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How GMO Foods and California's Prop 37 Could Affect Your Portfolio's Health

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If companies are required to add new labels to grocery products, someone will have to pay for the change. Health advocates say the requirement is worth it.

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MINYANVILLE ORIGINAL The impact that national elections have on current and future economic conditions is inherent, but ballot issues at the state level can have a major role in your portfolio's performance, too. This year, that issue is California's Proposition 37, a state statute whose fate will be determined on November 6. Regardless of where you stand on the issue of genetically engineered or modified organisms -- GMOs -- from a health perspective, regulations surrounding their future could affect your investments. Here's why.

What is it? Proposition 37 essentially calls for food manufacturer transparency regarding foods that contain GMOs, which have gone otherwise undisclosed in the United States to date. If you have no idea what GMOs are, you've most certainly consumed foods that include them. According to the US Food and Drug Administration, the first genetically modified tomato was sold in the United States in 1994, allowing consumers to buy on-the-vine tomatoes in the grocery store (which would have rotted in transport, pre-GMO days). Since that time, GMOs have seeped into the food supply; they're they primary component of many processed foods like cookies, crackers, salad dressings, and bread, which are made with genetically modified soybean and cottonseed oils, and corn syrup. GMOs are found in plenty of non-organic "fresh foods," too, including sweet corn, sweet potatoes, squash, and beets. The FDA's stance is that GMOs are harmless, and beneficial: They ward off crop pests, and tolerate herbicides used to maintain farming health. Some supporters of GMOs credit the processes with keeping food commodity prices down globally, and in allowing scientists to genetically alter plants to potentially deliver antibodies that ward off a host of human diseases. Those against GMOs cite studies (many of which are still disputed) as evidence of why they believe GMO foods are not only responsible for an increase in the amount of childhood allergies and autism, but also in the increased prevalence of adult onset diseases, including certain types of cancer.

According to Prop 37's specifications, raw or processed foods that are "intentionally and knowingly" genetically modified must be labeled as such. Additionally, Prop 37 would prohibit the labeling or advertising of foods with genetically modified components, as being "natural." But, Prop 37 also exempts several industries that use GMOs, including dairy, meat, and alcohol. Foods served in an "immediate consumption" setting (like a restaurant) aren't held to the standard under Prop 37, nor are processed foods that contain genetically modified ingredients which account for "one-half of one percent of the total weight of such processed food."

While the issue has become a heated statewide health and economic debate, the future of Proposition 37 could have a significant financial implication to investors, and the bioscience, agricultural, and foods industry. In fact, it's already cost millions of dollars.
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No positions in stocks mentioned.
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