Invest in marijuana? What are you smoking?
Welcome to the cannabis bubble
Market Watch (US)
Monday, February 11, 2019
Monday, February 11, 2019
The rapid rise of marijuana legalization has created what some people call a bubble for marijuana stocks. It’s reminiscent of the dot-com craze in 1999. An even more apt analogy might be the 1880s, when the transportation miracle promised by newfangled cross-country railroads stoked a mania for profits. Both ended badly: U.S. stocks fell 50% in 2000–2002, after adjusting for inflation, and a quarter of all railroads were bankrupt by 1894. A dozen or so legal marijuana companies trade for wild valuations. The accounting firm PwC Canada last year studied 15 of the biggest in North America. Most of the 15 firms are losing money by the mega-kilo. (See also: Is the Cannabis Bubble finally about to burst?)
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