The Logbook: The illegal soda can arbitrage

In most markets, arbitrage trading is not only legal but encouraged due to efficiencies the traders who execute these arbitrages bring to the market. Not so for soda can deposits — specifically Michigan’s soda can deposits.

Since 1976, the Michigan Beverage Containers Law has required consumers to pay 10-cent deposits for their recyclable beverage cans and bottles. These consumers will be refunded their 10-cent deposits when these cans and bottles are returned. This policy  is designed to encourage recycling and provides funding for environmental programs in Michigan.