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Why You Shouldn’t Short Cannabis Stocks Right Now

By Shadd Dales On Sep 5, 2023

Don’t wear white and definitely don’t short cannabis stocks after this Labor Day. In our latest Trade To Black podcast recap, we discuss the recent strong performance of cannabis stocks and what lies ahead after the Labor Day weekend and the buzz created by the HHS recommendation to reschedule.

In case you missed it, the beleaguered sector of cannabis hit the ground running following the HHS’ recommendation that the DEA to change cannabis from Schedule I to Schedule III in the Controlled Substances Act. In our previous podcasts on the subject, this potential reclassification could have a significant impact on the profitability of cannabis companies simply by exempting them from 280e. That’s not the only positive effect that could come about from this rescheduling.

Anthony Varrell expressed optimism about these actions, emphasizing the importance of research, scientific evidence, and a well-rounded argument. He also mentioned the potential influence of the Biden administration in favor of rescheduling. However, he also acknowledged the uncertainty surrounding the situation, highlighting that while the conversation is promising, nothing is set in stone.

The next critical step rests with the DEA, who are expected to respond within 90 days as they have a limited timeframe now to issue a statement. Lead financial writer Benjamin A. Smith brings up challenges that rescheduling might face in the near future, including potential legal disputes and appeals. Any changes to drug scheduling could lead to federal court involvement.

Still, the first trading week of September looks like it promises some interesting activity, and investors everywhere are looking forward to both the challenges and the opportunities. We’ll chat about the recent rally, the price action, and some of our favorite companies in cannabis right now. Above all: do not short the cannabis industry right now. Find out more about why on this podcast!

Shadd Dales is the Founder and President of The Dales Report and has an extensive background in the business media industry.

His work translates into over 15 years in mainstream media that included roles with BNN Bloomberg, CTV Properties and the iHeart Radio Network.

Shadd is considered one of the leading on air talents in both the cannabis and psychedelic space and has interviewed some of the most notable CEO names in the industry.

Shadd’s vision is to establish a content platform that is equivalent to a mainstream broadcast produced in a format that is relevant for today’s investor.