By Nicholas Vardy “When I was in England, I experimented with marijuana a time or two and didn’t like it. I didn’t inhale, and I didn’t try it again.”
– Bill Clinton, 1992
Then-presidential candidate Bill Clinton’s answer to the question about whether he ever smoked pot became a running joke in the 1990s.
By the time Barack Obama was asked the same question just 14 years later in 2006, he shrugged his shoulders and said, “When I was a kid, I inhaled. That was the point.”
America’s attitude toward pot has changed over the decades.
At the height of the counterculture movement in 1969, only 12% of Americans approved of legalizing pot, according to a Gallup poll.
By 2016, that number had jumped to 60%.
Fast-forward to 2018, and little old ladies in Pasadena can now buy an exchange-traded fund (ETF) that invests in pot-related businesses.
On December 26, the ETFMG Alternative Harvest ETF (NYSE: MJX) became the first marijuana-focused ETF to list on the New York Stock Exchange.
The launch was a roaring success.
After starting with only $5 million, the ETF attracted more than $350 million in just over a month.
If you’ve followed the stock recommendations of some of my Oxford Club colleagues, you made some big money in marijuana stocks in 2018.
Still, buying pot stocks – especially in the U.S. – is riskier than, say, investing in a fast-growing tech company.
After all, it’s unlikely that the U.S. Department of Justice will declare Silicon Valley’s latest darlings “illegal” overnight.
Drug Dealing for Fun and Profit
Pot is a big business.
Arcview market research expects the North American cannabis market to grow from $6.7 billion in 2016 to $22.6 billion by 2021.
That equals an eye-popping compounded annual growth rate of 27% – a rate matched only by the growth of broadband since 2000.
(Grand View Research predicts the global medical marijuana market will reach $55.8 billion by 2025.)
As Arcview points out, you’d be hard-pressed to find any other $5 billion consumer market that can generate a 25% compound annual growth rate over the coming five years.
And there’s another side to the pot business equation.
The legalization of pot has been a boon for cash-strapped state government coffers.
Pot sales have generated the state of Colorado more than $500 million in tax revenues since the state legalized pot in January 2014.
And California’s decision to legalize marijuana for recreational use in 2017 may generate up to $1 billion in annual excise tax revenues.
The Global Pot Legalization Revolution
The global trend is clear.
Portugal legalized all drugs in 2000. Up north, Canada plans to legalize marijuana nationally by July 2018 (though conservative politicians may delay that date).
In the U.S., more than half of the states plus the District of Columbia allow medical use of marijuana.
As California has a population of 40 million, its legalization decision was a watershed event.
If the U.S. fails to legalize marijuana, it will be bucking a growing global trend.
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The Shaky Basis for Investing in Pot
With all the bullishness surrounding pot stocks, don’t forget one thing…
Recreational pot use is still illegal under federal law.
The U.S. Drug Enforcement Agency classifies …read more
Source:: Investment You
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