Viewpoint: Marijuana, Market Forces and Why Colorado’s New Pot Law Could Actually Be a Black-Market Boon

By: itznu

Dec 22 2013

Category: Uncategorized

1 Comment

The blackmarket for U.S. high-end ganj is supplied mainly by local, mom&pop, craft-closet croppers. The “Cartels” are a propaganda fabrication. The high-yielding outdoor, big biz growers make medium quality outdoor (seldom goes over 150$/oz.) Legalization could very easily hurt small farmers by driving price down and giving the entire legal market to those high yield, low quality biz growers. I think the discussion on economics in this article is pretty insightful. Sure the writer isn’t a stoner (give me 528$ and I’ll come back tomorrow with a phat z…haha) but economics have been overlooked in the rush to profit. The ganj standard is currently crashing in WA. The legal market looks like it might not break even ever.

Read more: Colorado Marijuana: New Pot Law Could Be Black-Market Boon |

Sorry to repost someone else’s article, but the interface on this TIME page circumvents WordPress.- Annoying

Business & Money

“What’s the price of an ounce of marijuana in Colorado these days?” I e-mailed a friend who I thought might know. The reply: for the top quality stuff, about as much as a share of Apple stock. Apple shares were going for $528 recently, which raises an interesting arbitrage possibility: What’s your guess about the price of Apple and pot a year from now, when Colorado’s legalization of personal pot possession establishes a legitimate commercial market for weed?

My play would be to go long on Apple and short hemp.

Colorado has made the possession of marijuana legal but hasn’t figured out much else. Looking at it from a classical economics perspective, the legitimization of marijuana raises the issue of what happens to the demand, quality, supply and price of a product that has now become legal after decades underground.

(MORE: Marijuana in Colorado: Ready for Business, Complete with…

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One comment on “Viewpoint: Marijuana, Market Forces and Why Colorado’s New Pot Law Could Actually Be a Black-Market Boon”

  1. I find the economics of pot legalization fascinating. Will demand really increase? Can the state inflate legal ganj prices when 90% of the market is illegal, and in a historic low? Will the legal or illegal markets ever reach above 200$/z. for high end again, or was the 400$z. of the 90’s a product of criminalization? What about all the business people and state authorities rushing to siphon huge amounts of money from this new, unproven market? Do they mean to push operating costs up to 1000% of blackmarket costs? Are they going to destroy the legal market before it ever has a chance to make a profit? Fascinating!

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