This Correlation Between Legal Medical Marijuana States and Traffic Fatalities Is Shocking
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After beginning 2016 with cannabis legal in 23 states for medical purposes, and four states for adult use, the year closed with 28 states having legalized medical marijuana and residents in eight states having legalized recreational weed. Most notably, legislatures in Pennsylvania and Ohio passed medical marijuana laws without bringing votes to the people, while residents in California overwhelmingly passed Prop 64 (recreational legalization), which could add $1 billion, or more, in annual tax and licensing revenue to the state.
The dollar figures surrounding the legal pot industry are truly mind-blowing. Cannabis research firm ArcView has predicted that legal marijuana sales could grow by 30% annually through the remainder of this decade, while investment firm Cowen & Co. went a step further and forecast legal sales growth from $6 billion to $50 billion over the next decade, or more than a 23% compound annual return per year.
Safety continues to be a priority for regulators
However, even these dollar figures aren't enough to sway the federal government, which maintain's the drug's schedule 1 status. As a schedule 1 drug, marijuana is deemed illegal and defined as not having any medically beneficial qualities. In August, the U.S. Drug Enforcement Agency denied petitions that requested the rescheduling or de-scheduling of cannabis.
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This isn't to say there aren't a handful of companies pushing the envelope of innovation. Both Hound Labs and Cannabix Technologies are testing their versions of marijuana breathalyzers that they believe could make law enforcement's job a lot easier. But once again, without a concrete scale to determine what level of impairment is unacceptable, these technologies could struggle to find buyers.
Long story short, there's still a lot left to be done in demonstrating to lawmakers on Capitol Hill that marijuana use won't lead to a catastrophe on the roadways if legalized nationally. This uncertainty, along with a number of inherent disadvantages faced by cannabis businesses, is exactly why investors should be monitoring pot's progress from the safety of the sidelines.
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