Now that California - the world's sixth-largest economy - has a legal medical and recreational marijuana market up and running, it's the perfect time to get a finger on the pulse of that market.
It's been an exciting and profitable few weeks here...
The numbers so far are staggering - as I've been predicting they would be for months. As I mentioned earlier this month, in the days following the Jan. 1, 2018, "debut" of recreational adult use, the seven biggest pot stocks by market cap alone bulked up to the tune of $1.7 billion.
My paid-up Nova-X Report readers have seen some nice gains in our pot stock model portfolio, too.
The profits do give some idea of what's happening, but the truth is, California is such a lucrative marijuana market, and so important to the future of legal weed, that I wanted to know exactly what's been going on in the Golden State since it went "green" a few weeks ago.
I'm talking about a much more in-depth picture than you can get in the mainstream media, of course.
You won't get this anywhere else...
For a look at what's coming in this key state, I called one of my best contacts in the legal marijuana arena: Chris Walsh - editorial vice president at Marijuana Business Daily.
This industry newsletter not only puts out a great publication, but it also organizes some of the best conferences in the business.
I'm talking about MJBizCon, which is held in a few locations each year. I attended one last year and brought back a tremendous amount of valuable (profitable) information that I've shared with you folks over the past few months.
Walsh was the founding editor of MBD way back in 2011, when hardly anyone was talking about legalized recreational marijuana. In other words, he's basically seen it all. So I wanted to get him on the record about what he saw on Jan. 1 - the day cannabis went fully legal in California - and in the days since then.
Note: You can learn how to get access to all of Michael's California marijuana market recommendations right here. All his paid-up Nova-X Report subscribers get his favorite plays.
After all, North American legal marijuana sales totaled $6.7 billion in 2016. California - with its nearly 40 million residents - could rake in $20 billion per year in cannabis sales on its own within a few years. And by year's end, legal marijuana sales across the country could more than triple.
Here's why that's great news.
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That kind of revenue growth is going to be a huge catalyst for Nova-X Report's "California Pot Stock Explosion" stocks. So this is a story we're going to keep our eyes on in the months and years ahead.
Walsh tells me that California weed consumers got off to a slow start on New Year's Day... but that was understandable.
"It took a little while, but once folks got over their New Year's hangovers, by mid-afternoon, there were hundreds of people in line," Wash says.
They were lined up, of course, at the 100 or so licensed recreational marijuana dispensaries operating throughout the state.
By comparison, he notes that Colorado - the first state to legalize recreational marijuana - has 500 such retail outlets, and its population is about one-eighth that of California's. However, Walsh says there are between 1,000 and 3,000 medical marijuana dispensaries operating in California. And he predicts that many of those will obtain licenses to sell recreational marijuana, too.
So that shockingly low number - 100 dispensaries serving 40 million people - is likely to get much, much bigger.
"What we're seeing now is really just the tip of the iceberg," Walsh says. "This is just the beginning of the recreational marijuana market there, and it will look a lot different in a year or two. It will be a lot bigger."
The City of Los Angeles, he notes, isn't online yet for licenses. Nor are many other hugely populated counties and cities. Once they get their act in gear, many more dispensaries will open - and growers and manufacturers will be selling a lot more product.
Plus, while there were some hiccups in the first couple of weeks of legal weed, Walsh says supply was not a problem, as it has been in Nevada and other states.
"There have been no inventory problems yet," he says. "California has been preparing for this for months. Now, that might change over time, depending on how some of this plays out."
But, he says, supply issues are a good problem to have. After all, it means you've got a lot of demand.
"We're not going to see the full potential here for years," he says. "After all, Colorado's and Washington's markets are still growing rapidly - and they're the most mature recreational marijuana markets in the country."
Now, I have to keep the biggest opportunities reserved for my Nova-X Report readers. It's only fair.
But Walsh did confirm that the kinds of stocks I've been recommending here in Money Morning are the way to go.
Here's what I mean...
"The ancillary side is where the biggest opportunities are," he says. "Marijuana companies need all the things other industries need - like banking and insurance and compliance help - plus some other unique things... requirements for cannabis are high. You need specialized help. It's going to be a boon."
I was feeling my pot stock recommendations soar - over the course of a year and more - as Walsh laid all this out.
This the perfect "outside" confirmation that the pot plays I've been recommending - like Microsoft Corp. (Nasdaq: MSFT) and Scotts Miracle-Gro Co. (NYSE: SMG), to name a few - are the best way to play this boom.
You see, all of these companies help the marijuana industry as a whole do what it does: make money selling cannabis.
As for U.S. Attorney General Jeff Sessions' bluster about lifting protections in states that legalize marijuana, I asked Walsh if it has had any effect on Californians heading to dispensaries on opening day or since.
He says no.
"This train is moving," Walsh says. "What [Sessions] did was like watching a train roll down the tracks, and sticking your foot out to try and stop it."
California's Jan. 1, 2018, total legalization of marijuana was monumental news for savvy investors. The amount of wealth expected to flow into the Golden State's marijuana market is record-breaking - it could spark a $20.2 BILLION industry there. The windfalls to be made here could be unprecedented - but only if you learn how to position yourself to profit.
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