Marijuana Industry Deep Dive
107: Who's got the herb and profits man?
With the recent Biden announcement that pardons will be given to felons with Marijuana charges (an obvious mid term vote gaining effort), we thought it might be a good time to touch on the basics of the Marijuana industry and go over the dynamics, projections, risks, and opportunities that exist.
The move comes as midterm elections come close, with at least five states that have legalization of adult-use cannabis on the ballot.
Cannabis was once a highly taboo topic but has since become what some consider to be one of the fastest growing industries for the coming years alongside AI, Biotech, Blockchains, and Recruitment.
Although the Devil’s Lettuce is still illegal under federal law as a Schedule I drug, the legal industry worldwide and within the United States has grown significantly and the future looks to high-ly profitable for well positioned investors who know a little bit about the landscape and the risks involved.
There use to be a high degree of taboo surrounding the weed industry but in the last 5-10 years Wall Street, researchers, and businesses have taken a keen interest in what will likely be a massive recreational industry once federal regulation eases.
Many of us are likely familiar with Marijuana from high school, college, or our early 20’s and I have certainly noticed that the vice is favored by more and more young finance and tech workers, likely as a way to decompress from the stress filled schedules.
Joe Rogan, Snoop Dog, Elon Musk, Bernie Sanders, and many more celebrities/politicians/activists have contributed to the popularity and proliferation of pot-positive attitudes in the youth of today. On the medicinal front, Marijuana and one of it’s active chemical compounds CBD — has gained immense support for the ability to treat a variety of disorders though this is no new secret. Ancient cultures have long employed the medicinal qualities of the plant.
Marijuana is the most commonly used federally illegal drug in the United States; 48.2 million people, or about 18% of Americans, used it at least once in 2019 (most recent data - CDC). I expect this is much higher now.
The vast majority of the marijuana industry remains illicit globally. While the size of the illicit trade is unknown estimates put the combined legal and illicit markets at $350-$400B. Some true size lords like French Canadian Jimmy Cournoyer who known as The Pot Playboy and the King of Pot, made over $1B dealing in illicit pot.
While the green gold rush on the ground has been well underway since the first caveman found a valley full of Cannabis and the Cartels in Mexico scaled the plant into a global empire, the digital green gold rush has yet to begin. We expect the next 3-5 years to be excellent times to own marijuna stocks, companies, and ETFs.
In the coming years there will be immense opportunities in this space for investors and retail to capitalize on.
The pandemic, work from home, and easing stigmas about the use of marijuana have all had potentially future positive impacts (although making in store visits harder) on demand dynamics and the global market is expected to grow from roughly $28 billion last year in 2021 to nearly $190 billion in 2028 at a CAGR of about 32.04% in forecast period, 2021-2028 (Fortune Business Insights).
With that being said, the last two years brought many challenges to the industry as well that could pose large risks if they continue (more on that later).
To make it straightforward we will cover three main aspects today
Overview of Marijuana/Cannabis
Market Structure
Marijuana Stock Opportunities to watch
We hope you enjoy this deep dive which is an excellent resource for those new to weed in general, those looking to learn more about the financial industry/markets behind the drug, and for seasoned experts to confirm or validate existing sentiment/theses on their thoughts on the industry.
“The illegality of cannabis is outrageous, an impediment to full utilization of a drug which helps produce the serenity and insight, sensitivity and fellowship so desperately needed in this increasingly mad and dangerous world.”
-Carl Sagan
We spent a considerable amount of time compiling and synthesizing this information to give you a highly succinct but thorough evaluation of where the weed markets stand some of the opportunities that you have to profit from them in the coming years.
To put it bluntly (no pun intended) we do deep dives like this 2X a week for our paid subs and we’ve consistently heard that the subscription pays for itself dozens and dozens of times over again so if you’re ready to make the leap consider upgrading to join thousands of bankers, investors, hedge fund lords, tech bros, entrepreneurs, crypto folks, and others searching for no nonsense - direct alpha, insights, and commentary on the most pertinent and interesting topics in our world today!
Not to get all Jordan Belfort on you - but, if you take any reasonable amount of money ($100+) and invest for the long term in some of names we cover here - I can assure you the $5.00 it takes to access not only this piece, but our entire archives of over 110+ posts, will be made many many times over.
Let’s spark up…..