That didn’t take long.

A bullshit piss up in an area of reluctant politicians, municipal desires conflicting with undefined provincial definition, and federal law still un-passed. Might as well be the City of Richmond in BC.

There’s going to be many of these, and uncertainty in rollout that will be unpredictable. Manitoba says ‘no’ to home grow. That’ll last as long as the first court challenge.

10 different Princes and Princesses fighting in 10 jurisdictions (+2 kinda ones) over money, morality, and control. No investor should ever want government near a business.

Regulations distort markets, pricing, and make winners and losers. Occasionally picking them, for less transparent reasons.

You cheer that Company X has signed with the latest several more additional Liquor & Gaming Commissions added to the one already existing?

I don’t.

But, regulations are needed to get it done you say. Public safety and all. And I’d agree.

But the reality is that bureaucracies have metastasized large enough to consume all of the oxygen of margin in booze and cigs and public goods and lottos; they’ve driven industry consolidation; & have rigged gaming: lottos and keno and pull-tabs and slots – they’re at the point where if the same odds of winning were offered in Nevada, the casino owner would be charged with racketeering. Bars and private businesses that are ostensibly compelled to provide, with their liquor liscense in the balance, is a price taker. Whatever the government says the returns are.

More consolidation for scale, more big box everything.

An investor doesn’t want government in markets, unless absolutely nessecary. For professional traders in the sectors, politics is their fundamentals. Imagine doing due diligence on a civil service lifer who’s worked with a host of ministers, is 55, and has post retirement offers in ‘regulatory affairs’ at three different companies. Math’s a little hard.

For a highly politicized product that will create tensions across the layers of government in municipalities & provinces & federally – all 10 little monopolies will do is add cost, volatility, uncertainty, and a frown when a province your player in gets shit on. All within something that’s supposed to keep retail prices capped.

Maybe you’re a guy who can figure out what margins are required in what jurisdictions by how much volume to make returns, and then repeat it 9 times. If you’re good, you’ll make money.

Or maybe your LP that’s expected to make $5/gr wholesale just got fucked. Maybe ask your MLA their views (edit) on what the wholesale price will be. Because at this rate, the politicians will be deciding it as well as the retail price.

EDIT: Seems timely as the media descends to wider reporting on the issue.

All the handwaving about the ‘costs’ associated with legalization at this point are guesses and negotiating positions. Likely based upon ridiculously high estimates.

All there comes from it is another horse to trade on between the politicians, and alot of heat and smoke about nothing. I suspect that compliance costs will be a pile less than is being peddled.

I think the takeaway is that no politician at any level of government is going to let cannabis take a single dime out of their budgets to accommodate it, & they expect their own tax base to increase. Those costs will come at the expense of producer and retailer margins.

And if you think about it, all of these costs are directly linked to inflation and nominal yearly gov’t spending increases. Yet, sales prices are expected – indeed deemed – to remain relatively flat. One may be forgiven if they wonder how long it’ll be until producer margins shrink enough that they begin driving LP’s under. Or in which jurisdictions.

And resulting in provincial politicians making sure the ‘right’ people get an ROFR on an oligopoly.