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Author: mandmweb

Who Wins if Coca Cola Adds Cannabis to Soft Drinks

As more and more states legalize medical and even recreational marijuana, Coca Cola is talking to Aurora Cannabis about putting non-psychoactive cannabis in beverages. Who wins if Coca Cola adds cannabis to soft drinks? We recently posed the question, are marijuana companies good investments. Tilray is the second largest publicly traded marijuana company. Their sales have doubled in the last year and the stock recently went up 17%. With more and more states legalizing marijuana for medical or even recreational purposes, are marijuana companies good investments? Our opinion as expressed at the end of the article: In the end, the marijuana companies that will be good investments will be those which manage their cost of production, compete well on quality and price, and market most effectively. Right now, it is not clear who that will be! Well, the business of effective marketing may be taken care of for Aurora Cannabis if they team up with the largest soft drink maker, Coca Cola. According to CNBC, the marijuana infused drinks will contain non-psychoactive cannabis and not the stuff that creates a “high.” The companies would likely develop health-focused beverages that will ease inflammation, pain, and cramping, the report said. The health market is full of drinks, pills, and foods offering health benefits. According to Allied Market Research, the natural food and drinks market had a value of $79 billion in...

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Why Are Investors Leaving Emerging Markets?

Remember when the BRICS nations were all set to surge into the forefront of the global economy? Brazil, Russia, India, China, and South Africa were all seeing spectacular economic growth and attracting huge amounts of foreign direct investment. These nations are still substantial actors on the world stage but their growth has slowed and in some cases reversed course. Investors have been pulling their money out of these markets and putting it into the USA, Europe, and Japan. So, what happened? Why are investors leaving emerging markets? China Moves to Adjust Its Economy China helped lead the way out of the financial crisis and the Great Recession by doubling down on their investments in both infrastructure and industrial capacity. Nations, like Brazil, saw huge benefits as China’s industrial machine consumed more and more raw materials. The price of oil skyrocketed making not only OPEC happy but also Russia and Brazil. China had been expanding its state-run economy for years and steadily increasing its customer base to span the globe. But, as large as the world economy is, it is finite. And, the industrialized economies of the world got tired of seeing jobs and whole industries pivot to China. China had over-built its industrial base and now saw a substantial slowdown in growth, closing factories, and even labor unrest. A slower Chinese economy needed fewer raw materials and the emerging...

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Which Growth Stocks Are Really Value Investments?

The failure of many so-called “growth stocks” to surge ahead in today’s stock market has puzzled value investors. After all, the traditional use of measures, such as price to earnings ratio and price to asset ratio, has served many investors well over the years. But for many investments in the stock market, it is not working today! Growth stocks keep forging ahead while stocks with low price to asset ratios are lagging. The questions we want to bring up are which growth stocks are really value investments in disguise? And, which value stocks are really not so valuable? Successful Investing by Seeing the Future We commonly use intrinsic stock value as a guide to successful investing. This approach assumes that you can successfully predict the income stream that an investment will generate in the coming years. Then, you look at the current stock price as well as the financial condition of the company. Here is where the Generally Accepted Accounting Practice that is used to do the books may not serve a modern investor very well. There are factors that may overstate the value of a so-called “value stock” and understate the value of a so-called “growth stock”. The Wall Street Journal looks at the traditional way of measuring value stocks and offers some advice to investors. Is “value” dead? Or have we just been measuring it in the...

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Smart Ways to Predict a Correction and Protect Your Investments

Over the last few years you have ignored the nay-sayers who incessantly predicted stock market, real estate market, and economic crashes. You stayed in the market and have seen a rather nice increase in the value of your investments. However, all good things come to an end and those things include bull markets. But, after every stock market correction there will be a rebound. What are some smart ways to predict a correction and protect your investments in order to profit from the next upswing? Market Corrections and Recoveries Is There a Correction around the Corner? There are signs of a market correction that you can watch for. When the market keeps going up too many investors become impatient, looking for more and more profits. They forget risk management. An old piece of investing advice is that you do not have a profit until you take a profit. If you have done well with a volatile stock there is nothing wrong with taking a little profit, paying long term capital gains and holding on to cash until the market offers great deals again. Prior to the burst of the dot com bubble several well-known investors stated that they were essentially cashing out of the stock market because it made no sense. These folks were able to re-invest at very attractive prices a year or so later. Today, according to...

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Do Your Canadian Investments Depend on NAFTA?

Trump decided to renegotiate the 24-year-old North American Free Trade Agreement. This agreement created a free trade zone including Canada, the USA, and Mexico. NAFTA re-negotiations between Canada and the USA have stalled. Pundits see an “investment hesitancy” as investors wait to see how things will work out and what a new deal will look like. The question for those with investments north of border is, do your Canadian investments depend on NAFTA? Is There a Problem with NAFTA and, If So, Whose Problem Is It? Economic analysis indicates that the net result of NAFTA has been to improve the economies of the three nations involved. However, during the quarter of a century that the trade deal has been in effect, many workers have been displaced while others have gained new jobs. A large part of Trump’s appeal to his supporters is that he sees NAFTA as having been a big mistake for the USA and having hurt US workers. Since the start of NAFTA, trade between the USA and Canada increased from $199 Billion USD a year to $518 USD a year. According to Investopedia in their article on the economics of NAFTA, the US per-capita GDP went up 39% while that of Canada went up 40%. It would seem that the net result was about equal for the two nations. Nevertheless, negotiations are going forward albeit slowly....

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