Some showing that before you post again in favor of "water markets", you have read California Water Code section 1725 et seq., governing changes in points of diversion.Here are my thoughts:
Or, more generally, that you have a way of reconciling your commitment to existing property rights with the destruction of property rights necessarily required for a water market.
(California does have a water market; however as it is largely between governmental agencies the market lacks liquidity.)
CWC section 1725 et seq. could be modified for markets, but there are differences between trading diverted water and consumptive water. This code is a bureaucratic barrier to markets. The essential point is that any modification reflect the rights embedded in 1725.
The "destruction of property rights necessarily required for a water market" is NOT necessary. Most pro-market people in water recognize that farmers should be allowed to trade their rights. The Enviros tend to favor a public trust seizure of water for in-stream uses -- which does pit one side of common law against another.(I will write more on that soon.)
California's market is between governmental agencies because 80 percent of tap water is publicly-delivered, and nearly all ag water is run through the Bureau, DWR or local irrigation districts. It's likely that water markets will be between agencies. The trouble is getting them into that nimble perspective. I think that farmers -- working through irrigation districts -- will be the marginal traders that bring more efficiency to water use in California. Cities are mostly paralyzed in terms of trading, but they will provide the $$.