Remember back near the beginning of the race, when Obama admitted to doing cocaine? We sure do, and we think that following this could lead us to some interesting details about what Obama might do in regards to drug policies. To begin, some are speculating that this in and of itself may mean that Obama ease up The War on Drugs.

But let’s dig a little deeper. When we take a look at some of his previous statements regarding drugs on OnTheIssues.org we can gain some insight into what Obama may do about drug abuse. We can tell from these quotes that Obama believes that the that the problem lies in a lack of employment opportunities for the lower class. This would most likely mean that Obama’s reforms would increase the lower-class workforce, helping industrial companies, fast-food chains, and other manual labor based industries.

Taking a look at a government report about the economic costs of drug abuse (it’s 104 pages, but you can just read the summary) we can see that the majority of drug based costs lie in a decrease in productivity. What does that mean for our purposes? Pretty much that the benefits that were gained by increasing the workforce could be negated with lightened drug policies. This point can and has been argued both ways, so the amount of difference that lighter penalties will cause is hard to determine. Because of this we suggest using caution and watching the results carefully should you decide to invest in the aforementioned industries. Along the same lines, the healthcare industry (mostly insurance) could suffer from lighter penalties, but even if lighter penalties leads to less drug use, we believe that the stock benefits would be minimal and suggest staying away from these.

One last observation, decriminalizing or even legalizing marijuana, as some suspect Obama may do, could hurt tobacco and alcohol companies through new competition. Also it may help pharmaceutical companies using it for medicinal purposes.

Keep in mind that all the suggestions here only apply should Obama be elected, so if we end up with Clinton or McCain then you wasted your time reading this (just kidding). We’ll try to follow up with information on the other two candidates soon. And if you didn’t figure this out click the links to get specific stocks for the industries. Happy investing!

~Invest this!