GoBlue and I were on the phone this morning, chatting about the current state of MSO asset valuation – the reddish hues they’ve been sporting – and we both noted a relatively new tone coming out of social media.
#MSOGang chatter is evolving, and becoming less and less about specific ‘excuses’ (SAFE/up-listing/market manipulation/wait for September/institutional custody issues/ et al)…..and moving into more ‘meta’ concepts. Like quoting books on investing – and worse – now peddling the palliative of the lost: ‘strong hands’.
Yep. A sell-side barker came up with that gem just a few days ago. And while it was phrased more eloquently, a rose is a rose is a rose.
I took a hard run at the level of bullshit being pushed by the carnies back in early February, when the bullshit meter was on overdrive .
I’ve also noticed some new fleas in the circus lately. The ones who talk about ‘price action’ and ‘quick turns’.
These sorts are what I call the ‘gamblers’. Their approach isn’t investing per se, nor is it trading either. It’s gambling. Looking for a moment to plunk down some cash and quickly pick up a little more than one put down.
I gamble, and enjoy it too. I’ve been a student of game theory and blackjack since my university days, and have been to Vegas more than 50 times (not all strictly for gambling mind you. I competed at the national level in both table soccer and billiards, that’s another story).
Now – gambling is different from trading, in that gambling rests upon an independent event. A few years ago, I pointed out the why:
“Trading isn’t gambling, because underlying a trade is assets that are predicated on generating future cash flow. Gambling is ‘betting’ on the outcome of a unique cash flow on a single event: there are no assets. Another try requires another purchase”Guide to Retail Investing – Part IV
My uncle was a fan of the ponies, and the many Saturday’s spent with him taught me the difference between the ‘flats’ and the ‘trotters’. I learned what ‘wheeling to the board’ meant by the time I was 10.
As we talked about this, GoBlue mentioned how the cannabis sector’s carnies (heck, stocks in general for that matter) are currently pandering to the gamblers. And of all the games in a casino – stocks are closest to resembling a poker table.
I made a friend in Vegas one trip long ago, he was a professional poker player. I got to know him better over time, as many of our trips there over the years coincided. He liked the distraction of watching physical games and the tournament atmosphere I was in, and I enjoyed watching him play and gaining insight into his world. I’d asked him once about what had changed about poker over the past few years (it was becoming very fashionable at the time, and a gazillion more people were taking up poker). He told me it was great. Not because of the bigger purses in the tournaments (he really didn’t ‘like’ the Pro Tour. To him, it was a job. ‘Boring’ is how he described it….simply making a living).
He liked the influx of people though because he could make bank so much easier on tables outside the Tour. With a raft of amateurs happy to sit down with a stack of chips (all thinking they know how to play…. having read all the books and ‘practicing’ online for many hours)……my friend was making more money than he ever had.
He did this for years. He made multiples of his Tour earnings lighting up the ‘Earls from Ohio’ and the ‘Jenny’s from California’.
Blue mentioned the movie ‘Rounders’ – where a group of poker professionals do the same thing. As the main character describes it, the professionals weren’t playing ‘together’ to make money, but neither were they playing ‘against’ each other either.
I think this sets up a good analogy, where the various folks on the cannabis sector midway – sell-side, C-Suites, book-runners, commercial media – are the professionals, and the retail investor is the mark.
Nothing collusory going on between the ‘pros’ mind you – but mutually beneficial relationships underpin it all.
I urge the reader to reflect on that. This isn’t tinfoil hat stuff either, simply real world.
In timely fashion, news about Radient Technologies ($RTI) came out this morning – seems a landlord brought in the Sheriff to (re)possess their building from $RTI due to rent being in arrears. I recall being in Edmonton to promote our 2nd WeCann® B2B Conference – and one of their investors differed with my opinion on them at the time ($RTI was a sponsor of our event). The investor offered to broker a meeting with the (then) CEO to explain the biomass boomerang GoBlue had identified (just a misunderstanding one supposes). That boomerang (and its’ identification) is now the centre of prickly legal action now underway.
I mention this because the conviction of that particular investor over-rode their reasoning. There was little objectivity in any of their perspective.
A great example of pump comes from February 12th of this year (the same day I posted my rant on Reddit) . Put out by sell-side at the zenith of the hysteria that spilled forth from Democrats taking the Senate, WSB, and the prospect of NY coming in hot. Many of the phrases road tested over the preceding months are rolled into a tight package that says nothing more than “Hurry Now! Act Fast!”.
That’s the type of sales pamphlet that creates conviction, and maintains it even when the core thesis changes. NY’s legislation was a marker. Schumer’s draft bill another.
Pulling out a ‘strong hands’ argument at this point is a professional at that card table encouraging you not to walk away – that maybe your next hand will be THE hand.
Look – we can’t tell the future. I do expect prices will come back (and find some support, wherever that may be), but that’s like saying it’ll be sunny someday in the future. All I want to do is emphasize prudence with your money, stay aware of when emotions/hope are entering your decision making process, and keep losses to amounts you can tolerate. The professionals are very good at getting money out of your hand and into the game.
TheCannalyst project and research is predicated on helping folks know when one is investing, versus simply gambling
Be safe out there. The internet is the hunting ground and natural territory for the carnies. When moving In tandem, their message is delivered across multiple media platforms, and ‘popular’ feeds can even appear insightful – when they’re nothing more than shit-posts.
Cave venditor (Beware of the seller)
The preceding is the opinion of the author, and is in no way intended to be a recommendation to buy or sell any security or derivative.