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Place Your Bets on Global Warming

Conventional wisdom says you buy solar stocks like First Solar (FSLR), but if warming is happening anyway, how does betting on an outfit fighting it help you? It doesn't.

So while it may seem counter-intuitive, how about a farm technology stock like Monsanto (MON)? The only way to feed people in a warming world is for plants to adapt quickly to that change, and Monsanto's genetically-engineered seeds do that. That's why they already control most of the U.S. corn seed market.

Some may try to point you toward water utilities such as American Water Works (AWK), but as a student of Atlanta history I know an outfit that has done a lot more for water purification, and made a lot more money from it. Coca-Cola (KO) got into water treatment almost a century ago, to assure the uniformity of the product. No Coke? Pepsi (PEP).

An even better bet in this sector would be Coca-Cola Enterprises (CCE), which owns many of the company's bottling operations. If demand for potable water explodes and they can skip the sugar syrup, they can do very well, indeed. They've already outperformed Coca-Cola itself over the last decade.

While industrial equipment runs on fossil fuels, you need it to deal with huge storms, like Superstorm Sandy, resulting from a warming planet. How about some Caterpillar (CAT) -- it's down 15% from its high for the year, so it should be a winner. Terex (TEX) and Joy Global (JOYG) should also do well, digging out from under disasters.

As we saw with Sandy, building supplies of all kinds respond to sudden increases in demand stemming from disasters. Thus get yourself some Home Depot (HD) or maybe some Lowe's (LOW).

Personally I'm in the middle on all this. I expect warming, but I also expect mitigation to limit the damage, at a profit. That's why my personal portfolio has such companies in it as IBM (IBM), General Electric (GE) and Google (GOOG), because it's innovation that will be at a premium once we finally get serious about dealing with this problem.

As I believe we will, all joking aside.

At the time of publication, Blankenhorn owned 20 shares of GOOG, 118 shares of IBM, 157 shares of KO, 200 shares of AIG and 316 shares of GE.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Dana Blankenhorn has been a business journalist since 1978, and a tech reporter since 1982. His specialty has been getting to the future ahead of the crowd, then leaving before success arrived. That meant covering the Internet in 1985, e-commerce in 1994, the Internet of Things in 2005, open source in 2005 and, since 2010, renewable energy. He has written for every medium from newspapers and magazines to Web sites, from books to blogs. He still seeks tomorrow from his Craftsman home in Atlanta.
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