Investing in medical marijuana just became terrifying


medical marijuana

Contrary to popular belief, medical marijuana actual helps people. Sure, there are those who seek doctors for prescriptions just so they can legally use cannabis for fun. Yet patients with cancer, depression, and other symptoms regularly enjoy the medicinal benefits of weed thanks to recent state-wide laws. Before, these patients would rely on chemical-laden pharmaceuticals with unpleasant side effects. Now, they simply relax and let the CBD do its thing.

Unfortunately, Attorney General Jeff Sessions H-A-T-E-S marijuana in any form, regardless of its beneficial properties. The Republican Department of Justice head has compared cannabis to heroin, and stated more than once that “good people do not use marijuana.” If Sessions had his way, legal marijuana would go the way of the dodo.

For a while, it seemed as if current cannabis legislation would continue to exist on a state-by-state basis, as would the companies working in the space. Yet a recent memo sent by Sessions to Congress could put medical marijuana’s status in jeopardy. This is especially troubling for patients using medical weed. For weed based businesses and stocks, it could mean the end of days.

What’s going on?

Jeff Sessions wrote a memo to Congress for permission to prosecute state-based medical marijuana laws. Congress currently has a legal ban preventing the Department of Justice from fighting state-based legislature that permits medical marijuana operations. Sessions believes marijuana is as dangerous as the current opiate problem plaguing the nation, despite overwhelming evidence that it is relatively harmless. With permission from Congress, Sessions could use the might of the DEA and DOJ to put an end to medical and recreational marijuana. (You can read the full text of Sessions’ memo here.)

How will this affect medical marijuana?

There are three things that can happen here:

  1. Lawmakers ignore Sessions and medical/recreational weed is still legal. This will let medical marijuana operations continue to sell marijuana to patients with prescriptions. Businesses in the medical marijuana industry will still sell products and make money. The industry will grow as more people get prescription and recreational weed. The stock of publicly traded companies in the space will increase.
  2. Laws permitting medical and recreational marijuana are revoked. Weed-based businesses will close up shop seemingly overnight, as products for selling and growing marijuana no longer serve any legal purposes. This would mean the loss of millions (if not billions) in business. Most companies will close in the space, and stocks will lose their value.
  3. Recreation marijuana laws are revoked. Recreational dispensaries will have to convert to medical marijuana dispensaries. The industry will consolidate, as legal demand will decrease. This means less weed-based startups and likely less dispensaries.

Should you invest in medical marijuana?

One of these three instances will happen in the next four to eight years. If current laws are left alone, weed stocks could continue to provide value to investors. If the laws are changed, the industry could consolidate and become even more niche.

If you think the current administration won’t have an effect on marijuana laws, you could invest in the weed industry. Just make sure you do your research on your weed company of choice first. It’s worth noting that many existing stocks are sketchy penny stocks, which could put you in a financial jam if you pick the wrong one.

If you think legalization laws will change or disappear altogether, you probably want to sit this one out.

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