Halloween is now behind us. But there were plenty of “tricks” and “treats” to cover in the cannabis sector over this past week. We looked at imminent cannabis legalization in Mexico. Across the remainder of North America, it’s two steps forward, one step back.
While some cannabis jurisdictions are making real progress, others continue to stumble. U.S. support for cannabis legalization continues to grow, but regulatory roadblocks and political intransigence continue to undermine the legal industry.
Monday, we began with a look at “cannabis and social equity”. In the U.S. in particular, the legalization movement is increasingly being tied to calls for legal and economic compensation for the victims of cannabis Prohibition.
While we applaud the motives, we question the ideas here. Especially questionable are calls for special taxes and quotas within the cannabis industry to provide assistance for low-income individuals and visible minorities. The cannabis industry didn’t create Prohibition, that was government. It’s government – not private cannabis companies – that needs to foot the bill here.
Meanwhile, also on Monday, we looked at how the strong support for cannabis legalization in the U.S. hasn’t wavered. The significance of this is that months of fearmongering by the mainstream media over tainted vapes is not weakening support for cannabis legalization.
Here the people seem to be smarter than either the politicians or most media pundits. The illnesses and deaths from cannabis (and tobacco) vaping are a clear regulatory failure. The way to fix a regulatory failure is through legalization and proper regulation.
Tuesday, The Seed Investor was once again examining the California cannabis market. And the picture isn’t getting any prettier. Due to the incompetence of the state government and the anti-cannabis phobias of many of its counties, California’s cannabis black market is even larger today than before legalization.
We didn’t pull any punches. California’s government is killing legal cannabis in that state. And the state also bears a large chunk of the responsibility for tainted black market vapes.
Nationally, we looked at another problem in the U.S. cannabis industry on Tuesday: Mitch’s Mess. Legalizing hemp while keeping cannabis illegal has backfired on U.S. Senator Mitch McConnell. It has created chaos for U.S. law enforcement. The only solution? Full legalization. That’s funny and ironic.
We closed out Tuesday covering the latest news from Choom Holdings (CAN:CHOO / US:CHOOF). Choom confirmed the closing of its acquisition of Clarity Cannabis and its 10 retail locations in the province of Alberta.
Wednesday, we shifted our gaze south of the Rio Grande. Mexico is poised to become the next government to fully legalize cannabis nationally. While there has been a slight delay for further review, legalization is still imminent.
We took a closer look at proposed regulations. Much of it looks fairly similar to Canada’s regulatory structure. Slightly better in some respects, slightly worse in others. What’s a concern is that we still see governments repeating mistakes that successful cannabis jurisdictions (like Colorado) are already past.
Then it was back to Canada for important news – good and bad. On the positive side, British Columbia is in the process of doubling its total cannabis retail stores, up to 156. B.C. has been one of the laggards in legalization among Canada’s provinces.
Countering that progress was news from Quebec. Canada’s second largest province is raising the legal age to purchase cannabis to 21. There’s no “reason” or science behind this new law, just anti-cannabis politicians indulging their paranoia toward cannabis. The effect of this law is to force young adults in Quebec to buy their cannabis from the black market.
Thursday, we stepped back to take a broader look at the cannabis retail picture in Canada. With many provinces now much more active in opening stores, we wanted to bring investors up to date.
Ontario is planning to triple its cannabis stores. Quebec is doubling its total stores. And (as mentioned) B.C. is also doubling its cannabis stores. Alberta now has over 300 stores.
But problems remain. Ontario continues to stumble in the licensing process. Quebec is actually moving backwards in some respects. And while B.C. is opening many more stores, overall cannabis revenues are a cause for concern.
Friday, we led off with more interesting science concerning cannabis use and alcohol use. Cannabis is already helping to save lives by encouraging alcohol consumers to drink less (alcohol kills over 88,000 Americans per year). Now we’re learning that even for heavy drinkers, smoking cannabis can dramatically reduce alcohol-related diseases.
This will not only save lives. It can save enormous sums of healthcare dollars (through treating less alcohol-related diseases). In turn, this is why enlightened governments will start to actively promote cannabis usage among their adult population – as a safe alternative to alcohol (and tobacco).
We finished the week with a look at a medicinal cannabis market in the U.S. that is gaining momentum: Florida. However, while the state is headed in the right direction, it remains a cannabis underperformer in comparison to the U.S. as a whole. Once again, it’s the state politicians who are to blame.
It was a busy week in the world of cannabis. There was interesting news from both Ontario and Alberta that we weren’t able to get to this week – but will lead off our coverage next week. SAFE remains before the U.S. Senate and Cannabis 2.0 is still just beginning in Canada.
While the temperatures are cooling across most of the U.S. and Canada, the cannabis news flow in these countries continues to heat up.
DISCLOSURE: Choom Holdings is a client of The Seed Investor