MJ Stocks Analysis

[dog turd cannon]

The process requires the following (some steps may be skipped):

Felony->Misdemeanour->medical purposes (controlled)->decriminalized->legal

And this path has to be achieved for possession, trafficking, sale and cultivation which are covered by different regulations and in some places by different laws.

So you some all that up there are 200 state laws/regulations that need to be changed before all states are "legal". So, far most states are over turning one at a time and seeing how that works out.

Once, it is legal there will be a need to release those prosecuted as well. All this is a nightmare for government and the prison lobby. Prisons are BIG business.

Currently, only Colorado has gone "green" in all for areas, Washington is "green" in all for areas but has not worked all what that means yet... so 4(8) out of 200 laws are changed. Not sure how anything is tipping yet and 4 more need to written in August 2014 (WA).

So it really comes down to (from my perspective) how profitable MJ is for businesses that lobby and write legislation. This will determine how fast this moves. It doesn't matter about taxes so much as can private enterprise profit on growing marijuana.

This is a good article:

http://news.humcounty.com/How_Much_Money_Do_Pot_Growers_Make_.html

There is a very honest statement at the end:

"Of course, the primary reasons that profits are so high in the marijuana business are that prices are inflated to account for the inherent risk of operating in an illegal market, and, most importantly, pot growers aren't usually claiming the income on their federal and state taxes, which allows them to keep an additional 15%-35% of their gross profit compared to what a legitimate business would pocket."

Legalize it and tax the grower and the grower will loose ~30%. Then add competition and price pressure will drive the price way down. Now MJ can be grown pretty much in any basement unlike grapes which are grown in a few select soils so the price pressure may be great. You will get margins more comparable to specialty plants.

There isn't much reason for a company to lobby for change in legislation if there isn't money to be made. Better, to allow it to be legal for medical use only. Limit production and sale. Keep the price up. Just my opinion.

I feel that legalizing MJ is about at the same place in time as the EV1 electric car was in the 90's.
http://en.wikipedia.org/wiki/General_Motors_EV1

It took another 15 years for Tesla to show up and that took a lot of money from Elon to move anything. So, if someone with billions starts lobbying congress this could go a lot faster but I think the "tipping" point is pretty far off.

Before January I would have said 15 - 20. But, this currently rally is stronger than I had expected so maybe 8 - 12 years???