Blum Holdings Inc (BLMH)

[BidnessMan]

Not really. California's problem is the same as all states. The federal government has been a do nothing institution since 2014 and has left the management of the marijuana sector to a hodgepodge of states who try but have no idea if what they are enacting will be the law tomorrow or be usurped by the federal government. The states don't have the scientists , legal teams or enforcement personnel to do the job in many cases. Some states are remaining illegal because of their inability to deal with the process of legalizing a federally illegal drug.

Why don't MJ companies make profits? Dilution, poor choices to obtain capital, and uncertainty.

By uncertainty I mean that the sector initially believed the race to the top was a 100 yard dash but in reality it's turned into a marathon so all the companies have been having piss poor quarters because the debt load of all the quick growth is coming home to roost. Derek and many other CEOs are chasing the fixes to these problems which involves increasing margins, smarter growth, and the implementation of lean principles.

280E effects both state and federal taxes but it does hit the federal taxes principally and the state only because what you report at the federal level directly effects your reporting at the state level. Some folks don't believe 280E has any effect which is totally insane. Here is a great article of the gyrations these companies have to go through.

https://www.forbes.com/sites/theyec/2018/07/24/what-cannabis-entrepreneurs-should-know-about-tax-section-280e/#7a716e727377