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Is investing in the emerging pot industry risky?

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  • Is investing in the emerging pot industry risky?

    I saw this question asked on a forum today and figured I was the perfect person to answer it. I will share my answer here for further discussion.

    Inside of the "pot industry" there are many emerging markets, such as dispensaries, hydro supplies, lighting, tents, fans, nutes... the list keeps growing. The wise investor looks for this type of emerging market that typically shows incredible upside potential, and with little chance of loss. Not only are these investments in growth industries, but at present they are also in limited markets, allowing a very efficient use of advertising/marketing and ease of targeting efficient manufacturing and distribution sites within the hotbed of activity in the legal states. Someone who could not make money in such a market, just isn't trying hard enough.

    So, as a professional economist, I would advise that any investment involves risk, but if done right, I think that the risk of loss in investing in the expanding "pot industry" is low, and the upside potential is virtually unlimited.

    Dr. Em

  • #2
    The feds are not behind this emerging "industry" and it can literally go up in smoke at any given time. They are experimenting on us so they may get on board but if not??????????????? Risky.........just my 2 cents - slo


    • #3
      Some states, or regions (other country's) might go as far as high CBD "only", for certain disabling diseases and pre~existing conditions. It could take many, many years to turn the tide to full medical then to legal recreational and complete decriminalization right here in the states. Risky, yes if you need your money to work for you now.

      But within the hotbed of activity in the legal states, the product your investing in's company, must be showing a continued pattern of rapid growth from that product, from day 1, then you might want to take that risk, if you can handle the loss of your investment, if things suddenly do go bad. Upside potential alone won't do a good enough job guarding your assets, no matter how incredible it may seem, in most cases.

      Those users (Smokers) in the states, that have been blessed by their states efforts, passing legalization legislation to recreational users, in my opinion are being judged by their actions, right now. So if things work well, eventually thoughts of the taxable revenue from Cannabis could override all other concerns, (if) those legal recreational smok'in (pioneers) keep their shit together, for the whole world to see.

      FDA (Food and Drug Administration) approval in some form and Cannabis reclassified from Schedule 1 to 2, here in the states, must happen first if we have any chance at all for national level investment traction to get it's grip~on in the next few years. Manufacturing and distribution sites are still struggling because of no form of approval from the FDA and cannabis federal reclassification hasn't happened yet.

      Cannabis Banking accounts are just now starting to look like there going to maybe, possibly sort of hopefully be addressed, at the federal level and only because of the criminal element presented from those manufacturing and distribution sites. Hopefully it will all work out. If not, like slo was say'in, who knows how long before your investment does or doesn't get busy???? My 2cents, also.............Puff, puff,............ passssss.
      Last edited by Blaze4daze; 07-27-2014, 03:28 AM. Reason: ...Had to re~light the joint and lost my where~abouts (train of thought). Maui~Waui will do that to ya.


      • #4
        Hi, Mega here! Hope everyone is doing well! Nice job Blaze, you explained it well, mega


        • #5
          Saw this article today.
          July 28, 2014 New York Times Urges Marijuana Legalization

          The New York Times editorial board is calling for an end to the federal ban on marijuana use and sales, lending some high-level support to the industry. The newspaper takes a balanced approach to the issue, acknowledging that “there are no perfect answers to people’s legitimate concerns about marijuana use.”
          It then points out the social harms created over decades by anti-marijuana laws, decries Reefer Madness-like arguments and ends by calling squarely on Congress to repeal the ban on cannabis.
          The piece also addresses some business aspects of legalization.
          “Creating systems for regulating manufacture, sale and marketing will be complex,” the editorial reads. “But those problems are solvable, and would have long been dealt with had we as a nation not clung to the decision to make marijuana production and use a federal crime.”
          The impact of such a high-profile media outlet openly backing legalization could be far-reaching.
          While the editorial itself acknowledges that Congress is unlikely to act, the issue of marijuana legalization is primed to become a talking point of the 2016 presidential election.
          The paper’s editorial board promised more articles by its members on this issue in the coming days.
          Other media outlets also jumped on The New York Times’ bandwagon.
          The popular finance information service The Motley Fool ended a weekend article – by claiming, “Whatever happens, we’re headed in the right direction.”


          • #6
            Maybe some good news, let's hope it succeeds.
            July 28, 2014 CBD, Hemp Bill Introduced in House

            A Republican lawmaker has introduced a bill in the U.S. House that would effectively legalize CBD oils and certain hemp-derived products on the national level.
            Citing the hundreds of thousands of children nationally with epilepsy, Rep. Scott Perry of Pennsylvania, has introduced the Charlotte’s Web Medical Hemp Act of 2014.
            The proposal would modify the definition of marijuana in the Controlled Substances Act to exclude CBD oil and therapeutic hemp.
            Notably, the bill does not call for full marijuana legalization.
            It nonetheless is a further step in the federal arena toward normalization of laws related to cannabis, and it could help create business opportunities for companies that extract CBD oils and develop infused products.
            The move follows several states that have recently passed CBD-only legislation across the country.


            • Mega nute
              Mega nute commented
              Editing a comment
              Yeah Blaze, with our luck they will contract with a European co. To make the stuff! How sad would that be! MN

          • #7
            The lobbying thing is always an issue - who can bribe / buy / control / call in favors - boy what a system we have - cotton club, wood industry, oil industry, paper - they certainly don't want to see anything happen so they use terrorist techniques and lies to turn things in there favor but in time I think we will see it placed somewhere around alcohol in the end - I'm leaving out the med situation - pharmacies are another. We have such a problem around the world right now with people wanting to kill each other all over the place that we can't get anything done right now - Ole harry wont allow it - that guy has to go. You kind of nailed it when you stated "the actions of" they are testing different things in states all over trying to see what works best for them - not us - me to - puff time - -slo


            • #8
              Hi mega here, I think our biggest problem is the pharmacy. They are not about to help legalize something that would save people thousands of dollars in pills every year. Some pot is excellent for depression, others for pain.there are strains that are good for minor pains of the body and others that make us eat when we have no spirit to do so! The pill people need to merge with the pot people! All kidding aside, the pharmaceutical companies will not let this happen, and as long as it is illegal they have the upper hand! They are and extremely powerfull group and they have enormous reach and power! We have to break them to have a chance. Anyway, that's my feeling on the matter. Mega


              • #9
                Hey Mega, good stuff on this. I have to say that the pharm's are not standing alone on this. They are teaming up on us - the ones I mentioned like the paper industry from TP to cardboard, the cotton and fiber industries, the building industries and gas and oil. They are all threatened and don't want and upstart to take away profits. I'm sure your aware that the first levi's were made of hemp as well as our constitution(written on hemp). They chased out the hemp industry long ago for "a better product". OK so, a tree takes forever to grow, cotton has to be tended as well as tobacco and ya gotta dig deep for oil. It's really a no brainer here except for the fact that "the powers that be" are heavily vested in these industries and like the profits they gouge out. Say Bud, I'm not arguing I think we pretty much agree, I'm just saying it's a pretty steep hill we have to climb to get to legalities and although I totally disagree with Washington states political policies I was surprised to see the willingness of the voters and our government here to go for it. I'm 65, when I became a teacher I quit playing with it as I find it hard to lie to students. I'm not a teacher any more and can play again and I'm willing to push this issue any way I can and I do. I have written letters stating my beliefs and the positives of said product. Of course all I get back is the usual form letter filled with blather speak. I figure if they got bombarded with letters and phone calls they might start to listen - the squeaky wheel get greased - one of my fathers favorite terms - man I need a puff - slo