Lower GBP/USD = Lower Cocaine Purity

At Distressed Volatility we analyze trends in all markets (ex: $CAD/USD Pinching Margins On Canadian Marijuana Exports). From Bloomberg it looks like a lower GBP/USD rate lowers the purity of cocaine. Why not hedge FX risk and keep everybody happy? According to British Police, a year ago the purity of seized cocaine was 32% and now it's at 22% due to the USD rally (GPB/USD -20% MayOMay). Like she says on the video they have to keep their margins up. Kind of like how cereal boxes keep getting smaller. I'll keep my eyes open for more news on the street pharmaceutical industry.

"Chart of the Day- As Pound Erodes, So Does Purity of Cocaine" (Bloomberg)

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