Cannabis stocks haven’t seen a year like 2020.
Several states are poised to allow recreational and medicinal marijuana. There is even a strong push for federal legalization.
And investors around the country are preparing to cash in on the biggest cannabis wave yet.
With the start of the new year just weeks away, we’re going take a look at several policy breakthroughs on the horizon. We’re also going to show you one of our top cannabis stocks to watch as the year unfolds.
First, here’s what Illinois is doing…
Illinois Looks to Boost Cannabis Banking
One of the biggest challenges for cannabis operations is their lack of access to banking services.
This has created an unsafe environment for individuals in the industry. They are effectively forced to conduct business entirely in cash, which creates concerns about storage and logistics.
While Congress is trying to push through the Secure and Fair Enforcement (SAFE) Act, some states are taking matters into their own hands. In Illinois, Sate Rep. Kambium Buckner has proposed legislation that would allow banks and credit unions to accept and issue “special purpose checks.” These financial instruments would specifically cater to the marijuana industry.
The bill would complement the recently passed law that legalizes cannabis in Illinois starting on Jan. 1, 2020. It would establish a Cannabis Banking and Credit Union Advisory Board to oversee licenses.
However, Illinois is just one of many states pushing cannabis reforms…
Six More States Seek Legalization in 2020
Heading into 2020, we’re already eyeing six states that could be battlegrounds for both the U.S. Senate and the legalization of cannabis. Over the next few weeks, we’ll look at one state’s efforts to pass recreational marijuana and eliminate criminal records for low-level offenses.
Arizona starts the list.
In 2016, voters denied a bill that would have legalized recreational cannabis. But a new legalization initiative could do for Arizona what it did for California and Oregon, which both passed marijuana on the second try. Advocates have returned to the docket with a more defined platform to address the concerns that fueled their narrow loss last time around.
The Arizona Marijuana Legalization Initiative is gaining traction across the state.
The new initiative aims to fund schools and state healthcare programs. The rules would also provide relief to individuals who were convicted of marijuana offenses. The probability of legalization in Arizona is higher heading into 2020.
The state will hold a special election this year for the seat of Senator John McCain, who passed away in August 2018. The special election will determine who serves the duration of the term through January 2023. The latest polls suggest a very tight race, which could drive more people to the ballot box. Also, a recent survey from OH Predictive Insights showed that 50% of Arizona voters supported legalization. Meanwhile, 40% opposed legalization, and the remaining 10% were undecided.
Investors looking to speculate on the campaign early should consider Harvest Health & Recreation Inc. (OTCMKTS: HRVSF). The company has 10 dispensary stores in Arizona and is likely the operator best poised for a bump in value should legalization pass next year.
Other states that could vote on marijuana legalization next year include Arkansas, Florida, Idaho, Mississippi, and New Jersey.
But here’s the cannabis legislation moving swiftly through Congress that could change the whole game…
Is Federal Legalization Pending?
The best possible development for marijuana stocks would be the full legalization of marijuana at the federal level.
Shortly before Thanksgiving, the House Judiciary Committee approved a bill that would remove marijuana from Schedule 1 of the Controlled Substances Act. The bill now has a high probability of approval in the House of Representatives.
The new bill would allow states to set their own policies around marijuana legalization. It also creates incentives to wipe the slate clean for people with low-level marijuana offenses on their criminal records. Finally, the bill would establish a 5% tax on cannabis products. This money would be directed to job training and legal assistance to individuals impacted by the war on drugs.
However, the bill will likely face stiffer opposition in the Republican-controlled Senate. U.S. Senate Majority Leader Mitch McConnell currently opposes the legalization of marijuana. That said, the 2020 election could create a swell of support for federal legalization. And U.S. President Donald Trump has reportedly explored using the executive branch as a way to decriminalize marijuana.
Don’t Miss the Next “Big One”: Anyone who passed on a little-known tech company in 1997 is haunted by a lost 11,200% windfall, as it went on to be an industry giant. Today, folks who snub the cannabis sector could be tomorrow’s cautionary tale. You’re not too late to lock in an opportunity on the ground floor, but this window won’t stay open long… Click here for the details…
About Money Morning: Money Morning gives you access to a team of ten market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and Moneymorning.com visitors become smarter, more confident investors.To get full access to all Money Morning content, click here.
Disclaimer: © 2019 Money Morning and Money Map Press. All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning. 16 W. Madison St. Baltimore, MD, 21201.
Source: Money Morning