Cannabis stocks tumbled, in a good way, on Thursday’s blockbuster news that the House of Representatives will call for a vote next week on the MORE Act (Marijuana Opportunity, Reinvestment and Expungement), which aims to remove cannabis from the list of federally controlled substances and promote social equity in the industry.
Then, within hours, other news arrived: the Senate unanimously endorsed a bipartisan bill to promote cannabis research. The latter did not quite pick up the screams and whispers or cause cannabis stocks go wildbut like a researcher put it, “Cannabis contains a galaxy of unexplored compounds…that may well transform our understanding of plant medicine and human biology.” So, yes, the legalization of cannabis research was another big news.
What about cannabis stocks?
Without a doubt, the legalization of cannabis in the United States would be a big step for cannabis stocks, especially given the slow but sad fall in the past yearlargely due to dashed hopes about progress, or lack thereof, on US federal legalization.
And although nothing is official yet, the suggestion that the legalization of cannabis is being discussed at the highest levels of government has encouraged investors and allowed cannabis stocks to continue to react positively.
Cantor Fitzgerald analyst Pablo Zuanic said he assumed the MORE Bill’s main sponsor, Rep. Jerrold Nadler (D-NY), had been in contact with Senate Majority Leader Chuck Schumer (D-NY), who is expected to introduce his own bill (the Cannabis Administration and Opportunity Act) on April 20. The CAOA is a broader reform bill than the SAFE Act that would allow interstate cannabis trade across the United States.
“Both bills, or a possible joint version, in our view, will at least allow Democrats to pretend they are doing their best to pass comprehensive cannabis reform. The conventional wisdom view is that none of the bills have the votes in the Senate to pass (based on what we know at this time, we agree with that sentiment),” a Zuanic said. “But as a representative of Perlmutter (sponsor of the Safe Banks Act) recently told us “the stars are aligning”.
Can the Democrats get away with this?
Can these top Senate Democrats afford to walk away empty-handed after garnering so much attention for their reform proposals?
Zuanic says the SAFE Banking Act could be more than just a “face saver” for Democrats.
“The SAFE passage could be an honorable start and provide a realistic spark for broader and more comprehensive future reform. Supposedly, SAFE (as it stands now) has over 60 votes in the Senate. It will all depend on Majority Leader Sen Schumer whether to do nothing this quarter (in terms of passing current DOJ legislation), or amend Rep. Perlmutter’s bill.
Obviously, getting even one of these bills through the Senate is the challenge.
Benzinga’s point of view
Perhaps it would behoove potential opponents in the Senate to look at the situation in a real, non-partisan way, because it would make sense to recognize that a large majority – 68% – of their own constituents want cannabis to be legalized, regulated and fairly taxed.
“Today, voters of all ages and in virtually every part of the country agree that marijuana should be legal,” said former NORML executive director Erik Altieri. “We have a mandate from the American people and we intend to make sure elected officials live up to it.”
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