We are making several changes to the cannabis position monitor.
We are announcing a strategic adjustment in our investment approach, particularly concerning our positions in CURLF (Curaleaf Holdings) and TLRY (Tilray Brands). Despite no change in our fundamental assessment of these companies, we are withdrawing our SHORT positions. This decision is influenced by the observed strengthening in the cannabis sector, potentially linked to anticipated changes in cannabis policies in Washington, D.C. This trend was highlighted by a robust performance in the cannabis market, with the MSOS ETF witnessing an influx of $32 million month-to-date and closing the week with a 7.65% gain. If December holds, inflows hold, it would make the ninth straight month of inflows into the MSOS. Accounting for December's inflows, there has been $178 million of inflows into the MSOS over the past nine months! Additionally, we are removing FFNTF (4Front Ventures Corp.) from our list. This long overdue decision reflects the management team's persistent challenges in effective capital allocation.
In a related development, the cannabis industry saw a surge of excitement on Friday. New York's marijuana regulators granted approval to six out of the state's ten licensed medical marijuana companies to commence adult-use cannabis sales starting December 29. This date marks the one-year anniversary of recreational cannabis sales in New York. The green light given to these companies, many of which are major players operating across multiple states, came from the state Cannabis Control Board, signaling a significant step in expanding the cannabis market in New York.
The following six companies have been approved:
- Columbia Care
- Curaleaf
- Etain LLC
- NYCANNA LLC
- PharmaCann of New York LLC.
- Valley Agriceuticals LLC, a part of Cresco Labs
Bankers' Ambivalence on SAFER Banking Act: A Closer Look at the Hesitations and Uncertainties in Cannabis Finance Reform
Last week, in a recent, intriguing episode at a Senate committee hearing, Senator Raphael Warnock of Georgia delved into a probing dialogue with leading figures from the financial sector. His focus? The multifaceted implications of the SAFER Banking Act are mainly through the lens of social justice. This legislative piece, though primarily crafted to simplify financial processes for cannabis enterprises operating within the legal boundaries of states, stops short of altering the federal legal status of cannabis. Senator Warnock, who had previously cast a dissenting vote against this Act, underscored the criticality of redressing the injustices borne by communities long battered by the war on drugs. His voice carried a note of apprehension: could this Act inadvertently sidestep the needs of these very communities? The response from the banking leaders was a tapestry of cautious support and ambiguity. They aligned with the Act's foundational goal yet paused, seeking further clarity. Their reluctance to assert that the Act would be a panacea for the deep-rooted racial wealth disparity was palpable. Senator Warnock, with a firm tone, highlighted the paramount need to weave considerations of the war on drugs' impact on marginalized groups into the fabric of any banking reform. In essence, he challenged the banking chiefs to navigate the complex waters of advocating for safer banking practices in a landscape where cannabis remains under the shadow of federal illegality. The bottom line is that they don't care about SAFER banking.
Green Light for Green Leaves: Unpacking the STATES Act and the New Era of Cannabis Legislation
In the waning days of 2023, an intriguing legislative maneuver unfolded within the corridors of U.S. governance. Spearheaded by Dave Joyce, a cohort of U.S. Representatives unfurled a novel rendition of the Strengthening the Tenth Amendment Through Entrusting States (STATES) Act. This Act, a tapestry of legal innovation, bestows upon states, the District of Columbia, U.S. territories, and tribal entities the authority to sculpt their narratives in cannabis policy. At its core, the STATES Act seeks to reconcile the longstanding discord between state-level cannabis laws and the overarching federal framework, a schism that has notoriously impeded medical research, cast shadows over commercial ventures, and skewed the focus of law enforcement efforts. This legislative piece ingeniously reimagines the Controlled Substances Act, carving out a niche for states to autonomously navigate the cannabis policy landscape while ensuring that the federal government's hand remains steady in areas such as age-related restrictions and employment standards within the cannabis industry. Moreover, the Act doesn't shy away from complex issues, incorporating clauses that address the FDA's regulatory role, the financial intricacies of cannabis transactions, and an insightful study into how legalization impacts traffic safety. This bold step marks a pivotal moment in the ongoing dialogue between state autonomy and federal oversight in the ever-evolving cannabis saga.
Key Highlights:
- Legislative Introduction: Representatives Joyce, Chavez-DeRemer, Mast, Blumenauer, and Carter introduced the STATES Act to respect state autonomy in cannabis policy.
- Federal-State Conflict: Addresses the contradiction between state laws and federal guidance on cannabis, aiming to support states' rights and improve regulatory support.
- Comprehensive Provisions: Includes amendments to the Controlled Substances Act, FDA regulation, youth protection, and financial transaction clarifications.
- Federal Restrictions Maintained: Keeps federal age restrictions for cannabis distribution and employment.
- Safety and Industry Support: Aims to create a safer environment for the cannabis industry and communities, fostering growth and development.
- Bipartisan Support: Emphasizes bipartisan engagement in cannabis reform, focusing on aligning federal policy with state laws.
- Impact on Law Enforcement and Medical Research: Seeks to redirect law enforcement resources effectively and promote critical medical research.
- Financial and Regulatory Clarity: Addresses financial issues caused by federal prohibition and clarifies the role of the FDA in cannabis product regulation.
- Traffic Safety Study: Mandates a study on the impact of marijuana legalization on traffic safety.
- Support from Various Organizations: Gained endorsements from groups like Americans for Prosperity, Coalition for Cannabis Policy, Education, and Regulation, and the National Cannabis Roundtable.
