Alright folks! Many of you are familiar with US cannabis legalization process. You probably bought into companies, enjoyed some crazy rides or left hanging the bag.
The **prospect for US legalization is uncertain** but I want to point your attention to **one big and seemingly unrelated event: what’s happening in Afghanistan**.
**FACT: Afghanistan is the global top supplier of drugs (incl. cannabis)**
Afghanistan is the top producer of heroin. More importantly for this DD, Afghanistan is also likely the top producer of illegal cannabis. Picture below (source: UN) ranks it as #2 but is likely an underestimation: much of the illegal cannabis reportedly sourced from Pakistan/Lebanon/Spain/other is actually coming from Afghanistan.
**THESIS: The US will rather legalize than increase import of illegal cannabis from Talibans**
With the NATO leaving Afghanistan, drug production is likely going to increase. If the US government takes no action, some of it is likely to flow to the US. This will inevitably put pressure on legalization. **Would the US government prefer its citizens to buy homegrown (and taxed) cannabis, or finance the Taliban regime by buying its cannabis?**
# TLDR: Great time to buy cannabis stocks
What exactly? Up to you, this DD is not about individual companies. For transparency I personally like and own positions in ETFs (MSO) and selected US players both small (e.g. CHALF) and large (e.g. CRLBF). Given this DD, I am now going to increase my positions.
Obviously, no financial advise, just my thoughts, let me know yours!
Sources: most numbers come from the UN World Drug Report 2021