During Barack Obama’s presidency, the US relaxed its attitude towards cannabis. Donald Trump’s presidency and ‘Trump on Pot’ may be about to change this situation. Four US states have legalised recreational cannabis. That doubled during the 2016 election. Obama recently indicated federal legalisation of cannabis was inevitable. He said the government should treat it as a “public health issue, the same way we do with cigarettes and alcohol”. He said this was a “smarter way to deal with it”.
Obama on Pot
Obama’s 2016 election loss puts that attitude in doubt. As White House positions fill with those who are anti cannabis, the US waits to see Trump’s attitude. He is filling the White House with people who have the power to stop it.
Although states can legalise cannabis, it is illegal under federal law. Late 2016 Attorney-General Jefferson Sessions told Congress “we need grown-ups in charge in Washington” saying “marijuana is not the kind of thing that ought to be legalized, it ought to be minimized, that it is in fact a very real danger”. This was his response to Colorado legalising cannabis.
Trump on Pot
This year, White House spokesperson, Sean Spicer warned cannabis is still illegal at federal level. He said there was still a federal law that needed abiding when it comes to recreational drugs. He indicated he saw a marijuana crisis growing and government should not support that.
This immediately impacted Canopy Growth, Aurora, Aphira and OrganiGram stocks. These plummeted, losing between 3% and 9% of their value when they stabilised. Over the following weekend some regained their value and others did not. The panic sell off is a direct link to Spicer’s comments.
Canada on Pot
Canada’s Canopy Growth CEO, Bruce Linton, said the drop in price puzzled him. Spicer’s comments indicate there is no competition to Canada’s cannabis industry coming out of the US any time soon. If you want to be part of the growth of a legal cannabis industry, invest in Canopy stocks.
Linton believes a negative attitude from the US creates opportunities for Canada. With no stability or clear way forward in the US, Canada has the ideal environment for investors interested in medical and recreational cannabis within a legal framework.
Risk of Smuggling Pot Across US Borders
Canada has borders with 13 US states and only three will have legalised cannabis at the state level. There are fears that smuggling across the borders into the US could be the result of Canada legalising cannabis. Resulting in slowing down border crossings between Canada and the US.
US negativity supports Canada’s cannabis industry growth
Linton reminds that legalising cannabis was Mr Trudeau’s key election promise. He did not believe negative US comments would jeopardise cannabis legalisation in Canada. It is an opportunity for Canopy to research knowing there is no competition coming out of the States. US cannabis companies have trouble raising capital because of the state of the legislation in America. There is no certainty, which is a risk to investment.
Conflicting State and Federal Laws
With conflicting state and federal laws in the US, there is no consistent, safe cannabis industry. Patients seeking help and access to medical cannabis to relieve medical conditions have the added stress of a legal nightmare.
In 2013, Obama had the now famous
Cole memos sent out to federal prosecutors. It said to be tolerant of the those using cannabis in a harmless way in states that had legalised cannabis. But, in June 2016, police raided and shutdown a medical cannabis processing plant operating openly under state law. The Santa Rosa, California facility has reopened. After five months, the police seizure of
$5 million worth of property, $500,000 cash for payroll and another $1.5 million in products” was missing. Although company founder, Dennis Hunter, was not charged police failed to return property, products and cash seized in the raid.
What Trump on Pot Means For You
What Trump on Pot means for the US is anyone’s guess. It is all conjecture based on past performance and comments of public figures now empowered by the White House. What is certain is the state and federal laws in eight states clash. There is a disconnect that needs resolution.
This is positive for Canada with cannabis legalisation expected this year. The US government’s chilly attitude to cannabis creates more positive opportunities for a vibrant, legal cannabis industry. One that supports positive growth in many parts of Canada’s economy, and what the people want and Trudeau promised.
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I tend to agree with the writer of this article. I don't think we need worry about M. Trudeau going back on his word to legalize. Once that date was given the clock started ticking...Licensed Producers and private entrepreneurs alike will already have started investing countless thousands of dollars into what is basically a brand new industry which has to be ready for sudden and intense business transactions in just over a year from now. Any Canadian politician pulling the plug on such long awaited momentum would have to be suicidal, not just in the career sense. I think that the Trump situation has either a global or US specific relevance rather than anything relating to the Canadian MJ industry. The US government's hesitation to embrace the inevitable at Federal level just gives Canada more time to establish itself as a world class producer of high quality MJ, with all safeguards and quality standards in place. I have a feeling that M. Trudeau has this opportunity in mind and can see the benefit of the increased tax revenues paying down national debt and shoring up Health and Education services and maybe even some of our infrastructure...thereby creating his legacy, which is something very important for politicians.
Decriminalization wouldn't work in this grand scheme...all it would do is stop people getting a criminal record for carrying small quantities. It wouldn't take production or profit out of the hands of organized crime (which, by association, is the "gateway" to the stronger stuff not the MJ itself.) By all means keep it out of the kids' reach. It's much different stuff to the pot we had in the 70's and I believe the research that says it can damage the developing brain. Only by legalization can we discover more of its health treatment benefits and that, under medical supervision, it can be more safely given to kids than the toxic pharmaceuticals currently on offer.
There you go...that's my comment, Take it or leave it.