13 ms·

Plummeting Marijuana Prices Create A Panic In California

128 points by mcantelon 16y ago

nkassis 16y ago
This is pretty interesting situation considering that it's as close to free market as you can get. Legalization could be good or bad but I think the more people, who currently don't use it due to legality, would consume pot and thus keep the prices stable. I have no experience with growing pot but it seems to be a pretty easy thing to do and thus supply is abundant. The market should readjust but that will be harsh
- deleted 16y ago
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- pstuart 16y ago
  I have yet to hear a cogent argument against legalization.
  - hugh3 16y ago
    I was tempted to give one, but I don't think this is a good forum for discussing such a boring political issue. Please keep pro/anti drug legalization arguments elsewhere.
    - fjabre 16y ago
      Why? Flag the posting then. It's certainly relevant to the article.
    - blhack 16y ago
      >Please keep pro/anti drug legalization arguments elsewhere. Please don't take this the wrong way, but your account is 49 days old...I'm not sure that you're at the "I get to tell people what sorts of discussions they're allowed to have" stage yet, especially not to people that have been here for almost three years.
      - hugh3 16y ago
        Would it be okay if I had been around for 1021 days like this guy? http://news.ycombinator.com/user?id=hugh http://news.ycombinator.com/user?id=hugh
        blhack 16y ago
        Honestly? Not really. It's an open forum, I don't think it's really ever good form to tell somebody "hey, you're not supposed to talk about that here." (unless it's spam, in which case, just downvote. Saying "don't talk about that" is off-topic and has been specifically addressed by PG in the past.) I'm sorry I didn't know that you had an alt account, it's just annoying when people start showing up and trying to dictate how things "should be" to established members of an existing community.
    - jokermatt999 16y ago
      I'm new(ish) here, but I don't see why not. HN tends to have a much better atmosphere for serious discussion than most web forums I've seen. I'd be happy to hear both sides of this argument here, and hopefully to see more reasonable debate than what is usually presented.
      - davidw 16y ago
        It has a pleasant atmosphere in part because it mostly avoids inflammatory topics like politics. I'd much rather talk startups and business, and maybe living abroad with patio11, for instance, than discuss why he's a Republican and I'm not. The former is bound to be a useful, interesting discussion; the latter most likely not. Actually, I'd be ok with the latter discussion too, but only in person, not on an internet fourm.
    - deleted 16y ago
      [deleted]
  - aptimpropriety 16y ago
    Try this thread from a year ago: http://news.ycombinator.com/item?id=554166 http://news.ycombinator.com/item?id=554166 which links to this article: http://steve-yegge.blogspot.com/2009/04/have-you-ever-legalized-marijuana.html http://steve-yegge.blogspot.com/2009/04/have-you-ever-legali... Perhaps not an argument against, but certainly a 'reality' check argument against the "it's so obvious we should do it" mentality that seems to thrive in online forums.
    - Retric 16y ago
      Work is hard, let's go shopping. Is a poor argument. The real issue is the total difficulty of all issues not simply the number of them. EX: A "major" issue is it's hard to detect if someone is currently under the effects of pot. Because, apparently drug test are designed to detect if you have smoked not if you are currently impaired. However, an officer can do a road side sobriety test without using a breatilizer so it's not a real issue. Now if there was some sort of bioaccumulation of pot ever time that caused massive issues then that single issue could prevent legalization on its own.
      - moe 16y ago
        Now if there was some sort of bioaccumulation of pot ever time that caused massive issues then that single issue could prevent legalization on its own. I don't see a problem. Pot use can be detected, sometimes days (or weeks) after. The law in most of europe is simple: If you're tested positive while driving then your license is gone. Seems fair enough.
        Retric 16y ago
        My point is if you get high and are only impaired for 8 hours then after 8 hours if you are not impared you should be able to drive. If you must wait 2 weeks after smoking to drive then it's not exactly legal for most people. The bioaccumulation idea was a separate issue; if smoking pot for 30 years turned people into zombies with an uncontrollable desire to eat brains then it should be illegal regardless of other negatives. (I could not think of any issues like this so I made something up for the sake of argument.) PS: You can probably detect pot in the blood of 75% of Americans if you set your threshold low enough. (Second hand smoke from 2 blocks away etc.) That does not mean it's impossible to separate smokers from non smokers just you need to set a reasonable threshold and accept you might miss the occasional smoker.
  - marltod 16y ago
    The most effective argument is that it is a "Gateway Drug". There is no proof that weed makes people use crack or heroin but it is a good way to scare the public.
    - awolf 16y ago
      Marijuana is a gateway drug to other illegal drugs because it itself is illegal. In order to get marijuana you need to go see a guy that is ALSO selling other drugs (the kind that are actually dangerous). Legal marijuana makes it so that people don't start using more dangerous drugs on a whim. They are no longer presented with an easy opportunity. If pot is on the same level as alcohol which do you think is more of a gateway drug? One that makes you introverted and cautious or one that makes you more confident while simultaneously impairing your judgement?
      - pyre 16y ago
        It's also a 'gateway drug' in that you don't go crazy and commit mass-murder when you try it the first time, so you start to disbelieve all of the anti-drug propaganda and maybe decide that 'they' were lying about the harder drugs too.
  - ErrantX 16y ago
    I have yet to hear a cogent argument against legalization. I have a couple of pretty simple one (it's worth considering). The long term affects of pot abuse are pretty easy to develop - I've seen medium-heavy users become fairly "brain dead" after several years of use. This is entirely from observation but it seems to occur faster than the same effect due to alcohol abuse. As a result we could see quite a few problems from more long term users. It is also harder to determine if someone is under the influence. This would mean some industries would have to begin mandatory drug testing prior to performing sensitive work - random examples: doctors, pilots. That's costly, time consuming etc. And if the long term affects of the drug are as pronounced as I suspect you could see heavy abusers in those fields actually pass drug tests and still fail to concentrate at a critical moment. It's certainly an area that needs a lot more research before legalization occurs.
    - pstuart 16y ago
      But this presumes that keeping it illegal prevents people from using it, and it clearly doesn't. Mandatory drug tests are common already (Home Depot does drug tests on all employees -- don't you feel safer about hardware?) People's performance are also impacted by stress, sleep deprivation, etc. - they should be monitored for performance, not blood chemistry. >It's certainly an area that needs a lot more research before legalization occurs. No it doesn't. It's safer than other existing legal drugs: http://www.saferchoice.org/content/view/24/53/ http://www.saferchoice.org/content/view/24/53/ A gallery of loser stoners: http://coedmagazine.com/2009/02/06/the-10-most-successful-potheads-on-the-planet-cool-enough-to-admit-it/ http://coedmagazine.com/2009/02/06/the-10-most-successful-po... And if it is a concern about people's health, why is it treated as a criminal matter?
      - ErrantX 16y ago
        People's performance are also impacted by stress, sleep deprivation, etc. - they should be monitored for performance, not blood chemistry. Solid point. I can't disagree. Possibly the only issue worth raising is that cannabis influence may not be as physically obvious as those things you mention. For example a nurse may notice a brain surgeon is looking fatigued and raise concerns, but if on drugs his attention may wander at random moments which are not immediately obvious in the same way.
- abstractbill 16y ago
  I have no experience with growing pot but it seems to be a pretty easy thing to do... They don't call it "weed" for nothing ;)
  - josefresco 16y ago
    Growing something is easy. Growing a plant or plants healthy and robust enough for a decent harvest is far from easy unless you're already a farmer/grower.
    - Daniel_Newby 16y ago
      "Growing a plant or plants healthy and robust enough for a decent harvest is far from easy ..." You can cover up a multitude of sins using solvent extraction + chromatographic separation + blending. If legalization takes off, I suspect we will see the rise of blending conglomerates that assemble products for various tastes and purposes, like we see with whisky.
  - Mistone 16y ago
    growing grapes is easy, but producing an amazing wine is hard, or more in the spirit of HN building a web app is pretty easy but building something people want is hard, I assume the same applies with weed. It would be pretty lame if the Budweisers and Phillip Morris of the world come in and commoditize Marijuana, and it would put a major dent in some local California economies. But like a fine microbrew or boutique web shop there will always be a market for quality.
- jerf 16y ago
  I doubt there's an enormous untapped market here, given the stats on the current number of users. And there's no particular economic reason to think that "prices would remain stable"; yes, demand might rise, but supply will definitely rise (even if supplies were materially constant supply effectively rises due to lowered total cost of production due to lower risk of imprisonment), and there's no a priori reason to believe that these two forces would be even remotely in balance, even if they both exist. That's the way a human brain thinks about things, not the way reality works. High quality oregano is ~$5 a pound, according to a quick web search. Is there any particular reason to believe it wouldn't stabilize in roughly the same place give or take, say, 5x, if legalized? (And bear in mind that taxes not only don't go to the producer, they actually inhibit produce demand (http://www.daviddfriedman.com/Academic/Price_Theory/PThy_Chapter_7/PThy_Chapter_7.html http://www.daviddfriedman.com/Academic/Price_Theory/PThy_Cha... , search for "Who Pays Taxes?"), so that only makes it worse for these guys if the government starts taxes it punitively.) That's still over a full order of magnitude price drop from the estimates of MJ/lb I could dig up. It strikes me as very, very likely the bulk of the cost is compensation for taking on risk, rather than material or labor costs.
  - muhfuhkuh 16y ago
    > High quality oregano is ~$5 a pound, according to a quick web search. True, and grapes are 2.99 a pound at the local grocery store. Doesn't seem to explain why a good dinner table wine can be upwards of $100 a bottle. Never underestimate the power of a mind-altering substance, or the price that people are willing to pay for it.
    - rjett 16y ago
      "True, and grapes are 2.99 a pound at the local grocery store. Doesn't seem to explain why a good dinner table wine can be upwards of $100 a bottle." While there is an element of perceived value built into the price of a bottle of wine, much more goes into pricing a bottle of wine than the price of grapes. Different grape varietals can be more or less easy to grow depending on skin thickness, adaptability to different climates, and disease resistance. The pinot noir grape, a notoriously finicky varietal, really only shines in cooler regions and its thin skin makes it highly susceptible to disease. Other grape varietals, like Chardonnay, are highly adaptable to a number of different regions and soil types. Once harvested, grapes are typically sorted according to quality. The best grapes are used for the best wines. The excess, low-quality harvest is usually used for blending into massive batches of lower quality wine or grape juice or it's thrown into compost to fertilize the next year's crop. Once the juice from the grapes is pressed and fermented, the wine, depending on type, will either be aged in oak barrels or steel tanks. American Oak Barrels can range in price from $500-$1000 and French Oak Barrels can be double that. If aged in oak, which is typical of many reds and a few whites, the aging can typically take anywhere from a few months to many years. Once aged, the winemaker will typically select small samples from different barrels and experiment with different blends to get the optimal blend for balance and aging. All this being said, here's what I learned from working at a smaller winery in Virginia for a year: As a rule of thumb, most of our wines cost about $5-6 per bottle to produce. In the winery, we would sell at retail between $10-30 depending on the type of wine. We would sell at wholesale to restaurants and stores at $8-12/bottle. Stores would typically mark the bottles up to match what we sold the wine at at retail in the winery. Restaurants on the other hand will typically mark up a wine 3-5x what they purchased the wine at to account for corked wine, uncorking fees, storage costs, and of course to make a profit. So sure, marketing and perception play a big part establishing a market price for wine. (Thus a huge jump in Pinot sales the year after Sideways came out, and a corresponding drop in Merlot sales). But it's also naive to compare the mass-produced Concord or Niagra grapes you're getting at a grocery store to the bottle of wine you're getting at a restaurant.
- marltod 16y ago
  In the article they explain it is more like wine than a standard commodity. After legalization you will end up with everything from cheap mass produced quality up to artisan award winning products with a wide range of prices.
- trafficlight 16y ago
  I disagree that the market will increase as pot becomes legal. I think anybody who wants to smoke pot is already doing so, regardless of the legality.
  - theBobMcCormick 16y ago
    I can personally vouch for at least 1 individual who isn't smoking now but would certain be interested if it was legal. Unfortunately, I err.. I mean "this individual" doesn't live in California. :-(
- dustingetz 16y ago
  "Creative destruction can cause temporary economic distress. Layoffs of workers with obsolete working skills can be one price of new innovations valued by consumers. Though a continually innovating economy generates new opportunities for workers to participate in more creative and productive enterprises (provided they can acquire the necessary skills), creative destruction can cause severe hardship in the short term, and in the long term for those who cannot acquire the skills and work experience. However, in the long-term society as a whole (including the descendants of those that experienced short-term hardship) enjoys a rise in overall quality of life due to the accumulation of innovation - for example, 90% of Americans were farmers in 1790, while 2.6% of Americans were farmers in 1990[9]. Over those 200 years farm jobs were destroyed by exponential productivity gains in agricultural technology and replaced by jobs in new industries. Present day farmers and non-farmers alike enjoy much more prosperous lifestyles than their counterparts in 1790." http://en.wikipedia.org/wiki/Creative_destruction#Downsides_of_Creative_Destruction http://en.wikipedia.org/wiki/Creative_destruction#Downsides_...
Vivtek 16y ago
The future is a weirder place than I anticipated.
davemabe 16y ago
Maybe it's time to give these guys a bailout.
illumin8 16y ago
This is a good thing. If it becomes legalized, it becomes commoditized and pushes the small basement operations out because it is no longer profitable. In the end, prices are lower, crime is reduced, and the consumer and general public benefit from safer product and reduced crime.
- fjabre 16y ago
  Completely agree. The only issue I have is I don't want to see Philip Morris buy up all of NoCal and force everyone out of business. I think good growers will still be able to demand a premium for their marijuana no matter what happens in November.
  - illumin8 16y ago
    Good point; the best growers will always have a market for their product. NorCal is a lot like Napa Valley... some of the best wines in the world, if you know what I mean.
    - WiseWeasel 16y ago
      The prostitutes? They're nothing to write home about.
  - muhfuhkuh 16y ago
    Philip Morris makes tobacco a commodity. They'll surely treat cannabis the same way: grown outdoors with chemical pesticides and fertilizers, irradiated (not that that would matter, I guess, but it will be), sprayed with preservatives and who know what the hell else, etc. The good growers will do so in climate-controlled, forced-flowering, sea-of-green indoor operations using massive lighting arrays and "low rider" hybrid strains that produce gigantic buds with amazing crystals. It'll be like comparing "two buck chuck" wine at Trader Joe's to a Lafite Rothschild or Screaming Eagle. Most people won't care, but there is a market for the latter like you wouldn't believe.
    - mattmaroon 16y ago
MrJagil 16y ago
Legalization, taxation and regulation. Please.
tjmaxal 16y ago
This seems like a pretty simple supply and demand problem. Basic Microeconomics.
wendroid 16y ago
That's $4.40 a gram, £3. Street price here starts about £5
- antidaily 16y ago
  It was ~10 euro/gram in a couple coffee shops in Amsterdam when I visited recently.
  - whimsy 16y ago
    Well, you know what they say about markup in the food industry.
- jpablo 16y ago
  Don't forget that's wholesale price. Retail prices will obviously be higher.
teilo 16y ago
My only question is - if California legalizes, will the Obama administration step in and block the move just like the Clinton administration did with Oregon and medical marijuana?
- fjabre 16y ago
  It's a good question indeed. Obama's drug czar has stated on several occasions he's completely against legalization: http://thehill.com/blogs/blog-briefing-room/news/97101-obama-drug-plan-firmly-opposes-legalization-as-california-vote-looms http://thehill.com/blogs/blog-briefing-room/news/97101-obama...
- fuzzmeister 16y ago
  I doubt it, as they've already moved to stop raids on medical marijuana dispensaries: http://www.nytimes.com/2009/03/19/us/19holder.html http://www.nytimes.com/2009/03/19/us/19holder.html
byrneseyeview 16y ago
I wonder if it would be legal to create a futures market in weed prices. This would allow producers to hedge. They would just settle by looking at average prices (per some agreed-upon source) rather than physical delivery. Futures markets in heroin and cocaine could be used to predict political instability in Afghanistan and Colombia, respectively.
- cperciva 16y ago
  The US government created a futures market in political assassinations a few years ago, so I can't imagine they'd have a problem with a futures market in drug prices.
  - byrneseyeview 16y ago
    This market was very controversial, and eventually got shut down: http://en.wikipedia.org/wiki/Policy_Analysis_Market http://en.wikipedia.org/wiki/Policy_Analysis_Market So unfortunately it might be a little complex as a government project. But surely there's at least one wealth stoner who might want such a market to exist. Maybe James Cayne wants something new to trade.
korch 16y ago
I have long wondered what the impact would be on other illegal drug prices if MJ is legalized and undergoes a massive price drop. Many happy accidents from unintended consequences seem possible. If this removes ~20% of the revenue going to cartels and organized crime, will prices of other drugs go up or down? Will this lead to an up tick or down tick in inter-gang violence? Will local gangs in our communities lose enough revenue to put them out of business? Will there be fewer thugs on the streets committing crimes in general, all because you can buy a pound of MJ for $100 instead of $10,000. It's time to stop the War on Some Drugs (as Robert Anton Wilson so eloquently put it). I'm glad to see that it sounds like we're getting closer, with California leading the way. The amount of abuse, crime and fraud in the legal drug industry dwarfs the illegal drug industry combined, so by taking the spot light off this silly war on drugs, we can achieve many bigger policy goals in the pharmaceutical industry. Another plus will be we can finally help to strengthen Mexico. Anything about Mexico is politicized due to the current economic issues with immigration and drugs, so you see very few people calling a duck a duck, and saying the US indirectly caused spill-over failure in Mexico by having the war on drugs at all. Anyone who wants to fix immigration and stop all the rampant crime on the border, well, you need to also be on board with stopping the War on Some Drugs. If Mexico was as stable as Canada there wouldn't be as many immigrants, and if Mexico wasn't run by ultra-violent drug lords making billions off of US consumers, then not as many Mexicans would even want to leave their own country. 100 years from now everyone will look back at the decades of the war on drugs and consider our entire culture as being cruel and barbarous. As a society, we punished millions of people and ruined countless lives because we chose to collectively treat drug use and chemical addiction as a criminal issue, instead of a health issue. To be fair, we simply didn't have the technology to frame it as a public health issue, treat it medically, and thereby take it out of the hands of law enforcement and the courts. But we could have at least not ruined millions of innocent people's lives.
jacquesm 16y ago
Surprising number of upvotes on this article, I never figured there would be such a big intersection between hacking and an interest in drugs.
madprogrammer 16y ago
If marijuana isn't legalized in fall I'm seriously going to start lossing faith in humanity. I can't believe it's already 2010 and a herb that does nothing but good to everybody is ilegal for all the wrong reasons.
fjabre 16y ago
What the market predicts: http://www.intrade.com/jsp/intrade/common/c_cd.jsp?conDetailID=702407&z=1273457077941 http://www.intrade.com/jsp/intrade/common/c_cd.jsp?conDetail...
drivebyacct 16y ago
The sad thing is, people will indict the poor economic situation as a result of marijuana when its a result of every major "rush". People having no sense of how to plan financially.

128 points by mcantelon 16y ago

This is pretty interesting situation considering that it's as close to free market as you can get. Legalization could be good or bad but I think the more people, who currently don't use it due to legality, would consume pot and thus keep the prices stable. I have no experience with growing pot but it seems to be a pretty easy thing to do and thus supply is abundant. The market should readjust but that will be harsh

deleted 16y ago
[deleted]
pstuart 16y ago
I have yet to hear a cogent argument against legalization.
- hugh3 16y ago
  I was tempted to give one, but I don't think this is a good forum for discussing such a boring political issue. Please keep pro/anti drug legalization arguments elsewhere.
  - fjabre 16y ago
    Why? Flag the posting then. It's certainly relevant to the article.
  - blhack 16y ago
    >Please keep pro/anti drug legalization arguments elsewhere. Please don't take this the wrong way, but your account is 49 days old...I'm not sure that you're at the "I get to tell people what sorts of discussions they're allowed to have" stage yet, especially not to people that have been here for almost three years.
    - hugh3 16y ago
      Would it be okay if I had been around for 1021 days like this guy? http://news.ycombinator.com/user?id=hugh http://news.ycombinator.com/user?id=hugh
      - blhack 16y ago
        Honestly? Not really. It's an open forum, I don't think it's really ever good form to tell somebody "hey, you're not supposed to talk about that here." (unless it's spam, in which case, just downvote. Saying "don't talk about that" is off-topic and has been specifically addressed by PG in the past.) I'm sorry I didn't know that you had an alt account, it's just annoying when people start showing up and trying to dictate how things "should be" to established members of an existing community.
  - jokermatt999 16y ago
    I'm new(ish) here, but I don't see why not. HN tends to have a much better atmosphere for serious discussion than most web forums I've seen. I'd be happy to hear both sides of this argument here, and hopefully to see more reasonable debate than what is usually presented.
    - davidw 16y ago
      It has a pleasant atmosphere in part because it mostly avoids inflammatory topics like politics. I'd much rather talk startups and business, and maybe living abroad with patio11, for instance, than discuss why he's a Republican and I'm not. The former is bound to be a useful, interesting discussion; the latter most likely not. Actually, I'd be ok with the latter discussion too, but only in person, not on an internet fourm.
  - deleted 16y ago
    [deleted]
- aptimpropriety 16y ago
  Try this thread from a year ago: http://news.ycombinator.com/item?id=554166 http://news.ycombinator.com/item?id=554166 which links to this article: http://steve-yegge.blogspot.com/2009/04/have-you-ever-legalized-marijuana.html http://steve-yegge.blogspot.com/2009/04/have-you-ever-legali... Perhaps not an argument against, but certainly a 'reality' check argument against the "it's so obvious we should do it" mentality that seems to thrive in online forums.
  - Retric 16y ago
    Work is hard, let's go shopping. Is a poor argument. The real issue is the total difficulty of all issues not simply the number of them. EX: A "major" issue is it's hard to detect if someone is currently under the effects of pot. Because, apparently drug test are designed to detect if you have smoked not if you are currently impaired. However, an officer can do a road side sobriety test without using a breatilizer so it's not a real issue. Now if there was some sort of bioaccumulation of pot ever time that caused massive issues then that single issue could prevent legalization on its own.
    - moe 16y ago
      Now if there was some sort of bioaccumulation of pot ever time that caused massive issues then that single issue could prevent legalization on its own. I don't see a problem. Pot use can be detected, sometimes days (or weeks) after. The law in most of europe is simple: If you're tested positive while driving then your license is gone. Seems fair enough.
      - Retric 16y ago
        My point is if you get high and are only impaired for 8 hours then after 8 hours if you are not impared you should be able to drive. If you must wait 2 weeks after smoking to drive then it's not exactly legal for most people. The bioaccumulation idea was a separate issue; if smoking pot for 30 years turned people into zombies with an uncontrollable desire to eat brains then it should be illegal regardless of other negatives. (I could not think of any issues like this so I made something up for the sake of argument.) PS: You can probably detect pot in the blood of 75% of Americans if you set your threshold low enough. (Second hand smoke from 2 blocks away etc.) That does not mean it's impossible to separate smokers from non smokers just you need to set a reasonable threshold and accept you might miss the occasional smoker.
- marltod 16y ago
  The most effective argument is that it is a "Gateway Drug". There is no proof that weed makes people use crack or heroin but it is a good way to scare the public.
  - awolf 16y ago
    Marijuana is a gateway drug to other illegal drugs because it itself is illegal. In order to get marijuana you need to go see a guy that is ALSO selling other drugs (the kind that are actually dangerous). Legal marijuana makes it so that people don't start using more dangerous drugs on a whim. They are no longer presented with an easy opportunity. If pot is on the same level as alcohol which do you think is more of a gateway drug? One that makes you introverted and cautious or one that makes you more confident while simultaneously impairing your judgement?
    - pyre 16y ago
      It's also a 'gateway drug' in that you don't go crazy and commit mass-murder when you try it the first time, so you start to disbelieve all of the anti-drug propaganda and maybe decide that 'they' were lying about the harder drugs too.
- ErrantX 16y ago
  I have yet to hear a cogent argument against legalization. I have a couple of pretty simple one (it's worth considering). The long term affects of pot abuse are pretty easy to develop - I've seen medium-heavy users become fairly "brain dead" after several years of use. This is entirely from observation but it seems to occur faster than the same effect due to alcohol abuse. As a result we could see quite a few problems from more long term users. It is also harder to determine if someone is under the influence. This would mean some industries would have to begin mandatory drug testing prior to performing sensitive work - random examples: doctors, pilots. That's costly, time consuming etc. And if the long term affects of the drug are as pronounced as I suspect you could see heavy abusers in those fields actually pass drug tests and still fail to concentrate at a critical moment. It's certainly an area that needs a lot more research before legalization occurs.
  - pstuart 16y ago
    But this presumes that keeping it illegal prevents people from using it, and it clearly doesn't. Mandatory drug tests are common already (Home Depot does drug tests on all employees -- don't you feel safer about hardware?) People's performance are also impacted by stress, sleep deprivation, etc. - they should be monitored for performance, not blood chemistry. >It's certainly an area that needs a lot more research before legalization occurs. No it doesn't. It's safer than other existing legal drugs: http://www.saferchoice.org/content/view/24/53/ http://www.saferchoice.org/content/view/24/53/ A gallery of loser stoners: http://coedmagazine.com/2009/02/06/the-10-most-successful-potheads-on-the-planet-cool-enough-to-admit-it/ http://coedmagazine.com/2009/02/06/the-10-most-successful-po... And if it is a concern about people's health, why is it treated as a criminal matter?
    - ErrantX 16y ago
      People's performance are also impacted by stress, sleep deprivation, etc. - they should be monitored for performance, not blood chemistry. Solid point. I can't disagree. Possibly the only issue worth raising is that cannabis influence may not be as physically obvious as those things you mention. For example a nurse may notice a brain surgeon is looking fatigued and raise concerns, but if on drugs his attention may wander at random moments which are not immediately obvious in the same way.
abstractbill 16y ago
I have no experience with growing pot but it seems to be a pretty easy thing to do... They don't call it "weed" for nothing ;)
- josefresco 16y ago
  Growing something is easy. Growing a plant or plants healthy and robust enough for a decent harvest is far from easy unless you're already a farmer/grower.
  - Daniel_Newby 16y ago
    "Growing a plant or plants healthy and robust enough for a decent harvest is far from easy ..." You can cover up a multitude of sins using solvent extraction + chromatographic separation + blending. If legalization takes off, I suspect we will see the rise of blending conglomerates that assemble products for various tastes and purposes, like we see with whisky.
- Mistone 16y ago
  growing grapes is easy, but producing an amazing wine is hard, or more in the spirit of HN building a web app is pretty easy but building something people want is hard, I assume the same applies with weed. It would be pretty lame if the Budweisers and Phillip Morris of the world come in and commoditize Marijuana, and it would put a major dent in some local California economies. But like a fine microbrew or boutique web shop there will always be a market for quality.
jerf 16y ago
I doubt there's an enormous untapped market here, given the stats on the current number of users. And there's no particular economic reason to think that "prices would remain stable"; yes, demand might rise, but supply will definitely rise (even if supplies were materially constant supply effectively rises due to lowered total cost of production due to lower risk of imprisonment), and there's no a priori reason to believe that these two forces would be even remotely in balance, even if they both exist. That's the way a human brain thinks about things, not the way reality works. High quality oregano is ~$5 a pound, according to a quick web search. Is there any particular reason to believe it wouldn't stabilize in roughly the same place give or take, say, 5x, if legalized? (And bear in mind that taxes not only don't go to the producer, they actually inhibit produce demand (http://www.daviddfriedman.com/Academic/Price_Theory/PThy_Chapter_7/PThy_Chapter_7.html http://www.daviddfriedman.com/Academic/Price_Theory/PThy_Cha... , search for "Who Pays Taxes?"), so that only makes it worse for these guys if the government starts taxes it punitively.) That's still over a full order of magnitude price drop from the estimates of MJ/lb I could dig up. It strikes me as very, very likely the bulk of the cost is compensation for taking on risk, rather than material or labor costs.
- muhfuhkuh 16y ago
  > High quality oregano is ~$5 a pound, according to a quick web search. True, and grapes are 2.99 a pound at the local grocery store. Doesn't seem to explain why a good dinner table wine can be upwards of $100 a bottle. Never underestimate the power of a mind-altering substance, or the price that people are willing to pay for it.
  - rjett 16y ago
    "True, and grapes are 2.99 a pound at the local grocery store. Doesn't seem to explain why a good dinner table wine can be upwards of $100 a bottle." While there is an element of perceived value built into the price of a bottle of wine, much more goes into pricing a bottle of wine than the price of grapes. Different grape varietals can be more or less easy to grow depending on skin thickness, adaptability to different climates, and disease resistance. The pinot noir grape, a notoriously finicky varietal, really only shines in cooler regions and its thin skin makes it highly susceptible to disease. Other grape varietals, like Chardonnay, are highly adaptable to a number of different regions and soil types. Once harvested, grapes are typically sorted according to quality. The best grapes are used for the best wines. The excess, low-quality harvest is usually used for blending into massive batches of lower quality wine or grape juice or it's thrown into compost to fertilize the next year's crop. Once the juice from the grapes is pressed and fermented, the wine, depending on type, will either be aged in oak barrels or steel tanks. American Oak Barrels can range in price from $500-$1000 and French Oak Barrels can be double that. If aged in oak, which is typical of many reds and a few whites, the aging can typically take anywhere from a few months to many years. Once aged, the winemaker will typically select small samples from different barrels and experiment with different blends to get the optimal blend for balance and aging. All this being said, here's what I learned from working at a smaller winery in Virginia for a year: As a rule of thumb, most of our wines cost about $5-6 per bottle to produce. In the winery, we would sell at retail between $10-30 depending on the type of wine. We would sell at wholesale to restaurants and stores at $8-12/bottle. Stores would typically mark the bottles up to match what we sold the wine at at retail in the winery. Restaurants on the other hand will typically mark up a wine 3-5x what they purchased the wine at to account for corked wine, uncorking fees, storage costs, and of course to make a profit. So sure, marketing and perception play a big part establishing a market price for wine. (Thus a huge jump in Pinot sales the year after Sideways came out, and a corresponding drop in Merlot sales). But it's also naive to compare the mass-produced Concord or Niagra grapes you're getting at a grocery store to the bottle of wine you're getting at a restaurant.
marltod 16y ago
In the article they explain it is more like wine than a standard commodity. After legalization you will end up with everything from cheap mass produced quality up to artisan award winning products with a wide range of prices.
trafficlight 16y ago
I disagree that the market will increase as pot becomes legal. I think anybody who wants to smoke pot is already doing so, regardless of the legality.
- theBobMcCormick 16y ago
  I can personally vouch for at least 1 individual who isn't smoking now but would certain be interested if it was legal. Unfortunately, I err.. I mean "this individual" doesn't live in California. :-(
dustingetz 16y ago
"Creative destruction can cause temporary economic distress. Layoffs of workers with obsolete working skills can be one price of new innovations valued by consumers. Though a continually innovating economy generates new opportunities for workers to participate in more creative and productive enterprises (provided they can acquire the necessary skills), creative destruction can cause severe hardship in the short term, and in the long term for those who cannot acquire the skills and work experience. However, in the long-term society as a whole (including the descendants of those that experienced short-term hardship) enjoys a rise in overall quality of life due to the accumulation of innovation - for example, 90% of Americans were farmers in 1790, while 2.6% of Americans were farmers in 1990[9]. Over those 200 years farm jobs were destroyed by exponential productivity gains in agricultural technology and replaced by jobs in new industries. Present day farmers and non-farmers alike enjoy much more prosperous lifestyles than their counterparts in 1790." http://en.wikipedia.org/wiki/Creative_destruction#Downsides_of_Creative_Destruction http://en.wikipedia.org/wiki/Creative_destruction#Downsides_...

Vivtek 16y ago

The future is a weirder place than I anticipated.

davemabe 16y ago

Maybe it's time to give these guys a bailout.

illumin8 16y ago

This is a good thing. If it becomes legalized, it becomes commoditized and pushes the small basement operations out because it is no longer profitable. In the end, prices are lower, crime is reduced, and the consumer and general public benefit from safer product and reduced crime.

fjabre 16y ago
Completely agree. The only issue I have is I don't want to see Philip Morris buy up all of NoCal and force everyone out of business. I think good growers will still be able to demand a premium for their marijuana no matter what happens in November.
- illumin8 16y ago
  Good point; the best growers will always have a market for their product. NorCal is a lot like Napa Valley... some of the best wines in the world, if you know what I mean.
  - WiseWeasel 16y ago
    The prostitutes? They're nothing to write home about.
- muhfuhkuh 16y ago
  Philip Morris makes tobacco a commodity. They'll surely treat cannabis the same way: grown outdoors with chemical pesticides and fertilizers, irradiated (not that that would matter, I guess, but it will be), sprayed with preservatives and who know what the hell else, etc. The good growers will do so in climate-controlled, forced-flowering, sea-of-green indoor operations using massive lighting arrays and "low rider" hybrid strains that produce gigantic buds with amazing crystals. It'll be like comparing "two buck chuck" wine at Trader Joe's to a Lafite Rothschild or Screaming Eagle. Most people won't care, but there is a market for the latter like you wouldn't believe.
  - mattmaroon 16y ago

MrJagil 16y ago

Legalization, taxation and regulation. Please.

tjmaxal 16y ago

This seems like a pretty simple supply and demand problem. Basic Microeconomics.

wendroid 16y ago

That's $4.40 a gram, £3. Street price here starts about £5

antidaily 16y ago
It was ~10 euro/gram in a couple coffee shops in Amsterdam when I visited recently.
- whimsy 16y ago
  Well, you know what they say about markup in the food industry.
jpablo 16y ago
Don't forget that's wholesale price. Retail prices will obviously be higher.

teilo 16y ago

My only question is - if California legalizes, will the Obama administration step in and block the move just like the Clinton administration did with Oregon and medical marijuana?

fjabre 16y ago
It's a good question indeed. Obama's drug czar has stated on several occasions he's completely against legalization: http://thehill.com/blogs/blog-briefing-room/news/97101-obama-drug-plan-firmly-opposes-legalization-as-california-vote-looms http://thehill.com/blogs/blog-briefing-room/news/97101-obama...
fuzzmeister 16y ago
I doubt it, as they've already moved to stop raids on medical marijuana dispensaries: http://www.nytimes.com/2009/03/19/us/19holder.html http://www.nytimes.com/2009/03/19/us/19holder.html

byrneseyeview 16y ago

I wonder if it would be legal to create a futures market in weed prices. This would allow producers to hedge. They would just settle by looking at average prices (per some agreed-upon source) rather than physical delivery. Futures markets in heroin and cocaine could be used to predict political instability in Afghanistan and Colombia, respectively.

cperciva 16y ago
The US government created a futures market in political assassinations a few years ago, so I can't imagine they'd have a problem with a futures market in drug prices.
- byrneseyeview 16y ago
  This market was very controversial, and eventually got shut down: http://en.wikipedia.org/wiki/Policy_Analysis_Market http://en.wikipedia.org/wiki/Policy_Analysis_Market So unfortunately it might be a little complex as a government project. But surely there's at least one wealth stoner who might want such a market to exist. Maybe James Cayne wants something new to trade.

korch 16y ago

I have long wondered what the impact would be on other illegal drug prices if MJ is legalized and undergoes a massive price drop. Many happy accidents from unintended consequences seem possible. If this removes ~20% of the revenue going to cartels and organized crime, will prices of other drugs go up or down? Will this lead to an up tick or down tick in inter-gang violence? Will local gangs in our communities lose enough revenue to put them out of business? Will there be fewer thugs on the streets committing crimes in general, all because you can buy a pound of MJ for $100 instead of $10,000. It's time to stop the War on Some Drugs (as Robert Anton Wilson so eloquently put it). I'm glad to see that it sounds like we're getting closer, with California leading the way. The amount of abuse, crime and fraud in the legal drug industry dwarfs the illegal drug industry combined, so by taking the spot light off this silly war on drugs, we can achieve many bigger policy goals in the pharmaceutical industry. Another plus will be we can finally help to strengthen Mexico. Anything about Mexico is politicized due to the current economic issues with immigration and drugs, so you see very few people calling a duck a duck, and saying the US indirectly caused spill-over failure in Mexico by having the war on drugs at all. Anyone who wants to fix immigration and stop all the rampant crime on the border, well, you need to also be on board with stopping the War on Some Drugs. If Mexico was as stable as Canada there wouldn't be as many immigrants, and if Mexico wasn't run by ultra-violent drug lords making billions off of US consumers, then not as many Mexicans would even want to leave their own country. 100 years from now everyone will look back at the decades of the war on drugs and consider our entire culture as being cruel and barbarous. As a society, we punished millions of people and ruined countless lives because we chose to collectively treat drug use and chemical addiction as a criminal issue, instead of a health issue. To be fair, we simply didn't have the technology to frame it as a public health issue, treat it medically, and thereby take it out of the hands of law enforcement and the courts. But we could have at least not ruined millions of innocent people's lives.

jacquesm 16y ago

Surprising number of upvotes on this article, I never figured there would be such a big intersection between hacking and an interest in drugs.

madprogrammer 16y ago

If marijuana isn't legalized in fall I'm seriously going to start lossing faith in humanity. I can't believe it's already 2010 and a herb that does nothing but good to everybody is ilegal for all the wrong reasons.

fjabre 16y ago

What the market predicts: http://www.intrade.com/jsp/intrade/common/c_cd.jsp?conDetailID=702407&z=1273457077941 http://www.intrade.com/jsp/intrade/common/c_cd.jsp?conDetail...

drivebyacct 16y ago

The sad thing is, people will indict the poor economic situation as a result of marijuana when its a result of every major "rush". People having no sense of how to plan financially.