For The First Time In History, Water Trading On Wall Street

For The First Time In History, Water Trading On Wall Street

Back in September 2020, CME – world’s largest futures exchange – had announced that soon Water Futures linked to the $1.1 billion California spot water market would be launched. And now water has officially started trading on the Wall Street for the first time history. But what caused this move? Will water become cause of wars? Hope not.

Crux of the Matter

Water Trading On Wall Street
Water Futures will enable traders to hedge against, or bet on the potential for water scarcity. There is speculation that the high-profile investor Michael Burry of “The Big Short” is eyeing to invest in this water contracts.

What Is A Futures Contract Though?
An agreement to buy or sell an asset, like water, at a specific time in the future at an agreed-upon price is known as a futures contract. Oil, precious metals, food commodities, natural gas, even electricity, etc have historically been traded via Futures Contracts.

HowWill Water Be Traded?
An acre feet is the amount of water it takes to cover an acre over land in one foot of water. One contract would represent 10 acre feet of water – a contract’s price will be determined by demand and supply of the underlying asset, water. In metric system, it is equal to the amount needed to cover 40,468 square metres in about 30 cm of water.

With nearly two-thirds of the world’s population expected to face water shortages by 2025, water scarcity presents a growing risk for businesses and communities around the world, and particularly for the $1.1 billion California water market.

Tim McCourt, Global Head of Equity Index and Alternative Investment Products, CME Group

Water Scarcity
“Water shortages could affect around five billion people worldwide by 2050,” says the UN. The reason for water contracts linked to California is that this area is severely affected by water scarcity where record temperatures and raging wildfires have made it more critical.

Climate Change
Scientists and advocates for action against climate change have warned about the potential of water to create wars between countries. Water demand for drinking, household purposes, agriculture, energy, and in developing cities is increasing with each day. Looking at the availability of less freshwater on the Earth, it is likely that in the coming times water contracts may have huge value.

  • Michael Burry is an American physician, investor, and hedge fund manager. Burry was the first investor to recognize and profit from the impending subprime mortgage crisis. He was the founder of the hedge fund Scion Capital, which he ran from 2000 until 2008.
  • Water conflict is a term describing a conflict between countries, states, or groups over the rights to access water resources. The United Nations recognizes that water disputes result from opposing interests of water users, public or private. A comprehensive online database of water-related conflicts—the Water Conflict Chronology—has been developed by the Pacific Institute. This database lists violence over water going back nearly 6,000 years.
  • Rajendra Singh is an Indian water conservationist and environmentalist from Alwar district, Rajasthan in India. Also known as “waterman of India”, he won the Magsaysay Award in 2001 and Stockholm Water Prize in 2015. He runs an NGO called ‘Tarun Bharat Sangh’ (TBS), which was founded in 1975. The NGO based in village Hori-Bhikampura in Thanagazi tehsil, near Sariska Tiger Reserve, has been instrumental in fighting the slow bureaucracy, mining lobby and has helped villagers take charge of water management.
  • Presented annually since 1991, the Stockholm Water Prize is an award that recognizes outstanding achievements in water related activities. The Stockholm Water Prize Laureate is announced each 22 March at the UN World Day for Water and honoured each August during the World Water Week in Stockholm at a Royal Prize Ceremony and Banquet in the Stockholm City Hall.

Package For Space Travellers: 4G & Water On Moon

Package For Space Travellers: 4G & Water On Moon

In 2018, there were reports of a large saltwater lake found at Mars’ south pole. Now planetary researchers have confirmed its presence, along with 3 more sub-surface water bodies. Even SOFIA has detected water on moon. Meanwhile Nokia’s (NOK) Bell Labs has signed a deal with NASA to set up a 4G network on the moon. Is it time to go to space for your next vacation?

Crux of the Matter

Water Discovered On Moon
Using NASA’s Stratospheric Observatory for Infrared Astronomy (SOFIA), water has been found on the sunlit surface of the Moon, in Clavius Crater. This indicates that water molecules may be distributed across the lunar surface, and not limited to the cold, shadowed places only.

Nokia and NASA
NASA has awarded Nokia’s Bell Labs, a grant of $14.1 million to deploy a 4G cellular network on the moon, in order to support lunar surface communications at greater distances, increased speeds and more reliability than current standards. Nokia plans to partner with spaceflight company, Intuitive Machines for the entire 4G network layout.

NASA’s “Tipping Point” Project
NASA has a 2028 goal to build a moon base and sustain a human presence later on. So it has already dedicated $370 million to lunar innovations including remote power generation, cryogenic freezing, safer landing etc. 4G setup and eventually 5G, is a part of this grant.

Will Moon Have Better Network Than Earth?
Yes, 4G has the potential to work better on the moon due to the absence of trees, buildings, or TV signals, that interfere with the cellular network here. It will be designed to withstand extreme temperature, radiation, and space’s vacuum while staying functional during lunar landings and launches, even with significant vibrations.

So Can Astronauts Tweet Their Lunar Rover Selfies?
Yes, Nokia says astronauts can use its wireless network for controlling moon rovers, real-time navigation over lunar geography, and streaming high-definition videos from space.

Lakes Discovered On Mars
The discovery published by Nature Astronomy was made using radar data from the ESA (European Space Agency)’s Mars-orbiting spacecraft, Mars Express. It followed the detection of a single subsurface lake in the same region in 2018, by using a data set comprising 134 observations from 2012 to 2019.

The Eureka Moment For MARSIS
A radar instrument called the Mars Advanced Radar for Subsurface and Ionosphere Sounding (MARSIS) was being used to probe the planet’s southern polar region when it found bodies of liquid water trapped under more than 1km of Martian ice.

How Does MARSIS Work?
The instrument sends out radio waves, which bounce off layers of material in the planet’s subsurface and surface area. The way this signal is reflected back indicates the type of material that is present at a particular location, like say rock, ice, or water, for example. MARSIS works similar to the glacial lake detection method used on Earth.

What Do We Know About The 4 Lakes?
The lakes are spread out over 75,000 sqkm, an area which is roughly 1/5th the size of Germany. The largest, central lake is 30km wide and is surrounded by 3 smaller lakes, each a few km in size. However, it is yet to be confirmed, whether they are made of water or sludge. The Chinese mission, Tianwen-1 can verify these claims, on the way to Mars, after it launches in February 2021.

  • Apollo 17 was the last manned moon landing that took place in 1972. No manned moon landing has taken place ever since.
  • After the failed soft landing of Chandrayaan 2, ISRO is planning to launch a similar Chandrayaan 3 mission in the second quarter of 2021. It will only include a lander and a rover.
  • Ganymede, Jupiter’s moon, is the largest moon in the Solar System. It is bigger than Mercury.
  • Due to Moon’s weaker gravity than Earth, a Person would weigh about one-sixth (16.5%) of its weight on Earth.
  • Project A119 was a top-secret plan by the United States to detonate a nuclear bomb on the Moon. Americans were falling behind the space race and this was planned to show the force of the United States and boost the morale of American Scientists.