Keynesian economics is dead. Yes, I mean the economist John Maynard Keynes, the once-famous and infamous economist who has inspired the model of the western world’s monetary and fiscal policies since the end of World War II.
What does Keynesian economics, or the idea that money should be managed by the government, wherein the economy is driven by mostly aggregate demand, and that people will buy more when they have more nominal money in their pocket, have to do with cannabis? Well, cannabis, like any other industry, is facilitated by money. And the money being invested into the cannabis industry meant to protect cannabis companies from the eventual consolidation of the industry is based solely on 75 years of “easy” money policy. The result being that larger firms with access to easy money will pick off weaker, smaller firms who cannot compete with multistate operators or large tobacco, alcohol, and pharma corporations when federal legalization arrives. The only defense for smaller cannabis firms is to fortify their balance sheets with “hard” money.
What do I mean by “easy” and “hard” money? First, money has three main characteristics. One, it is a store of value. This means that what an amount of