U.S. pot laws are still a mess… But these insiders are betting billions this will change soon… In the mailbag: “Mr. Bonner’s big idea is one of the most important keys to understanding life itself”…
That’s how much Canada’s largest cannabis grower, Canopy Growth (CGC), has agreed to pay for one of the largest cannabis growers in the U.S., Acreage Holdings.
As we’ll show you in today’s dispatch, it’s a massive vote of confidence for the legal pot industry in the U.S. But there’s a catch…
Cannabis is now legal in Canada at the federal and provincial level. But in the U.S., pot is legal only in certain states. It’s still illegal at the federal level.
And Canopy Growth doesn’t want to lose its coveted listing on the New York Stock Exchange, which won’t list firms that break U.S. federal laws.
So it’s structured the deal so it fully takes effect only when pot becomes legal at the federal level in the U.S.
Canopy Growth is so confident that cannabis will soon be fully legal in America, it’s willing to spend millions putting this deal together now.
That way, it can become a top dog in the U.S. market the moment federal prohibition ends.
It’s all part of the cannabis legalization mega trend we’ve been tracking for you. And it signals that we’re only at the very start of a multi-decade profit opportunity in the legal cannabis market.
Nick heads up our Crisis Investing advisory. And he was one of the first guys at Legacy to start covering the wave of pot legalization… and how our readers can profit.
He added the first legal pot stock recommendation to the Crisis Investing model portfolio in August 2017.
And as he’s been telling his readers, the end of federal prohibition is a lot closer than most people think.
Here’s what he told the folks who made the trip to be with us at our first annual Legacy Investment Summit in Bermuda last October…
Today, 66% of Americans say cannabis should be totally legal. That’s the highest level of support since polling on this issue started 48 years ago.
As a point in comparison, when Canada fully legalized cannabis last year it had the support of 68% of Canadians. That puts the U.S. number within spitting distance of what it took for the Canadian parliament to legalize pot nationwide for recreational use.
And Nick says U.S. politicians now understand that cannabis legalization is a winning political issue…
Support for cannabis legalization in the U.S. is bipartisan. A majority of Democrats and Republicans support it. And both parties are looking to plant their flag in it and push the other out.
I’d bet Trump understands which ways the political winds are blowing here. That’s why I’m convinced he has no choice but to legalize cannabis. And I believe he will do so before he leaves office.
Being ahead of the curve on the pot legalization mega trend is paying off.
The average gain for the eight open recommendations in Nick’s “End of Marijuana Prohibition” portfolio at Crisis Investing is 151%.
And the top performer, Canopy Growth (CGC), is up 596%. You can see this in the chart below…
That makes it the No. 1 open stock recommendation across all 22 of the advisories we publish under the Legacy banner.
The first domino fell in 1996. That’s when California legalized cannabis for medical use.
This triggered a cascade of falling dominoes… as Oregon, Alaska, Washington, Maine, Hawaii, Nevada, Colorado, Vermont, Montana, Rhode Island, New Mexico, Michigan, New Jersey, Arizona, Delaware, and Connecticut followed suit.
Then, starting in 2012, a second group of dominoes started to fall… as states began approving cannabis for adult recreational use.
Colorado and Washington were the first two states to make recreational pot legal for anyone over the age of 21. They were followed by Alaska, Colorado, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, and the District of Columbia.
Last June, the U.S. Food and Drug Administration (FDA) approved the first cannabis-based drug for use in America – Epidiolex. It treats severe forms of childhood onset epilepsy.
Then, last December, Congress voted to legalize hemp – a close cousin of the cannabis that gets you “stoned” – with bipartisan support.
And as Nick has been hammering home for his readers, this is part of the chain reaction that will end in the reversal of the federal prohibition of pot in the U.S.
That’s a huge deal for the cannabis industry. As long as pot is illegal, pot businesses operating legally under state laws can’t open bank accounts… apply for certain tax deductions… or even take their product over state lines.
It’s also scaring off investors… and making it difficult for pot businesses to access capital to expand.
That’s why folks in the U.S. cannabis industry are making moves to bring on full legalization.
To make sure it happens as soon as possible, they’ve brought in some heavy-hitters who know exactly how to make that happen.
Take former House Speaker John Boehner.
After resigning as Speaker in 2015, he joined the board of Acreage Holdings – the U.S. cannabis company at the center of the deal we mentioned up top.
That was the message Boehner had for CNBC viewers when he appeared on its Squawk on the Street show last month.
Boehner – who spent 35 years in the D.C. Swamp – didn’t always feel that way about cannabis.
In 1999, he voted to ban medicinal marijuana in Washington, D.C. And in 2011, he wrote a constituent to say he was “unalterably opposed to the legalization of marijuana.”
But Boehner had a sudden change of heart after he left public office. And for good reason. Here’s Bloomberg…
The ex-U.S. House speaker is poised to collect $1.59 million in cash once shareholders approve Canopy Growth Corp.’s acquisition of Acreage Holdings Inc., regulatory filings show.
If his former colleagues in Congress help make marijuana federally legal, he’d be eligible to receive Canopy shares worth about $16 million as of Thursday’s market close in exchange for his stake in Acreage.
Boehner is confident that will happen. Here’s how he explained it on CNBC…
With 33 states now approving the use of cannabis in some form, and of those 33 more and more are starting to look at recreational use, it’s clear this market is going to expand. And as it does, lawmakers in Washington have to look up and realize that the federal government is way out of step.
And when the U.S. fully legalizes cannabis… Nick says it will be orders of magnitude more profound than the repeal of alcohol prohibition in 1933.
Quite the opposite, says Nick…
There are more than 200 publicly traded cannabis companies. New ones seem to be popping up each week. Others simply are adding “cannabis” or related words to their company names to tap into the excitement building around this industry.
The truth is, most publicly traded cannabis companies are junk with abysmal financials. Nonetheless, many of these stocks have been soaring irrespective of their business potential.
It brings to mind Doug Casey’s saying that “when the wind blows even a turkey can fly.”
That’s why when it comes to new markets like legal cannabis, you don’t want to fall for the hype… and chase just any stock.
Instead, you want to look to the companies that already have a foothold in the industry.
And as we’ve been telling you here at The Daily Cut, Canopy Growth is one of the best places to get started.
At writing, Canopy trades for $48 – still below Nick’s recommended buy-up-to price of $50. So it’s not too late to get into this industry leader before legalization in the U.S. takes off.
At last year’s Legacy Investment Summit in Bermuda, Nick did much more than just predict that President Trump would legalize pot…
He also shared one of his top stock recommendations for profiting from this mega trend.
Attendees who followed that advice are up 57% in just six months… almost 10 times the return of the S&P 500 during the same timeframe.
And that’s just one of the more than 40 investment recommendations revealed during last year’s inaugural event in Bermuda.
To find out how you can join Nick and the rest of our experts at this year’s Legacy Investment Summit at the luxury Park Hyatt Aviara Resort in Carlsbad, California, check out our new summit website – www.legacyinvestmentsummit.com.
It’ll tell you everything you need to know about our 2019 Summit in beautiful Southern California.
As we’ve said before, the debate over socialism vs. capitalism is the longest-running in the Daily Cut mailbags so far.
But recently, we passed along an important take from Legacy Research cofounder Bill Bonner on the whole thing… That is, that this debate is a red herring for what’s really going on in America.
If you missed Bill’s big idea, catch up here and here.
Today, we turn it over to one of your fellow readers – and his thoughts on Bill’s latest conclusions…
Mr. Bonner’s big idea is one of the most important keys to understanding life itself, irrespective of any government’s choice of capitalism or socialism or whatever otherism…
The idea is every bit as stark as he paints it: Win-Win or Win-Lose. It’s either reciprocal or it’s not. It’s either voluntary or it’s forced. Gordon F. is trying to get at the same thing with his comments in last Thursday’s mailbag, if you notice.
You should be less concerned about whether your government claims to be capitalist or socialist and be a lot more concerned about your percentage of win-win as compared to win-lose. If you find yourself in a lot more win-lose scenarios than win-win, what difference exactly does it make which “ism” your government or your politicians claim to be?
Capitalism works. Win-win works. Win-lose doesn’t work at all or not for very long. People who like win-lose just naturally gravitate toward love of government, or crime (hmmm – is there much difference, really?). Margaret Thatcher’s comment on socialism remains the best I’ve ever heard: “The problem with socialism is that sooner or later, you run out of other people’s money.”
– Shawn S.
Are you concerned about the balance of win-win and win-lose in America that Shawn S. points out? Do you agree that understanding win-win vs. win-lose is the key to understanding life?
As always, write us at [email protected].
April 23, 2019