Cannabis Stocks Continue To Rally After HHS Recommendation
The recommendation to the DEA to change cannabis from Schedule I of the Controlled Substances Act to Schedule III is making big waves in the world of cannabis stocks. For the second consecutive day, the stocks of many major cannabis companies continue to rally as investors finally begin to throw their momentum behind the industry. In this latest Trade To Black podcast, host Shadd Dales, millennial investor Anthony Varrell, and lead financial writer Benjamin A. Smith take a deep dive into the activity.
The HHS’s recommendation does not mean immediate change. This does, however, push the DEA to conduct its own review and decide whether to agree with the recommendation or not.
Schedule I is a list of drugs that are dangerous, have no medicinal value, and have a high potential for abuse. Being able to take cannabis off Schedule I has many potentially huge financial implications beyond the push to invest. Institutional banking and lending could be one of them. Bigger than this, however: the tax 280e will no longer apply to cannabis businesses, as it applies to schedule I and II substances only. Relieving the tax burden from 280e alone could push many of these ailing cannabis companies into profitability.
Analysts are being cautious and are pointing out that the shift to schedule III will introduce more questions than answers. Some feel that while it would be a step forward for cannabis to be under FDA regulations, but others are unsure whether this would be a positive movement.
Despite reservations on the analyst side, there are many positive results that could come from a rescheduling. Chuck Schumer could possibly push through the SAFE Banking act which has been stalled for years. This would secure a political victory and a bipartisan achievement for the ages.
We’ll take a look at the rallying of the cannabis stock industry in this podcast.
