Marijuana News Today: Feds Could Impede U.S. Marijuana Legalization With Gun Laws; Pot Stock Market Down
Marijuana News Today
The marijuana news today features another way that the U.S. federal government is trying to impede marijuana legalization across the country—this time through the Second Amendment.
The Second Amendment of the Constitution, the right to bear arms, is dear to many Americans. It’s also highly contentious to others.
But what’s important for marijuana users is that the federal government is looking to suspend some of those rights in states where marijuana is legal.
In Massachusetts, for instance, prospective gun owners are required to fill out a form before purchasing their firearms. The form asks whether they are unlawful users of marijuana. But here’s the catch: under federal law, any use of marijuana is considered unlawful, no matter what legislation is in effect in the state. (Source: “Marijuana Users In Mass. Can’t Buy Guns,” WBUR News, July 16, 2018.)
Under that rule, it is technically illegal to use marijuana in any form and own a gun.
Now you may be asking, what does this have to do with marijuana stocks?
The problem for the pot stock market is that the hardest states to turn are going to be those that tend to lean right to begin with. Right-leaning states tend to be pro-gun, so telling these states that marijuana use would impede gun ownership may only create more of an opposition to legalization and, therefore, set a roadblock on the path toward full U.S. marijuana legalization.
Right now, the legalization process is being undertaken on a state-by-state basis. The idea that eventually most states will have legalized marijuana in some form or another is pretty commonly held, with the only question being when.
The federal government would see its hand forced to make a bold move on marijuana reform, should the vast majority of states legalize the drug—which is the direction that we’re headed in.
But this gun ownership snag may delay many states from pushing for marijuana legalization, preferring to keep their guns and perhaps turning to the black market for their cannabis needs.
All in all, it’s bad policy that will only hinder the progress that we all know needs to happen in the United States. Namely, that cannabis is removed as a Schedule I narcotic and is legalized on the national level—following the will of the majority of Americans.
CGC Stock News
To compound the weak marijuana news today, we have a pot stock market that is floundering. By the end of last week, many major marijuana stocks were down.
Canopy Growth Corp (NYSE:CGC) has tumbled by as much as seven percent since the beginning of last week, adding to a string of weak performances in July.
Chart courtesy of StockCharts.com
While I initially predicted that this summer would be a strong time for marijuana stocks, the Canadian marijuana legalization date being pushed back to October 17 has impacted that projection, with late August and September now appearing to be brighter times for the pot stock market.
As it stands, the industry is likely to undergo a number of pullbacks as we approach those dates and there’s little news to drive growth.
CGC stock has been particularly battered as of late, but I don’t think that this will be a permanent setback.
Come September, the hype train will again get rolling along, in anticipation of Canadian legalization in October. We’ll likely encounter a marijuana boom at that time.
For long-term investors, the key is to wait. For day traders, CGC stock will undergo a number of ups and downs over the next few weeks and months.
CRON Stock News
In the midst of the current marijuana stock market pullback, Cronos Group Inc (NASDAQ:CRON) appears to be the best port in this particular storm.
While other marijuana stocks have performed better, among the top companies, CRON stock appears to be the most stable in the current pot stock market.
CRON stock is still down, but only about one percent on the week. That’s hardly worth fretting over. The company has performed very well over the past two months, up about 12%.
While not head-spinning numbers, considering the capricious nature of the marijuana industry over these past few months, many marijuana bulls would be happy to see those numbers.
Analyst Take
The battle for U.S marijuana legalization will continue to be a pitched fight for years to come.
Marijuana prohibitionists are going to use all the tools at their disposal to block the green tide, but it will all be for naught (eventually).
And it’s that word “eventually” that’s the trouble. For long-term marijuana investors, the wait is not going to be pleasant, but it will be necessary in order to maximize returns on those investments.
Meanwhile, in the short term, the pot stock market continues to react to the massive spike in value that followed the announcement of the Canadian marijuana legalization date.
That pullback will likely continue for some time, finally abating the closer we get to October 17—likely sometime in late August.
