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Dear Mr. Berko: In September, you recommended three marijuana stocks. One was GW Pharmaceuticals, which tripled. Another, CannaVest, went up 50 percent. Terra Tech was 10 cents a share, and I bought 25,000 shares for $2,500; it’s now 46 cents a share, and I have a $9,000 profit. Would you please recommend several other companies that are or will be in the marijuana business? These are the stocks of the future, and I think they will be good long-term investments, just as the tobacco and alcohol stocks were 50 years ago.

G.H.

Fort Walton Beach, Fla.

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Dear G.H.: I don’t know anything about pot stocks. However, during the past year, I’ve received between six and 10 letters a week asking me for pot stock recommendations. I called a couple of hedge fund managers and some other investment pros whom I thought would know, but all I got were a couple of sources for coke. Then I remembered a municipal bond trader in Chicago who grows his own stuff. He gave me those three names.

Many papers elected not to print that column, so I was gabberflasted by the reception of the column and amused by the volume of letters and emails requesting other marijuana investments. However, I was taken aback by emails from three pastors in different cities. Their personal accusations shocked me, and their religious fervency condemned me to all kinds of unspeakable discomforts and living conditions. And then I was astonished by a two-page, single-spaced letter from a lawyer who wanted to represent me for $600 an hour if state or federal authorities “took any manner of hindering action against (my) person.” But best of all was a letter from an ex-member of the House of Representatives. He said Congress will double cigarette taxes to $2 a pack this year, which will bring in about $13 billion. “I believe,” he wrote, “from research we conducted, that taxing marijuana as a revenue base can bring in at least $21 billion in new tax revenues and save the federal government $86 billion in enforcement costs.” And I have good reason to believe that several of the bigwigs in Congress who serve your state can verify those figures.

So, in response to the large number of reader requests, I called the Chicago bond trader for a few new names. He gave me the following, with the caveat that, in his opinion, none of them is “worth a plugged peso.” So I pass on these names to you with the following red flags and yellow caution lights: 1, Most of these companies are primarily marketed and controlled by penny stock brokers (Think “The Wolf of Wall Street”); 2, None has ever earned a dime, and probably never will; 3, There will be scores of new, heavily promoted marijuana stocks coming to market this year; don’t trust any of them; 4, Each of these issues has uncommon volatility, with price changes of 100 percent or more a day – down, as well as up; 5, The markups and commission costs on them are obscene; 6, All are egregious speculations, and your money is likely to go up in smoke; 7, For grins and giggles, try reading the annual reports, balance sheets and income statements before purchasing; 8, Big tobacco companies – such as Altria, Lorillard, Philip Morris International, Reynolds American, Schweitzer-Maud and Universal – will control the market. They have the marketing expertise, the investment capital, the production facilities, the advertising dollars and the national delivery systems.

With that, here are some issues with which the trash-brokers are having fun:

Medbox (MDBX-$32.27) has $6 million in revenues and a 12-month trading range between $8 and $94.

AVT Inc. (AVTC-$3.80) has $14.9 million in revenues and a 12-month trading range between 50 cents and $5.25.

Hemp Inc. (HEMP-$0.30) has $28,000 in revenues and a trading range between a penny and $1.10.

GreenGro Technologies (GRNH-$0.53) has no reported revenues, but a trading range between 2 cents and $1.20.

Finally, GrowLife (PHOT-$0.32), with $3.6 million in revenues, has a trading range between a penny and 47 cents.

I think you would be hugely better off purchasing a lottery ticket.

Address your financial questions to Malcolm Berko, c/o The Daily Journal of Commerce, P.O. Box 8303, Largo, FL 33775, or email him at [email protected]. © 2014 Creators.com