## Trading Thirst

In the American Southwest, water laws are based on "Prior Appropriation"—whoever claimed the water in 1910 effectively owns it forever. As climate change causes severe droughts and reservoirs like Lake Mead dry up, Wall Street Hedge Funds have realized they do not need to invent software to get rich. They just need to own the rain.

### FAQ

**Q: Why do hedge funds buy bankrupt farms in the desert?**
A: Water Flipping. The hedge fund doesn't care about the dirt or the crops. They are buying the archaic 100-year-old "Water Rights" attached to the deed. In a normal year, they might make a tiny profit using the water to grow water-intensive Alfalfa hay. However, when a "Mega-Drought" hits, major cities face systemic collapse because their faucets run dry. The city becomes mathematically desperate. Because humans have a completely inelastic demand for water (you cannot substitute water with anything else without dying), the price the city is willing to pay goes to infinity. The hedge fund stops growing crops (known as "Fallowing") and sells their guaranteed water allotment to the starving city for a 1,000% markup. They have successfully commodified the survival of millions of people into a high-yield derivative asset.