculture. No biomass-based petroleum substitute can be produced in the quantities needed without massive amounts of fertilizer, pesticides, genetically-modified seed stocks and millions of miles put on petroleum-powered tractors, harvesters and trucks. We need an innovative alternative to the internal combustion engine, not a biological substitute for petroleum fuels.

When did the U.S. become afraid of innovation? When did maintaining the existing business status quo become more important than being the world’s technology leader? When did saving a few dollars or a few jobs today start to overshadow the very future of the country? Our political leaders from both parties are bickering about ideological irrelevancies while our credibility with the rest of the world evaporates. When did being a Republican or a Democrat become more important than being an American?

Alternative energies are here to stay. Private industry leaders and the military see the writing on the wall and are taking the initiative to break away from petroleum dependence. But the process would be much faster and more integrated if there were national leadership rather than just national lip-service. For investors, alternative energy and smart-grid companies remain the wave of the future no matter what happens in Washington.

Tuesday, November 2, 2010

Book review: "Plumbing" by Sunset Books

Every homeowner and every real estate investor should have at least a rudimentary level of plumbing. Such knowledge is useful during initial inspections(not to replace a professional inspection) prior to purchase and to be able to describe needed repairs to a licensed plumber after purchase. Many dollars can also be saved over the years by doing basic plumbing repairs and upgrades yourself instead of hiring a professional.

“Plumbing”, published by Sunset Books as part of their You Can Build series, is an excellent do-it-yourself book. It is written clearly and concisely by Esther Ferington and the editors of Sunset Books. All major topics are covered in depth along with illustrating color photos. This book is a good starting place for those with no knowledge of plumbing and also a good refresher for anyone that is out of practice.
A lot of money can be saved by doing simple plumbing jobs like installing a new faucet yourself instead of hiring a licensed plumber, especially if a problem occurs during the weekend.

The book starts by surveying the tools and materials used in common plumbing systems. The specific use of each tool and pipe material is covered, as well as the reasons for using them. Basic bathroom and kitchen repairs and upgrades come next, followed by a thorough chapter on sinks, clothes washers and water heaters. The final chapters are about installing new plumbing lines and outdoor plumbing projects.

For any homeowner, real estate investor and/or landlord trying to save money on simple plumbing repairs or upgrades, this is a great book that will get you through fixing a leaking toilet, replacing a faucet set or installing a low-flow shower head. Those more confident of their abilities will find detailed instructions and illustrations for replacing/installing new sinks, toilets, clothes washer connections, etc… At the very least, enough plumbing information can be gleaned from a thorough reading to know if a hired, licensed plumber is on the right track.

Suggested retail price for “Plumbing” is $24.95 in soft-cover. has it available for $18.21 new. Many local libraries will have it in stock as well.

Monday, November 1, 2010

The current state of the "green" stock market

Solar, wind and wave power are the future of energy

The upcoming elections, recent earnings reports, continued economic unrest and Prop23 in California have not been kind to my “green” stock portfolio. The past two weeks have seen pullbacks in several sectors even though the DOW and NASDAQ continue to see very slight gains on most days. I do not see a Republican majority in congress and/or the Senate doing “green” share prices much good but am not yet convinced that will happen.

Solar shares have taken a big hit across the board. A few seemed to be shaking it off and recovering last week but have since stalled again. I am predicting at least three to four weeks to start approaching the October 15 levels again. A Republican majority and passage of Prop 23 could make that a much longer road.

Mining stocks, and rare earth/lithium miners in particular, are also down and consolidating. These stocks should bounce back quickly as Chinese export concerns remain high along with high demand. If the overall market starts to falter, silver and gold miners should benefit most.

Water treatment and infrastructure shares barely stumbled and are already nearly recovered. The major players, such as Calgon Carbon(CCC), Veolia Environment(VE), Consolidated Water(CWCO) and Watts Water Technologies(WTS) should do well. Consolidated has had a bad year but seems to have turned around. Calgon and Watts are performing strongly.

Battery technology companies remain steady performers and could start to surge at any time. Demand will grow with increasing market penetration by electric vehicles and commercial solar/wind power installations. New research breakthroughs could put a company into leadership position quickly.

Most of the maritime shipping companies, particularly those based in Greece, saw a slight pullback last week. Continuing weakness of orders, rising fuel costs and Greek economic uncertainty remain issues for these stocks. Nevertheless, goods still need to be moved, international trade continues and I remain bullish on maritime shipping as the cheapest way of getting large amounts of product from here to there.

Wind power company shares are mostly flat. Even with increased demand, especially overseas, this is not likely to change anytime soon. Wind is just not glamorous enough for most investors and does not have as much perceived potential for use on individual homes or commercial buildings.