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Cannabis Market Forecast: 5 Top Trends That Will Affect Cannabis in 2023

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Cannabis Market Forecast 5 Top Trends That Will Affect Cannabis in 2023

(CTN News) – As investors frantically wait for banking reform in the US to open the doors to a less complicated financial route, tensions are increasing in the cannabis investing market. In 2023, will they see it?

Outside of the US, ambiguity is anticipated to continue to be a major factor for cannabis, with numerous companies perhaps facing closure; market expansions elsewhere might also hurt the industry.

As 2023 draws near, the Investing News Network (INN) consulted industry experts about the next year and identified five themes that would probably influence the cannabis business from now on.

1a. US political uncertainty set to continue

Investors are used to keeping tabs on events in Congress since politics significantly influences the evolution of the US cannabis business.

Expectations for the introduction of significant banking reform in 2022 were high since it might help current businesses realize their full potential and enable a more stable financial climate for everyone.

Stakeholders, however, are now again in an uncertain situation. Politicians are currently debating whether the Secure and Fair Enforcement (SAFE) Banking Act can be included in legislation before Republicans take over the House of Representatives in 2023 with less than a month remaining in 2022.

According to Charles Taerk, president and CEO of Faircourt Asset Management, “if (Democrats) genuinely wanted to establish common ground, I believe there was time over the previous two years when they could have done that.”

1b. Select MSOs to see higher cashflow

Choosing stocks might be challenging due to the US cannabis market’s fragmentation. Companies and investors alike must be aware of the regulations and criteria for various state marketplaces since the medicine is still illegal on the federal level.

You need to consider businesses that are doing well, according to Taerk.

The Ninepoint Alternative Health Fund’s fund manager mentioned companies like Green Thumb Industries (CSE:GTII,OTCQX:GTBIF) and Trulieve (CSE:TRUL,OTCQX:TCNNF) as being well-positioned at the time.

Strong balance sheets and effective operations put them in a fantastic position to produce larger margins, Taerk told INN. Because of this, we often concentrate on a select few names.

Taerk specifically referred to a change in the multi-state operators (MSOs) he covers’ financial situation. It is anticipated that capital spending plans will conclude, leading to “substantial cashflow gains from these enterprises.”

He said that if you merely consider their prior revenues and cash flow, a significant amount went into capital expenditures. The operational cash flow these enterprises will produce will be significant.

2. All eyes on New York adult-use sales

In 2023, many more state marketplaces are expected to open, according to experts. New York, which will begin regulating adult-use sales, will undoubtedly make a lot of headlines.

The opening of New York has the potential to upend the existing quo in the cannabis industry, according to Mark Sims, CEO of RIV Capital (CSE:RIV,OTC Pink:CNPOF), an American business with a significant interest in this area.

Operators in the current medical market in New York are anticipated to include recreational choices as well, according to Sims.

For the first 36 temporary licenses, the state regulator prioritizes charitable organizations and business owners.

Despite the euphoria, several industry professionals are already highlighting red flags for investors who believe New York would be a sizable market for MSOs.

Higher taxes are truly a competitive disadvantage for those operators in those states since some states have greater regulatory concerns as a result of the state-by-state nature of the market, according to Taerk.

According to Sims, a booming black market is putting pressure on the New York cannabis sector. This problem and a few strange regulatory choices may prevent New York from becoming precisely what investors want it to be.

For those who have placed all their eggs in one basket, it will be difficult. The problem is that if any of (the MSOs in New York) anticipated that New York would be a growth story in 2023, I believe it will be delayed, Taerk added.

When asked about other states to pay particular attention to, Taerk said that given their more benevolent regulatory frameworks, investors shouldn’t discount tiny states.

Compared to businesses operating east of the Mississippi, Taerk noted, “those with strong exposure to the west coast are experiencing more challenging operational challenges.”

He referred to states with “restricted licenses, less competitive rates, and the capacity of the firms to earn money,” such as Illinois and New Jersey and medical states like Pennsylvania and Ohio.

3. Impact of inflation coming home to roost

Almost every economy sector is impacted by inflation, which also influences cannabis pricing and spending habits.

“We are aware that consumer budgets have shrunk. We know that consumer spending on the cannabis market has decreased, at least among discretionary consumers, Nawan Butt, portfolio manager at Purpose Investments, told INN.

The financial expert claims that adjustments to the foundations of the cannabis investment thesis are being made due to changes in spending habits.

Butt considers these modifications to be an exception rather than the new norm. Especially in the shadow of this regulatory overhaul, he said INN, “Cannabis as a concept has been struggling to get any momentum.”

In 2024, according to the management of the Purpose Marijuana Opportunities Fund (NEO:MJJ), expenditure is predicted to increase. However, one market analyst believes that there may still be more losses before that reversal materializes.

Rami El-Cheikh, strategic partner and cannabis lead with EY-Parthenon, told INN that it’s crucial to understand that the cannabis industry is a frontier business still in its infancy. He stated, “The next 12 months will be challenging.”

“This business is confronting all the macroeconomic dynamics that all other industries are encountering for the first time; if you think about it,”

Despite the difficulties these widespread trends pose, Taerk told INN that they are giving certain US businesses a chance to distinguish out.

There are certain businesses inside that. He continued, “who are doing fairly well because they have operational size. “They can survive some of the inflationary pressures that general consumer stocks are experiencing because of their efficiency and operation.

Because certain businesses can handle it, there is a split that we are witnessing.

According to Taerk, these market dynamics are enabling a distinction to be made between the cannabis industry’s “haves” and “have-nots.”

Others continue to have difficulties since they are still developing. Too much development occurs too quickly if they don’t have their affairs in order. They ought to consider some justification, he added.

4. In Canada, it’s all about survival

The future of the cannabis industry in Canada is still unclear. Senior listings have improved firms’ access to financing, but market restrictions have constrained investors’ financial interest.

As a result, the Canadian sector will be judged by its ability to survive a challenging time marked by bankruptcies and foreclosures.

El-Cheikh said when companies leave the market, “it opens up chances for others who may survive and take their market share or acquire their market share.”

One manager of a cannabis investment fund said that, in his opinion, more has to be done to reduce the overabundance of growing operations and retail distribution locations in the Canadian market.

We overbuilt; therefore, there has to be a justification, Taerk told INN. He advised investors to take a closer look at Village Farms International (NASDAQ:VFF), a safer investment due to its expertise in the agricultural sector.

El-Cheikh told INN that one reason to be hopeful about the future of Canadian operators is that he would be carefully monitoring the emergence of chances for local businesses in foreign markets, notably in Europe.

5. Progress in Europe to diversify the market

Market players have long questioned how accessible Europe would be for present cannabis businesses regarding cannabis potential.

As anticipation grows for the likely legalization of adult-use sales in 2023, Germany is perceived as controlling the narrative around legal cannabis in Europe.

Germany has essentially accelerated and streamlined its cannabis laws and restrictions, according to Butt.

Karl Lauterbach, Germany’s minister of health, claims that the nation wants to adopt the Netherlands’ more liberal system. He reportedly remarked, “What we have learned from the Dutch experience is that we don’t want to do it that way.” “We aim to dominate the market as a whole.”

It’s encouraging that other European countries have declared their willingness to imitate what Germany is doing.

According to Butt, this movement is giving the cannabis business more traction since it alters the perception that the US and Canada are the only countries with relevant stories to tell.

It’s positive for the foundations of cannabis that “we’re beginning to see wider penetration in various regions of the globe,” he added.

Final Words

In recent years, cannabis investing hasn’t brought investors much joy, and experts advise prudence and patience in this market in the future in 2023.

Cannabis certainly has stability and promise over the long term, but there may still be financial instability, challenges, and bankruptcy shortly.

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Trudeau’s Gun Grab Could Cost Taxpayers a Whopping $7 Billion

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Trudeau's Gun Grab
Trudeau plans to purchase 2,063 firearm from legal gun owners in Canada - Rebel News Image

A recent report indicates that since Trudeau’s announcement of his gun buyback program four years ago, almost none of the banned firearms have been surrendered.

The federal government plans to purchase 2,063 firearm models from retailers following the enactment of Bill C-21, which amends various Acts and introduces certain consequential changes related to firearms. It was granted royal assent on December 15 of last year.

This ban immediately criminalized the actions of federally-licensed firearms owners regarding the purchase, sale, transportation, importation, exportation, or use of hundreds of thousands of rifles and shotguns that were previously legal.

The gun ban focused on what it termed ‘assault-style weapons,’ which are, in reality, traditional semi-automatic rifles and shotguns that have enjoyed popularity among hunters and sport shooters for over a century.

In May 2020, the federal government enacted an Order-in-Council that prohibited 1,500 types of “assault-style” firearms and outlined specific components of the newly banned firearms. Property owners must adhere to the law by October 2023.

Trudeau’s Buyback Hasn’t Happened

“In the announcement regarding the ban, the prime minister stated that the government would seize the prohibited firearms, assuring that their lawful owners would be ‘grandfathered’ or compensated fairly.” “That hasn’t happened,” criminologist Gary Mauser told Rebel News.

Mauser projected expenses ranging from $2.6 billion to $6.7 billion. The figure reflects the compensation costs amounting to $756 million, as outlined by the Parliamentary Budget Office (PBO).

“The projected expenses for gathering the illegal firearms are estimated to range from $1.6 billion to $7 billion.” “This range estimate increases to between $2.647 billion and $7 billion when compensation costs to owners are factored in,” Mauser stated.

Figures requested by Conservative MP Shannon Stubbs concerning firearms prohibited due to the May 1, 2020 Order In Council reveal that $72 million has been allocated to the firearm “buyback” program, yet not a single firearm has been confiscated to date.

In a recent revelation, Public Safety Canada disclosed that the federal government allocated a staggering $41,094,556, as prompted by an order paper question from Conservative Senator Don Plett last September, yet yielded no tangible outcomes.

An internal memo from late 2019 revealed that the Liberals projected their politically motivated harassment would incur a cost of $1.8 billion.

Enforcement efforts Questioned

By December 2023, estimates from TheGunBlog.ca indicate that the Liberals and RCMP had incurred or were responsible for approximately $30 million in personnel expenses related to the enforcement efforts. The union representing the police service previously stated that the effort to confiscate firearms is a “misdirected effort” aimed at ensuring public safety.

“This action diverts crucial personnel, resources, and funding from tackling the more pressing and escalating issue of criminal use of illegal firearms,” stated the National Police Federation (NPF).

The Canadian Sporting Arms & Ammunition Association (CSAAA), representing firearms retailers, has stated it will have “zero involvement” in the confiscation of these firearms. Even Canada Post held back from providing assistance due to safety concerns.

The consultant previously assessed that retailers are sitting on almost $1 billion worth of inventory that cannot be sold or returned to suppliers because of the Order-In-Council.

“Despite the ongoing confusion surrounding the ban, after four years, we ought to be able to address one crucial question.” Has the prohibition enhanced safety for Canadians? Mauser asks.

Illegally Obtained Firearms are the Problem

Statistics Canada reports a 10% increase in firearm-related violent crime between 2020 and 2022, rising from 12,614 incidents to 13,937 incidents. In that timeframe, the incidence of firearm-related violent crime increased from 33.7 incidents per 100,000 population in 2021 to 36.7 incidents the subsequent year.

“This marks the highest rate documented since the collection of comparable data began in 2009,” the criminologist explains.

Supplementary DataData indicates that firearm homicides have risen since 2020. “The issue lies not with lawfully-held firearms,” Mauser stated.

Firearms that have been banned under the Order-in-Council continue to be securely stored in the safes of their lawful owners. The individuals underwent a thorough vetting process by the RCMP and are subject to nightly monitoring to ensure there are no infractions that could pose a risk to public safety.

“The firearms involved in homicides were seldom legally owned weapons wielded by their rightful owners,” Mauser continues. The number of offenses linked to organized crime has surged from 4,810 in 2016 to a staggering 13,056 in 2020.

“If those in power … aim to diminish crime and enhance public safety, they ought to implement strategies that effectively focus on offenders and utilize our limited tax resources judiciously to reach these objectives,” he stated.

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Google’s Search Dominance Is Unwinding, But Still Accounting 48% Search Revenue

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Google is so closely associated with its key product that its name is a verb that signifies “search.” However, Google’s dominance in that sector is dwindling.

According to eMarketer, Google will lose control of the US search industry for the first time in decades next year.

Google will remain the dominant search player, accounting for 48% of American search advertising revenue. And, remarkably, Google is still increasing its sales in the field, despite being the dominating player in search since the early days of the George W. Bush administration. However, Amazon is growing at a quicker rate.

google

Google’s Search Dominance Is Unwinding

Amazon will hold over a quarter of US search ad dollars next year, rising to 27% by 2026, while Google will fall even more, according to eMarketer.

The Wall Street Journal was first to report on the forecast.

Lest you think you’ll have to switch to Bing or Yahoo, this isn’t the end of Google or anything really near.

Google is the fourth-most valued public firm in the world. Its market worth is $2.1 trillion, trailing just Apple, Microsoft, and the AI chip darling Nvidia. It also maintains its dominance in other industries, such as display advertisements, where it dominates alongside Facebook’s parent firm Meta, and video ads on YouTube.

To put those “other” firms in context, each is worth more than Delta Air Lines’ total market value. So, yeah, Google is not going anywhere.

Nonetheless, Google faces numerous dangers to its operations, particularly from antitrust regulators.

On Monday, a federal judge in San Francisco ruled that Google must open up its Google Play Store to competitors, dealing a significant blow to the firm in its long-running battle with Fortnite creator Epic Games. Google announced that it would appeal the verdict.

In August, a federal judge ruled that Google has an illegal monopoly on search. That verdict could lead to the dissolution of the company’s search operation. Another antitrust lawsuit filed last month accuses Google of abusing its dominance in the online advertising business.

Meanwhile, European regulators have compelled Google to follow tough new standards, which have resulted in multiple $1 billion-plus fines.

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Google’s Search Dominance Is Unwinding

On top of that, the marketplace is becoming more difficult on its own.

TikTok, the fastest-growing social network, is expanding into the search market. And Amazon has accomplished something few other digital titans have done to date: it has established a habit.

When you want to buy anything, you usually go to Amazon, not Google. Amazon then buys adverts to push companies’ products to the top of your search results, increasing sales and earning Amazon a greater portion of the revenue. According to eMarketer, it is expected to generate $27.8 billion in search revenue in the United States next year, trailing only Google’s $62.9 billion total.

And then there’s AI, the technology that (supposedly) will change everything.

Why search in stilted language for “kendall jenner why bad bunny breakup” or “police moving violation driver rights no stop sign” when you can just ask OpenAI’s ChatGPT, “What’s going on with Kendall Jenner and Bad Bunny?” in “I need help fighting a moving violation involving a stop sign that wasn’t visible.” Google is working on exactly this technology with its Gemini product, but its success is far from guaranteed, especially with Apple collaborating with OpenAI and other businesses rapidly joining the market.

A Google spokeswoman referred to a blog post from last week in which the company unveiled ads in its AI overviews (the AI-generated text that appears at the top of search results). It’s Google’s way of expressing its ability to profit on a changing marketplace while retaining its business, even as its consumers steadily transition to ask-and-answer AI and away from search.

google

Google has long used a single catchphrase to defend itself against opponents who claim it is a monopoly abusing its power: competition is only a click away. Until recently, that seemed comically obtuse. Really? We are going to switch to Bing? Or Duck Duck Go? Give me a break.

But today, it feels more like reality.

Google is in no danger of disappearing. However, every highly dominating company faces some type of reckoning over time. GE, a Dow mainstay for more than a century, was broken up last year and is now a shell of its previous dominance. Sears declared bankruptcy in 2022 and is virtually out of business. US Steel, long the foundation of American manufacturing, is attempting to sell itself to a Japanese corporation.

Could we remember Google in the same way that we remember Yahoo or Ask Jeeves in decades? These next few years could be significant.

SOURCE | CNN

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The Supreme Court Turns Down Biden’s Government Appeal in a Texas Emergency Abortion Matter.

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(VOR News) – A ruling that prohibits emergency abortions that contravene the Supreme Court law in the state of Texas, which has one of the most stringent abortion restrictions in the country, has been upheld by the Supreme Court of the United States. The United States Supreme Court upheld this decision.

The justices did not provide any specifics regarding the underlying reasons for their decision to uphold an order from a lower court that declared hospitals cannot be legally obligated to administer abortions if doing so would violate the law in the state of Texas.

Institutions are not required to perform abortions, as stipulated in the decree. The common populace did not investigate any opposing viewpoints. The decision was made just weeks before a presidential election that brought abortion to the forefront of the political agenda.

This decision follows the 2022 Supreme Court ruling that ended abortion nationwide.

In response to a request from the administration of Vice President Joe Biden to overturn the lower court’s decision, the justices expressed their disapproval.

The government contends that hospitals are obligated to perform abortions in compliance with federal legislation when the health or life of an expectant patient is in an exceedingly precarious condition.

This is the case in regions where the procedure is prohibited. The difficulty hospitals in Texas and other states are experiencing in determining whether or not routine care could be in violation of stringent state laws that prohibit abortion has resulted in an increase in the number of complaints concerning pregnant women who are experiencing medical distress being turned away from emergency rooms.

The administration cited the Supreme Court’s ruling in a case that bore a striking resemblance to the one that was presented to it in Idaho at the beginning of the year. The justices took a limited decision in that case to allow the continuation of emergency abortions without interruption while a lawsuit was still being heard.

In contrast, Texas has been a vocal proponent of the injunction’s continued enforcement. Texas has argued that its circumstances are distinct from those of Idaho, as the state does have an exemption for situations that pose a significant hazard to the health of an expectant patient.

According to the state, the discrepancy is the result of this exemption. The state of Idaho had a provision that safeguarded a woman’s life when the issue was first broached; however, it did not include protection for her health.

Certified medical practitioners are not obligated to wait until a woman’s life is in imminent peril before they are legally permitted to perform an abortion, as determined by the state supreme court.

The state of Texas highlighted this to the Supreme Court.

Nevertheless, medical professionals have criticized the Texas statute as being perilously ambiguous, and a medical board has declined to provide a list of all the disorders that are eligible for an exception. Furthermore, the statute has been criticized for its hazardous ambiguity.

For an extended period, termination of pregnancies has been a standard procedure in medical treatment for individuals who have been experiencing significant issues. It is implemented in this manner to prevent catastrophic outcomes, such as sepsis, organ failure, and other severe scenarios.

Nevertheless, medical professionals and hospitals in Texas and other states with strict abortion laws have noted that it is uncertain whether or not these terminations could be in violation of abortion prohibitions that include the possibility of a prison sentence. This is the case in regions where abortion prohibitions are exceedingly restrictive.

Following the Supreme Court’s decision to overturn Roe v. Wade, which resulted in restrictions on the rights of women to have abortions in several Republican-ruled states, the Texas case was revisited in 2022.

As per the orders that were disclosed by the administration of Vice President Joe Biden, hospitals are still required to provide abortions in cases that are classified as dire emergency.

As stipulated in a piece of health care legislation, the majority of hospitals are obligated to provide medical assistance to patients who are experiencing medical distress. This is in accordance with the law.

The state of Texas maintained that hospitals should not be obligated to provide abortions throughout the litigation, as doing so would violate the state’s constitutional prohibition on abortions. In its January judgment, the 5th United States Circuit Court of Appeals concurred with the state and acknowledged that the administration had exceeded its authority.

SOURCE: AP

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