Marijuana: How We Will Seize Our Opportunity – and Yours
Anthony Wile

Exciting times. Marijuana decriminalization and legalization is moving quickly.

Most recently, as was reported yesterday, the US Justice Department announced that banks and other financial entities could participate in the burgeoning marijuana industry without fear of penalty.

This is a huge step forward, but one I expected because it is obvious a decision has been made at the highest levels that marijuana is to be legalized much like tobacco and alcohol.

I've initiated immediate moves to take advantage of this incredible business opportunity – for our shareholders and our family of readers, many of whom have been with us for nearly five years. I hope you come along with us.

But first, a little background. We wrote recently about the expanding marijuana market in our most recent Trends and Sector Report.

The featured article was, "Marijuana: Smell the Profit" and we pointed out that the marijuana industry when it matures could be "perhaps the hottest – and one of the largest – markets in the world."

We also pointed out that the industry was definitely in flux at the moment, especially in the United States where states are busily legalizing medical marijuana while fedgov remains disapproving.

But we expected that would soon change.

And sure enough, just yesterday it was announced that the US government would allow banks to do marijuana business without penalty.

The blinding speed (relatively) with which the US fedgov moved only reaffirms my initial conclusion that this is one of those elite memes that is seeing a radical and immediate overhaul. Bloomberg reported on the policy change as follows:

Pot Businesses Allowed to Open Accounts With U.S. Banks ... The guidelines were sought by marijuana businesses and the governors of Colorado and Washington state, whose voters in 2012 approved ballot measures allowing the use and sale of marijuana for recreational use. The U.S. government took a step toward legitimizing the marijuana industry today, allowing U.S. banks to offer accounts and other services to businesses in states where medical or recreational pot sales are legal.

The Treasury's Financial Crimes Enforcement Network issued guidelines for banks intended to reduce the danger sellers face in operating an all-cash business. The rules would give law enforcement more information about marijuana business activity, the agency said in a news release.

"Financial institutions can provide services to marijuana-related businesses in a manner consistent with their obligations to know their customers and to report possible criminal activity," according to an agency statement. Marijuana remains an illegal substance under federal law. The guidelines were sought by marijuana businesses and the governors of Colorado and Washington state, whose voters in 2012 approved the sale of marijuana for recreational use. Twenty states also permit medical marijuana.

Companies in states that allow and tax marijuana sales have been operating on a cash-only basis, unable to accept credit cards from customers or using business checking accounts to pay expenses or local and state taxes. This made them susceptible to robbery and forced them to pay their taxes in person and in cash.

Banks' Choice Financial institutions will be able to decide on their own whether to take on the business, a senior official in the financial crimes unit, who asked not to be identified without authorization to speak publicly, said in a conference call.

The Justice Department released a memo today indicating it wouldn't pursue enforcement against banks that do business with the marijuana industry if they comply with eight department priorities. These include diverting marijuana from a state where it's illegal to one where it's not, and in cases where a marijuana-related business is being used by a criminal organization to conduct financial transactions for its criminal goals, the agency said in a memo from Deputy Attorney General James Cole.

This is stunning stuff from a government that insisted for half a century that marijuana was part of a list of criminal drugs that people could be incarcerated for years and even decades for using. (And they were.)

We have also pointed out that decriminalizing – and then inevitably legalizing – marijuana may serve a number of purposes for those who create such policies.

• It may serve somewhat as propaganda – a talking point – that can counteract the observable authoritarianism that is descending over the West like a fog.
  
  
• Also, it creates a new business opportunity – and new entrepreneurial energy – at a time when moribund economies, stretched thin by regulation, taxation and money printing are in need of a boost.
  
  
• Finally, the idea that more people, tens of millions more perhaps, will be inhaling the smoke of a famously calming plant is probably seen as a net positive by those officials charged with keeping the peace at a time of increased social tension.

In any event, the long debate about marijuana is about to end. What took 50 years to resolve may take only another year or so to rationalize. Watch the shock waves ripple throughout the world. Europe, Africa, South America, Asia, even China and Japan will soon treat marijuana as a controlled substance rather than an illegal one.

Eventually, I am certain, laws mandating marijuana's use merely as a medicinal tool will be dissolved as well. It will be legalized for pleasure as well as for pain. Not yet, however.

One of the reasons to keep marijuana confined to a medical context is to control the entrepreneurial surge into the business. By regulating it intensively, governments will be able to control who becomes a major player and who sits on the sidelines.

Larger groups will have opportunities to participate but even these will likely be bought out and consolidated when the industry moves to maturity. Eventually, it is likely that only a few major players will dominate, certainly firms like Monsanto that are already positioned and have appropriate products in development.

Of course, having said that, I want to emphasize that High Alert Capital – as alluded to above – has already made moves to enter this exciting industry on the proverbial ground floor.

We expect to be among those companies that are positioned either to participate fully in the industry or accept a buyout during an inevitable consolidation.

Either way, High Alert Capital intends to reap the rewards that moving quickly can generate. While I cannot reveal the details at this moment, we've already created the architecture to participate fully in this marijuana gold rush.

Health Canada has estimated by 2024 legal marijuana may constitute an industry with revenues of $1.3 billion. In fact, I believe the industry will grow a good deal faster than that – and not just in Canada. This is going to be a worldwide opportunity and one that will benefit those who act quickly and have access to sufficient capital. We have both.

As we pointed out in the Trends and Sector Report, marijuana is not an untried or untested product and it comes with built-in name recognition and a vast and enthusiastic user base. Whether it is the US, Uruguay or other countries, the catchment for legal marijuana will continue to grow as will its promise and ingestion.

I intend to make sure through High Alert Capital Partners that those aware of our efforts – those who have supported them in the past – will have plenty of opportunity to participate in the creation of a once-in-a-lifetime industry.

If you want to know more, please email us: [email protected].

We'll be informing you of more exciting developments as they occur. That will be soon.

Anthony Wile is an active investor, business strategist and consultant, financial markets commentator, publisher and author. Having lived and worked in several leading financial centers around the world, Wile has established an international network of asset managers, banks, family offices, financial analysts, institutional investors and securities firms. Wile is Chairman and CEO of High Alert Capital Partners Inc. and Chief Investment Officer of High Alert Investment Management Ltd., the general partner to High Alert Capital Partners LP.

Anthony is a pioneer of the alternative media, having founded two major websites that have presented many of the top free-market thinkers working today. Many serious commentators have adopted his insights regarding society's Dominant Social Themes and the Internet Reformation; his personal writing and editorials have been reprinted at numerous sites and read by millions. His insights and perspectives have helped shape the conversation on the Internet when it comes to analysis of the world today and how its sociopolitical and economic trends are evolving.

Wile's contributions continue to expand. Now chief editor of The High Alert Trends & Sector Report as well as TheDailyBell.com, Wile has recently written two new books, Freedom Investing (2013) that brings together his sociopolitical insights with economic analysis and The Best of Anthony Wile: Select Editorials and Exclusive Interviews (2013), a compilation of material first published at TheDailyBell.com from 2010 – 2013. In 2003, Wile published his first book, The Liberation of Flockhead, under the pseudonym Yang. The fourth edition of Wile's well-received book, High Alert, originally released in the summer of 2007, was published in early 2013 to a favorable reception.

Former US congressman and presidential candidate Ron Paul said, "High Alert should be read by everyone who wishes to educate themselves about the dangers fiat money poses to American liberty and prosperity. I wish I could get every member of Congress to read this book." Wile has assisted with the completion of over a dozen additional free market-oriented books, working as a collaborative editor to several leading free-market thinkers.

As founder and chief editor of well-known, free market-oriented Internet sites such as Free-Market News Network (FMNN) and The Daily Bell, Anthony leveraged more than 20 years of financial and business experience working with growth-oriented companies in a variety of sectors. In aggregate, these free-market educational websites have reached tens of millions of viewers and helped define the cutting edge of alternative news publishing.

In 2008, Wile founded a Swiss-based publishing firm and began publishing The Daily Bell, a leading alternative news website that publishes daily news analysis, editorials and exclusive interviews conducted by Wile with leading opinion makers such as Steve Forbes, Jim Rogers, Peter Schiff and Marc Faber. While living and working in Switzerland in 2009, Wile founded the Liechtenstein-based Foundation for the Advancement of Free-Market Thinking (FAFMT), of which he served as Executive Director until March 2013.

Anthony graduated from Saint Mary's University (SMU) with a degree in business in 1991 and worked in the Canadian investment industry with Scotia McLeod (Bank of Nova Scotia) and Nesbitt Burns (Bank of Montreal). In 1994 Anthony Wile was made a Fellow of the Canadian Securities Institute, which is a designation awarded to financial services professionals who attain advanced education and experience in the Canadian securities industry.

Anthony has visited every state in the US and every province and territory in Canada. Additionally, he has lived in a number of countries on several continents over the past three decades and has visited or done business in more than 40 countries.

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