THE SAFE(TY) DANCE
"The Safety Dance" is a song by Canadian band Men Without Hats, released in Canada in 1982 as the second single from Rhythm of Youth. I was reminded about this song by JT Taylor (@HedgeyeDC) this week as we dance back on forth on the SAFE chatter coming out of Washington, with JT keeping my enthusiasm for incremental reform in check. Will SAFE make it in the NDAA or not? Time will tell! Given the shifting political winds, if SAFE does not get passed in the NDAA, we will likely see a more significant push for broader legalization in 2022 during the mid-terms.
It appears that the democrats are using Cannabis as a political platform for 2022, but those political winds shifted in Washington, with Rep. Nancy Mace (R-SC) officially laying out her cannabis legalization plan. Titled the States Reform Act and co-sponsored by more than a half-dozen Republicans, the plan would essentially legalize cannabis on a federal level "in a manner consistent with the right of states to determine what level of cannabis reform or legalization each state wants to regulate, or not." It's a great start, but there is much work to do on the subject of legalization. The legalization process is going to be a long road, but some highlights of the States Reform act includes:
- Federally decriminalizes cannabis and fully defers to state powers over prohibition and commercial regulation.
- Regulates cannabis products like alcohol products
- Institutes a 3% federal excise tax on those products to fund law enforcement and small business programs.
- Ensures the continued existence of state medical cannabis programs and patient access while allowing for new medical research and products to be developed
- Protects our veterans by ensuring they will not be discriminated against in federal hiring for cannabis use or lose their VA healthcare for following their doctor's advice to use medical cannabis
- Protects children and young adults under 21 from cannabis products and advertising nationwide
- Protects medical cannabis for the following uses: arthritis, cancer, chronic pain, sickle cell, HIV/AIDS, PTSD, and other medical uses per a state's specific cannabis regulations.
We will be getting earnings from Best Idea LONG AYRWF on Monday morning, setting the tone for the week, but the short-term trade is focused on Washington.
Poseidon ETF
Also, Poseidon Investment Management, one of the longest-running dedicated cannabis investment funds, launched the AdvisorShares Poseidon Dynamic Cannabis ETF. It is sponsored by AdvisorShares and is sub-advised and managed by Poseidon Managing Directors Emily Paxhia, Morgan Paxhia, and Tyler Greif. "The fund seeks to identify companies strategically positioned to benefit from the cannabis industry and its supporting infrastructure in the U.S. as well as emerging global cannabis markets. PSDN's portfolio is diversified across subsectors of the cannabis industry and dynamically managed to tactically overweight or underweight specific countries, subsectors, or individual companies. The new ETF may seek to take advantage of specific market opportunities by intelligently using leverage to maximize potential returns."
Germany To Legalize Cannabis
Will Germany be the next country in Europe to legalize adult-use cannabis? Germany decriminalized medical cannabis some four years ago. Now Germany is about to decriminalize certain sale and consumption rules through a significant drug policy change undertaken by the ruling coalition government. The Institute for Competition Economics (DICE) at the Dusseldorf Heinrich Heine University suggests that a fully legal cannabis market could bring Germany around €3.4 billion in tax revenue and save roughly €1.3 billion annually for the judicial system. According to the same survey, the legal cannabis market in Germany would open 27,000 new jobs. Germany's population of nearly 84 million, legalization would create one colossal cannabis market.
